IBC SWAZILAND - Starting a Business in Swaziland 29052012

7/31/2019 IBC SWAZILAND - Starting a Business in Swaziland 29052012

1/17

P R E S E N T A T I O N B Y

P R E S I D E N T , F S E & C C

M A Y 2 9 T H , 2 0 1 2

Starting a Business In Swaziland:Issues and Bottlenecks


2/17

Background Information

Enabling Environment important to attractingentrepreneurs to start businesses

Enabling environment includes:

regulatory framework investment climate


3/17

Regulatory Framework

Regulations that directly affect businesses throughthe costs of compliance

Indirect costs resulting from unnecessary

transactions such as time lost while chasing permits,licenses, and completing numerous documents


4/17

Investment Climate

Encompasses wider framework conditions:

Infrastructure

Functioning financial markets

Functioning health and education systems

Trade Liberalization

Political stability and security

Standards for production


5/17

What Does It Take To Start A Business in Swaziland?

Write letter to Registrar of Companies and reserve name

Pay fee for reserving name at Treasury

Obtain tax clearance for company directors

Request law firm to prepare documents for incorporation Submit documents to Company registrar

Acquire trading licence from Ministry of IndustryCommerce and Trade*

*Paying for licence, obtaining bank statements, tax identification numbers fromSRA, certificate of inspection from Health Dept/City Council, registeringworkers with the Provident Fund, enrolling for Workmens Compensation with

SRIC.


6/17

Process Is Cumbersome!

Many procedures, a lot of institutions:

Registrar of companies, Treasury, Swaziland RevenueAuthority, law firm, licensing department at Ministry ofCommerce, Industry and Trade, bank, Health Department or

City Council, Swaziland National Provident Fund, RoyalSwaziland Insurance Corporation

Institutions critical to process mainly located inMbabane

Procedures take too long, e.g. registration (up to 30days) and acquiring a licence (up to 30 days)


7/17

Other Considerations

Dependency on sole providers for important services

Small market size with significant poverty andunemployment rates.

Business risks associated with occasional socialunrest.


8/17

Starting A Business In Swaziland A WBDB* 2012Perspective

Swaziland ranks 161 out of 183 economies on easeof starting a business

Ranking dropped from 157 (2011) to 161(2012)

Amongst lowest ranked countries in the SADCregion

*WBDB World Bank Doing Business


9/17

Swaziland vs Other African Economies

Country Rank on Ease of Starting aBusiness

South Africa 44

Zambia 69

Botswana 90Regional Average (Sub-Saharan Africa) 123

Namibia 125

Lesotho 144

Swaziland 161

Angola 167

Source: Doing Business Report 2012


10/17

Swaziland is Falling Behind

Swaziland Sub-Saharan Africa

DB 2008 DB2012 DB2008 DB2012

Number of Procedures 12 12 10 8

Time in Days 60 56 55* 38*

Costs (% of income percapita)

41.1 29.2 180* 80*

Paid-in minimum capital(% of income per capita)

0.6 0.5 180* 130*

Source: Doing Business Report 2012

*Figures not exact based on graphical interpretation


11/17

WBDB 2012 In a Nutshell

More procedures to start business in Swazilandcompared to region

Takes longer in Swaziland to start business

compared to region Reform process is slow report says nothing has

been done in the past few years


12/17

Post WBDB 2012

*


13/17

Trading Licences (Amendment) Act 2011

Shortens advertising period during trading licenceapplication from 21 days to 3 days

Business owners in informal sector dont have to

advertise when applying for licence Consent to conduct Business on Swazi Nation Land

only given to indigenous Swazis and companieswholly owned by indigenous Swazis


14/17

More Silver Lining

Shop Trading Hours Act, 2011

Launch of Investor Roadmap

SIPA initiative for online registration of companies

Allocation of funds in budget to build factory shells


15/17

More Can Be Done

Cut red tape reduce number of procedures andinstitutions that need to be consulted

Decentralize company registration and licensing

Institute and accelerate e-registration and licenceapplication


16/17

Conclusion

Swaziland has room for improvement.

Private sector and government collaboration crucialin improving business climate.

Recommendations from PSDS and InvestorRoadmap key to process.

We must not be defensive, but be introspective.

Once we have improved processes, we mustcommunicate and highlight our improvements.


17/17

Thank You!

Documents

IBC SWAZILAND - Starting a Business in Swaziland 29052012