BRASILIA, October 31, 2018 – Brazil carried out a record number of business reforms in the past year to help create jobs, attract investment and become a more competitive economy, says the World Bank Group’s Doing Business 2019: Training for Reform report, released today.
The four reforms of the past year are the most carried out by the country in a single year, since Doing Business was first published 16 years ago. The reforms by Brazil are the most carried out by an economy in Latin America and the Caribbean region in the past year.
The reforms helped Brazil advance to 109th place globally in the ease of doing business rankings this year.
“Brazil has clearly demonstrated its commitment to improve the business climate for small and medium enterprises. Sustained and continuous efforts in this direction will help Brazil remove hurdles to entrepreneurship and private enterprise which are key to reducing poverty and boosting prosperity,” said Martin Raiser, World Bank Director for Brazil.
The reforms of the past year included one that significantly reduced the time needed to comply with documentary requirements for Trading Across Borders. The introduction of electronic certificates of origin helped halve the time needed for importing to 24 days. The reform applied to both Rio de Janeiro and São Paulo, the two Brazilian cities measured by Doing Business. As a result, Brazil advanced by more than 30 places to a global rank of 106 in the area of Trading Across Borders, which has been a focus of reforms in the country, with six reforms carried out in the past decade.
For the first time in seven years, Brazil carried out a reform to facilitate access to credit. This was done by improving credit information through both the public credit registry and the private credit bureau. With this improvement, Brazil now scores a perfect 8 on the depth of credit information index, which is part of the Getting Credit measurement. However, there is much room for improvement on the strength of legal rights index, which examines the degree to which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending.
Brazil also made Starting a Business easier by launching new online system for company registration, licensing and employment notifications. The implementation of the system drastically cut the time needed to register a new business to just 20 days, from 82 days last year. However, the number of procedures needed to start a business, totaling 11, is still cumbersome, compared with the average of eight procedures in the Latin America and the Caribbean region. Nevertheless, the latest reform, in both Rio de Janeiro and São Paulo, helped improve Brazil’s global rank to 140 in the area of Starting a Business.
And, in São Paulo, a new electronic system to better manage power outages and distribution planning helped improve the reliability of electricity supply. The latest reform helped Brazil edge up to a global rank of 40 in Getting Electricity, an area in which the country performs best. The country’s performance in this area is underpinned by the affordable cost to obtain an electricity connection and the ease with which an electricity connection can be obtained. It takes four procedures and costs only 52.5 percent of income per capita to get connected to the electrical grid in Brazil, compared to the regional average of more than five procedures and 94.6 percent of income per capita.
Brazil underperforms in several Doing Business areas, including Registering Property, which was made more expensive last year in Rio de Janeiro, as a result of an increase in the municipal property transfer tax. Other areas where there is room for improvement are Dealing with Construction Permits and Paying Taxes.
The full report and its datasets are available at www.doingbusiness.org
