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MIERTA CAPAULProduct Leader

Investment Climate Advisory Services The World Bank Group

JakartaDecember 15, 2009

www.doingbusiness.org/Indonesia

Doing Business – Overview

Doing Business measures the regulations applying to domestic small and medium-size companies through their life cycle

10 indicators in 183 countries

The objective: well-designed, streamlined regulations, accessible to all

Doing Business 2010 is the 7th report

Asia is reforming

Indonesia, represented by Jakarta, is Asia’s most active reformer of business regulations in 2008/09

Reforms introduced in 3 areas improved the country’s ranking by 7 places

Ranking on the ease of doing business 2010

Subnational Doing Business

Expands the DB indicators beyond the most populous

city

Captures local differences in regulations or enforcement

Includes rules and regulations at all levels of

government

Gives specific locations an opportunity to tell their story

Provides a tool for locations to compete globally

Provides information on good practices within the same

country that can be easily replicated

Combines media appeal of DB with active participation

of subnational governments in the reform process

Doing Business in Indonesia 2010

Measures an entrepreneur’s every step and the associated time and cost; studies national and local regulations in 3 areas:

Starting a business

Dealing with construction permits

Registering property

Data were collected with the help of more than 160 private sector contributors and public

sector officials

Doing Business in Indonesia 2010 covers 14 cities

Balikpapan Banda Aceh BandungDenpasar JakartaMakassar Manado Palangka Raya Palembang Pekanbaru Semarang Surabaya Surakarta Yogyakarta

o Surakarta

Yogyakarta and Bandung are leading the ranks in the 3 areas measured by the report

CityEase of starting a

business Ease of dealing with

construction permits

Ease of registering property

Balikpapan 8 8 14Banda Aceh 6 10 8Bandung 5 3 1Denpasar 10 11 8Jakarta 7 13 2Makassar 9 2 10Manado 14 12 3Palangka Raya 3 3 5Palembang 4 6 6Pekanbaru 11 7 4Semarang 13 5 11Surabaya 11 14 6Surakarta 2 9 13Yogyakarta 1 1 12

Dealing with construction permits—many local differences during pre-construction

Yogyakarta

Makassar

Palangka Raya

Bandung

Semarang

Palembang

Pekanbaru

Balikpapan

Surakarta

Banda Aceh

Denpasar

Manado

Jakarta

Surabaya

0

50

100

150

200

250

0

50

100

150

200

250

Time Cost

Day

sC

ost (%

of G

NI p

er cap

ita)Time and cost to deal with construction permits

Time and cost to transfer a property title

Balikpapan

Banda Aceh

Bandung

Denpasar

Jakarta

Makassar

Manado

Palangka Raya

Palembang

Pekanbaru

Semarang

Surabaya

Surakarta

Yogyakarta

0

10

20

30

40

50

60

70

10.00

10.20

10.40

10.60

10.80

11.00Time Cost

Day

s

Co

st (% o

f pro

perty valu

e)

Registering property is faster in Manado than in Surakarta

Yogyakarta

Bandung

Surakarta

Palangka Raya

Balikpapan

Palembang

Banda Aceh

Makassar

Surabaya

Manado

Pekanbaru

Denpasar

Jakarta

Semarang

0

10

20

30

40

50

60

70

0

5

10

15

20

25

30

35

40

45Time Cost

Day

s

Co

st (% o

f GN

I pe

r capita)

Time and cost to start a business

Starting a business in Yogyakarta—easiest in Indonesia

Indicator Indonesia's global

performance in DB2010 (represented by Jakarta)

Best performing city within Indonesia

Best local practice

Global rank (183 economies)How Indonesian

cities would compare globally

Number of procedures to deal with construction

permits 14 procedures Yogyakarta 8 procedures 5

Days to deal with construction permits 160 days Makassar 56 days 9

Days to register property22 days Manado 12 days 24

Cost to deal with construction permits 194.8% of income per

capitaSemarang

107.6% of income per capita

78

Number of procedures to start a business

9 proceduresYogyakarta, Palangka Raya,

Surakarta8 procedures 93

Days to start a business60 days Yogyakarta, Bandung 43 days 143

Some cities perform up to international standards in certain areas

75%

9 reformers

90%

28 reformers

Number of states

2005 - 2007 2007 - 2009

► Great Impact • Political support for reform

efforts has continued even after two rounds of local elections and one presidential election since first benchmark

• 59 reforms recorded in 3 years• Methodology transfer to local

think-tank with support from Mexican government and WBG quality control

reformers Non reformers

Doing Business in Mexico 2005, 2007 & 2009

Competition and peer learning drive reforms

Why does it matter?

Evidence from business start-up reform in MexicoEvaluation of impact on formal firm creation of a municipal reform which decreased the time to obtain an operation license from average 30 to 2 days in 93 municipalities.

Increase in new start-ups by about 4% (Kaplan, 2006)Increase in employment in eligible industries by 2.8% (Bruhn, 2008)

Indicative of how policy reform can lead to substantial real impact

For moeere information visit: www.doingbusiness.orgTERIMA KASIH

http://www.doingbusiness.org/Indonesia http://www.doingbusiness.org/subnational

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