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China up in 'ease of doing business' [Copy link] 中文

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Post time 2018-11-2 17:33:23 |Display all floors


China is now one of the top 50 economies in the world for ease of doing business due to a record number of reforms carried out last year, according to a report released by the World Bank yesterday.


“China advanced to a global ranking of 46 this year, up from 78 last year, as the country implemented the largest number of reforms in the East Asia and Pacific region,” the report said.

Bert Hofman, World Bank country director for China, said: “China has made rapid progress in improving its business climate for domestic small and medium enterprises in the past year. The progress signals the value the government places on nurturing entrepreneurship and private enterprise.”


China’s reforms in areas including cutting administrative red tape earned the country a spot in this year’s top 10 global improvers, according to the report. Progress made in the areas of starting a business and getting electricity was particularly impressive.

Since last year, three procedures were removed and consequently it now takes nine days to start a business, on par with most OECD high-income countries. “Beijing is now one of only two cities in the world where the process of starting a business is completely free. China is now ranked 28 in the area of starting a business,” the report said.


Getting an electricity connection is also entirely free in China. Japan and the United Arab Emirates are the only two other countries in the world to have this distinction. As a result, China has earned a global rank of 14 in the area of getting electricity.


The time to obtain an electricity connection was also reduced thanks to the roll-out of a new mobile application for customers.


China also remains one of the best economies in the world to resolve a commercial dispute. It takes 496 days and costs 16 percent of the value of the claim, far better than the OECD high-income average of 582 days and 21 percent.


Despite progress made since last year, China still has room for improvement in terms of dealing with construction permits, with a global rank of 121 in the area.  


China also improved its building quality control by introducing stricter qualification requirements for professionals in the construction industry and improving public access to information. This reform applies to both Beijing and Shanghai, the World Bank report said.


The two major Chinese cities have also been instrumental in carrying out reforms that have reduced the time and cost to export and import by implementing a single window, eliminating administrative charges, increasing transparency and encouraging competition.


More importantly, the report states that China strengthened minority investor protections by increasing shareholders’ rights and role in major corporate decisions, clarifying ownership and control structures and requiring reimbursement of legal expenses incurred by shareholders.



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Post time 2018-11-2 23:18:18 |Display all floors
Still far behind Singapore, or for that matter the other separately ranked regions in Greater China too, in the overall ranking.

Not to mention that these reforms themselves, while absolutely necessary, come in such way that navigating them is an art in its own right. Especially if you want to invest somewhere else than first-tier cities or FTZs - and it is in those "somewhere else" places where China needs the investments most.



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Post time 2018-11-3 17:35:32 |Display all floors
Jaaja Post time: 2018-11-2 23:18
Still far behind Singapore, or for that matter the other separately ranked regions in Greater China  ...

Managing affairs in China is nothing like managing things in tiny territories like Singapore, Hong Kong, Taiwan, and eh, Finland.
Believe it or not, it's true.

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Post time 2018-11-6 16:33:54 |Display all floors
Managing affairs in China is nothing like managing things in tiny territories like Singapore, Hong Kong, Taiwan, and eh, Finland.


It should be just as easy (or even easier), if the central government really was as strong as it tries to appear as, and if their policies were as great and commonly acceptable as you among others claim.

That's the conflict in China that many foreigners (or even Chinese) do not understand.

Reforms and other policies are certainly decided in party meetings in Beijing, but the implementations are left to bureaucrats and local officials, which until very recently have more often been corrupt than not.

Then these local officials and their business partners cause all sort of problems to little people, what the more casual foreign media and observers blame on the central government.

China plays the card of strong central government, but fails to deliver the results that should be expected of such. The shortcomings of corrupt and incompetent implementors are wiped under carpet to keep up the appearance of strong government, and when discovered, that too goes to discredit the central government.

China spends lot of resources to censorship and propaganda just to manage and constraint those problems. This added layer itself is the main source for foreign criticism toward Chinese system. If it only had the self-esteem to accept things as they are.

This is the problem. The central government should either drastically step up, and speed up, the scrutiny and follow-up of it's own decisions, or loosen the image and really give more control to regional governments in deciding their own policies or even politics.

As personal experience relevant to this topic, I just yesterday visited local office under China's Ministry of Commerce. There, the employee working at the desk advised our (Chinese) company to ask our foreign clients to pay for services rendered to our personal bank accounts, rather than to the company bank account.

When I brought this option up with one of our foreign clients, it appeared that also their previous suppliers in China had only provided personal bank accounts to receive payments from abroad.

In these cases, when it is not about shady businessmen running off with money from foreign businesses, the purpose is simple tax evasion and circumvention of China's foreign exchange controls (which are stricter for companies than for individuals).

This example highlights how "ease of doing business" in China more often than not (still) means bending and breaking rules, rather than following them.

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