Over the past two years, it has become easier to do business in the regions of Kazakhstan due to the improvement of regulatory regulations in this area. This is stated in a new World Bank report.
According to the Report «Subnational Ranking of Doing Business in Kazakhstan 2019» (http://russian.doingbusiness.org/en/reports/subnational-reports/kazakhstan), the pace of reforms across Kazakhstan has gained momentum. Regions with smaller performance indicators have halved the gap with Almaty, the leading reformer, in two indicators: connection to the electricity supply system and the receipt of building permits. The reforms have been undertaken to reduce bureaucratic delays for entrepreneurs. They are moving the whole country towards global good practices in the business regulation system. Good practices noted in several regions paved the way for reform-oriented policy officials to further improve by replicating best practices in other parts of the country.
According to Arman Dzhumabekov, First Vice Minister of National Economy of the Republic of Kazakhstan, «The Government of Kazakhstan is implementing unprecedented systemic reforms aimed at improving the business environment, reducing administrative barriers and costs for business. As a result, Kazakhstan is among the top 30 reformers according to the World Bank's Doing Business rating. The World Bank's assessment of local rules and procedures will make it much easier for us to improve the local business climate, which will lead to further dynamic development of entrepreneurship in the country.»
This is the second Report on the Subnational Ranking of Business in Kazakhstan, covering the performance assessment in 16 administrative and territorial units - 13 regions, as well as the cities of Almaty, Nur-Sultan and Shymkent, thereby expanding coverage from the 8 administrative- territorial units studied in the first report of 2017.
Given Kazakhstan's desire to expand opportunities for all citizens and diversify the economy by increasing its share of small and medium-sized enterprises, the right regulatory system can help entrepreneurs overcome obstacles, including low productivity and corruption. By better managing the pace of reforms, as well as narrowing the gaps in implementation, enterprises will be able to reach their full potential and contribute to development,» said Ato Brown, World Bank Permanent Representative in Kazakhstan.
In order to determine the ease of doing business for small and medium-sized enterprises, the Report evaluates the business regulation system on four indicators: business registration, building permits, connection to the electricity supply system and registration of real estate.
Among all the measured cities and regions, Almaty is the most favorable for doing business, leading by three indicators - connection to the electricity system, registration of real estate and obtaining building permits. Nur-Sultan comes first on the indicator of business registration, due to the availability of electronic procedures and the level of use of the e-government platform. The Eastern Kazakhstan and Pavlodar regions share the highest rating with the city of Almaty on the real estate registration indicator. In these regions, the register of registered real estate rights is digitally maintained. No city considered and any area considered is characterized by equally high indicators for all measured indicators, but each of them leads at least one indicator. This suggests that there is a large reserve for mutual learning and exchange of experience between areas and cities.
It is noteworthy that all eight areas and cities studied in the reports of both 2017 and 2019 were able to improve their business environment. Of the 24 reforms implemented since 2017, eight have reduced the time to register businesses by an average of more than half. Important reforms have also been made to the electricity supply indicator; all eight regions and cities have improved the quality and continuity of electricity supply. The cities of Nur Sultan and Shymkent, as well as the Karaganda region, have made significant improvements in this direction by improving the registration and reporting systems of data on the frequency and duration of power outages. All eight regions and cities have also eliminated the requirement for expert opinion following external work and have streamlined procedures for requesting technical conditions.
On the global stage, Kazakhstan is making progress faster than many other countries and is competitive in terms of time and cost of doing business; in three of the four regulatory aspects measured by the study, the time it takes to meet all requirements has decreased more, on average, than in Europe and Central Asia and high-income countries. However, challenges continue to exist in terms of the complexity of procedures, especially on the indicator of obtaining building permits, and at the inter-regional level there are gaps in the effectiveness of the implementation of reforms coming down from the central level of the Government.
Moving forward, a key driver of success will be ensuring that national initiatives are properly implemented so that entrepreneurs can benefit from cost-effective and quality local services. Kazakhstan can enhance the effect of reforms by increasing local responsibility. Local decision-makers must move beyond national initiatives and remove barriers to doing business at the regional level through practical solutions to improve the efficiency of the service delivery system.
The Annual Doing Business Doing Business Report (www.doingbusiness.org) measures the success of 190 countries around the world. In the global report, Kazakhstan presents Almaty's largest business city. Reports on the subnational business rating in Kazakhstan seek to provide more detailed information on the business regulation system throughout the country. Instruments such as the Subnational Business Rating in Kazakhstan 2019 help to identify gaps in the performance of delivery points at the regional level to continue to use this information in policy development.
Source: World Bank
