KUALA LUMPUR: Malaysia’s ranking in ease of doing business improved to 18th position in this year’s World Bank Group report from a year ago.

According to the World Bank report titled “Doing Business 2015: Going Beyond Efficiency” released yesterday, Malaysia’s higher ranking this year reflects improvements in the ease of dealing with construction permits, as the one-stop shop for permits implemented in 2013 led to further reductions in the time required to obtain a development approval.

“[The report] has showed that since 2005, Malaysia improved its business regulatory framework [via] 17 reforms in the areas measured by the report.[This is in comparison with] the global average of 12 reforms per economy in that period,” said the World Bank in a statement.

“Malaysia has therefore narrowed the gap with some of the best practices worldwide. In business incorporation, for example, Malaysia has undertaken a series of steps to ease the burden of local entrepreneurs, such as merging the company, tax, social security and employment fund registrations at a one-stop shop in 2011.

“Efforts such as these have reduced the time required to start a business from 37 days in 2005 to less than six days today, which is less time than in Ireland,” it added.

“Through an ambitious reform agenda, Malaysia has gradually improved the ease of doing business. This has benefited local entrepreneurs, who now have fewer regulatory hurdles to deal with and more resources to focus on their business,” said World Bank Group’s Doing Business lead author Rita Ramalho in the statement.

“Malaysia’s case also showed how the latest technologies can be used to improve the regulatory environment for businesses. Over the past five years, for example, the implementation of electronic systems has made it easier for businesses to pay taxes and execute contracts,” she added.

In its 12th year, the Doing Business report analyses regulations that apply to an economy’s businesses during their life cycle, including start-up and operations, trading across borders, paying taxes and resolving insolvency. But it does not measure all aspects of the business environment that matter to firms and investors.

The aggregate ease of doing business rankings are based on the distance to frontier scores for 10 topics and cover 189 economies.

Singapore topped the global ranking on the ease of doing business. Included in the top 10 list of economies with the most business-friendly regulatory environments are New Zealand, Hong Kong, China, Denmark, South Korea, Norway, the United States, the United Kingdom, Finland and Australia.

Challenges persist, though, the World Bank Group said. For example, further adapting the legal framework to internationally recognised good practices in the area of insolvency will better protect entrepreneurs involved in insolvency procedures.


This article first appeared in The Edge Financial Daily, on October 30, 2014.