A recent report by the World Bank and International Finance Corporation (IFC) paints a rosy picture about doing business in the developing world.
A recent report by the World Bank and International Finance Corporation (IFC) paints a rosy picture about doing business in the developing world.
The report, ‘Doing Business 2013: Smarter Regulations for Small and Medium-Size Enterprises’ says that local entrepreneurs in developing countries are finding it easier to do business than at any time in the last 10 years, highlighting the significant progress that has been made in improving business regulatory practices across the globe.
“Over the years, governments have made important strides to improve their business regulatory environment and to narrow the gap with global best practices,” said Augusto Lopez-Claros, Director, Global Indicators and Analysis, World Bank Group. “While the reforms we measure provide only a partial picture of an economy’s business climate, they are crucial for key economic outcomes such as faster job growth and new business creation.”
This is good news for those aspiring to do business in this part of the world. Yet there are still concerns regarding the business atmosphere in South Sudan. The cost of doing business is adversely affected by the infrastructure which is not up to standard.
In a report inside this newspaper from one of the states, Western Bahr-El-Ghazal, businessmen are finding themselves in a quandary as they grapple with the high costs associated with transporting good on the roads.
The ‘Doing Business in Juba 2011’ by World Bank says that compared to 183 other economies measured by Doing Business, Juba would rank 159th on the ease of doing business. On trading across borders, Juba would rank 181st. Using the port of Mombasa in Kenya, an entrepreneur will spend US$9,420 to import a container.
Since most of the goods that are consumed in South Sudan come from neighbouring countries, transportation costs take a big chunk of the money spent by business people. And since breakdowns on the roads are a major occurrence, businessmen and public service vehicle owners have to bear the cost of repairing their vehicles which break-down every now and then.
And as any vehicle owner would know, poor roads translate to more costs for repairs and maintenance. This was aptly demonstrated recently when vehicles were stuck on the road between Juba and Wau, with drivers complaining about the state of the road. One lamented that a distance of approximately 74 kilometres (approximately 46 miles) takes more than four hours to cover! This is because of the poor state of roads.
To cushion themselves against these extra costs, business people are forced to pass these costs down to the consumers. That is why we are calling upon the government and other stakeholders to move in urgently and help to rehabilitate the dilapidated roads. Already, we are aware that the government is doing something but this is not enough. Other stakeholders with capital need to come in and support government efforts.
At the same time, there are those who question the recent announcement by the ministry of roads and bridges of plans to construct a highway linking Mombasa and Juba. One of our readers writing from the US says that the proposed road is not a priority for now. He reckons that more resources should be used to maintain the existing roads that lead to the interior of the country. He adds that the Mombasa-Kampala-Juba road should continue to serve the South Sudanese business community for the next two to three years.
This is one of the many proposals that different players are bringing up. However, all seem to be in agreement that more needs to be done in the area of road infrastructure. It is only the how and when that they differ about.
And that is why we strongly advocate for more resources, and more players to get involved in development of road infrastructure in South Sudan. That is the only way that the government will be seen to be helping the people at the grassroots, many of whom will be vulnerable without government’s intervention.
