An Analysis on Doing Business in Papua New Guinea
How easy is it to start a business in PNG?
Since 2004, Doing Business has been tracking regulatory reforms aimed at improving the ease of doing business by measuring their impact on 10 indicator sets across 181 economies from Afghanistan to Zimbabwe. Nearly 1,000 reforms have been captured since that time.
For the fifth year in a row, Eastern Europe and Central Asia has led the world in Doing Business reforms – the region accounts for a third of all reforms observed since Doing Business 2004. In 2007 Eastern Europe and Central Asia surpassed East Asia and Pacific in the average ease of doing business and has maintained its place this year.
More regulatory reforms were recorded around the world between June 2007 and June 2008 than in any previous year of which 113 economies implemented a total of 239 reforms.
Great news for entrepreneurs all over the world – except if you live in Papua New Guinea where our score for the implementation of the World Bank’s recommended reforms amounted to a vibrant ZERO.
Only a total of five reforms were undertaken in four Pacific countries with Vanuatu leading the way thus improving its ranking from 67 to 60.
Singapore topped the global rankings on the overall ease of doing business for a third consecutive year with New Zealand second, Australia ninth and followed by its Pacific neighbours of Fiji (39), Tonga (43), Vanuatu (60), Samoa (64), Solomon Islands (89), Papua New Guinea (95), and Timor Leste (170).
Examples of how hard it is to do business in PNG include:
- 56 days for an entrepreneur to go through eight long procedures before he can start operating
- 217 days for a business to go through 24 procedures to obtain a construction permit, 155 days more than it takes in the Solomon Islands
- 72 days to register a property, compared to four days in military ruled Fiji
- Over 194 days for businesses to make 33 taxation payments compared to 88 days in Solomon Islands
- A tax rate of 41.7 per cent on profit compared to just over 8 per cent for Vanuatu and 18 per cent for Samoa
- 26 days to process an export licence – applicants have to fill seven documents
- 29 days for anyone to wait before they can import anything
Doing Business ranks economies based on 10 indicators of business regulation that record the time and cost to meet government requirements in starting and operating a business, trading across borders, paying taxes, and closing a business.
The rankings do not reflect such areas as macroeconomic policy, quality of infrastructure, currency volatility, investor perceptions, or crime rates.