Ease of doing business in South Africa
By Werner van Rooyen
16 May 2014
Sometimes it feels that it is really impossible to start a business in South Africa. It also feels that it is very difficult to do business in South Africa. But how difficult is it really?
There are various indicators that show us how difficult it really is based on certain factors. One place where one can see how difficult it is to do business in South Africa is the survey that is done annually by the International Finance Corporation and the World Bank. In this survey, 189 economies are measured on 10 topics. This is shown in the table underneath. The full survey as well as all the rankings can be found at www.doingbusiness.org/rankings.
In the table underneath South Africa is compared to other Southern Africa (Namibia and Mozambique) countries, Brazil which is a BRICKS partner, as well as Singapore which is ranked number one and New Zealand which is ranked number three.
| Doing Business | RSA | MOZ | NAM | BRA | SING | NZ |
| Ease of doing business | 41 | 139 | 98 | 116 | 1 | 3 |
| Starting a Business | 64 | 95 | 132 | 123 | 3 | 1 |
| Dealing with Construction Permits | 26 | 77 | 31 | 130 | 3 | 12 |
| Getting Electricity | 150 | 171 | 72 | 14 | 6 | 45 |
| Registering Property | 99 | 152 | 178 | 107 | 28 | 2 |
| Getting Credit | 28 | 130 | 55 | 109 | 3 | 3 |
| Protecting Investors | 10 | 52 | 80 | 80 | 2 | 1 |
| Paying Taxes | 24 | 129 | 114 | 159 | 5 | 23 |
| Trading Across Borders | 106 | 131 | 141 | 124 | 1 | 21 |
| Enforcing Contracts | 80 | 145 | 69 | 121 | 12 | 18 |
It is clear from this survey that South Africa is not the worst place to do business in. That title belongs to Chad which is number 189 on the list! If you examine the list it is clear that the Africa Continent Countries or Economies are of the lowest ranked on the list where as South Africa are number 41 on the list.
Mauritius is the highest rank African Economy at number 20. Interesting enough is that an economy such as Rwanda is ranked above South Africa at number 32. South Africa is then third in Africa at number 41.
Interesting assumptions from this list can be:
- It is fairly easy to deal with construction permits in South Africa, although it can take up to seven months to get your CIBD grading;
- If you need electricity, you are going to struggle in South Africa;
- Registering property in South Africa can be a challenge;
- Getting credit is also not too difficult in South Africa;
- We are good at protecting our investors;
- And paying taxes are South Africans strength.
In all fairness South Africa is not such a difficult place to do business in. One must just have patience and eventually you will pull through in doing business in South Africa.
One way to do business in South Africa is to tender. Visit our website at www.how2tender.com to find out more about our Tender Workshops or purchase our Tender Manual: A practical guide on how to tender.
Until the next time - happy tendering.
