The recent release of The World Bank Group’s (WB) flagship report “Doing Business 2018-Reforming to Create Jobs” shows the major strides the U.A.E. has taken in improving its global business competitiveness. The latest data shows that the U.A.E. ranks first in the region for a fifth year in a row in the Ease of Doing Business rankings. Moreover, the U.A.E. continues to steadily climb worldwide rankings of business competitiveness, moving from 26th position in 2016 to 21st in 2017. This is a reflection of proactive efforts by U.A.E. leadership to both assess and improve their own laws and regulations so as to meet internationally recognized best business practices, drive competitiveness, and ensure the U.A.E. holds its position as a leading business hub not only for the region but the world.
The Doing Business 2018 Report examines aspects of regulation affecting eleven areas of business. Ten of these areas are included in this year’s ranking on the ease of doing business. These areas include: starting a business, dealing with construction permits, obtaining electricity, registering property, obtaining credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, and resolving insolvency. The eleventh area, not included in this year’s ranking, measures features of labor market regulation.
The U.A.E.’s prominent position in this ranking can be attributed to ranking first globally in both paying taxes and obtaining electricity, second globally in the handling of construction permits, tenth globally in both registering property and in protecting minority investors, and 12th globally in contract enforcement. Notably, the U.A.E.’s rise in the ranking this year is due partially to sweeping changes to insolvency procedures, which has led to a significant jump in the ease of resolving insolvency to 69th globally.
In addition to quantitative rankings, this report provides valuable qualitative updates on four of the U.A.E.’s areas of doing business.
- The U.A.E. made obtaining electricity easier by streamlining the connection process and eliminating interactions between the customer and utility to obtain external works. Getting electricity was also made less costly by the elimination of the security deposit for connections under 150kVA.
- The U.A.E. strengthened construction quality control by imposing stricter qualification requirements for professionals reviewing drawings. It also reduced the time and cost to obtain a building permit by eliminating specific procedures.
- The U.A.E. improved provisions on the treatment of contracts during insolvency. In addition to the improved provisions, the U.A.E. introduced a reorganization procedure as an alternative option to liquidation and adopted legal regulations enabling parties to make use of the reorganization procedures for the purpose of saving viable businesses where there is prospect of financial recovery.
- Finally, in regards to credit scores, the U.A.E. credit bureau began offering consumer credit scores to banks and financial institutions as a value-added service to help them assess the credit worthiness of borrowers.
