Between Liberia and Bolivia

The World Bank called Ukraine one of the worst places in the world for paying taxes. The evidence of this is “Doing Business” rating issued by the World Bank. According to its information, Ukraine is the 181st out of 183 countries in the tax payment rating. The reasons for this are the number of payments (135), tax administration time (657 hours per year) and the general tax burden on business (57.1 percent).

The domestic economy has also gone down to the 180th place in building permits acquisition with very high permitting duration rates of 375 days. The situation with power supply connection is considered unsatisfactory (169th place). The situation with the property registration is not better (166th) place. At the same time the level of investor protection remains unsatisfactory (111th place) whereas the Ukrainian government has not made any changes in it.

In general, according to the World Bank, this year Ukraine is at the 152nd place out of 183 for doing business, between Liberia and Bolivia. In its report the World Bank emphasized that Ukraine has carried out four structure reforms over the last year. Regardless of this, some of the showings of our country are nearly the worst in the world. We remind our readers that in 2010 and 2009 Ukraine took the 145th and 147th places in this rating, respectively.

The opposition comments the decline of Ukraine in the World Bank rating as the evidence of the disastrous policy of the current government and the complete inefficiency of the reforms carried out by the government for one and a half years now.

“It is significant that in the general rating “Doing Business-2012” Ukraine goes after Liberia ruined as a result of the long civil war. Such countries as Burkina-Faso, Gambia and even Honduras have outstripped us. The rating is an evidence of the complete failure of the governmental economic policy and the inefficient reforms carried out by the government over one and a half years,” UNIAN quotes the Head of the Parliamentary Committee on Regulatory Policy and Entrepreneurship Natalia Korolevska.

Will the assessment of the governmental reformation policy by the World Bank influence the plans of Ukraine for the European integration? We will shortly find this out. However, according to the preliminary conclusions it is unlikely. Brussels has repeatedly complained that ratings do not always reflect the situation correctly. Moreover, the European politicians have been expressing their dissatisfaction with similar assessments and predictions criticizing them for their consequences. In particular, as a result of a decline of credit ratings of several countries the pressure on the government bonds intensifies and the financing terms worsen.

Deutsche Welle informs with reference to Financial Times Deutschland that the European Commissioner for Internal Markets and Services Michel Barnier has recently declared his intention to prohibit in the course of work the international rating agencies from publishing their credit rating predictions for crisis countries under certain circumstances. In particular, he suggests giving the European Securities and Markets Authority (ESMA) the right to temporarily prohibit rating agencies from announcing their credit rating predictions. It concerns the countries negotiating about the provision of financial assistance from the European Financial Stability Facility or the International Monetary Fund. This prohibition is supposed to prevent rating decline “at a very inconvenient time” that can lead to “negative consequences for the financial stability of a country and destabilize the world economy.” Reuters informs that Brussels is going to start discussing Barnier’s initiative by the end of November.