The “Doing business” report: ideological and political issues

The Doing Business deleted, the facts turned out to be right for Dr. Chérif Salif Sy, who already criticized his insolence in 2013/Photo-Ouestaf News.

Doing Business is here! This annual program of ten indicators was created in 2002 by the World Bank to improve the quality of corporate regulation in the world’s economies and has just been canceled after reports of “irregularities (…) in the data for the 2018 and 2020 editions”, states a statement published about it by the institution on its website on September 16, 2021. Doing Business, considered a “neoliberal” barometer in terms of its methods and its goals, is undoubtedly an impudence underlined on several occasions by voices authorized , such as Dr. Chérif Salifs. Sy, of which Ouestaf News here reproduces a preliminary article, published in 2013, about the true nature of the said program.

By Dr. Chérif Salif Sy*

When you read the Senegalese press, listen to the political class and the vast majority of so-called “civil society” organizations, you get the impression that in the various reports published by the UNDP, the World Bank and other international institutions, there are no problems. other than classification and the processes are completely neutral.

1. When what dazzles does not necessarily shine

Rare are those who, like the statistician Moubarack Lo, go “into” these reports to analyze the determinants of the retained variables as well as the economic and social conditions “suggested” to “be competitive” and who draw the most useful lessons from them . …

In an excellent article on the UNDP’s Human Development Report, entitled “Senegal and the Human Development Index” and published in Wal-fadjri dated February 21, 2009, Mr. Lo writes: “Senegal is once again one of the lowest performing countries on the Human Development Index (HDI). Like last year, it ranks a glorious 156th out of a total of 177 countries surveyed by the United Nations Development Program (UNDP)… two main lessons. First, Senegal not bad in all the components of the synthetic index, which is the HDI. His life expectancy (62.3 years) has improved a lot. It is now almost equal to that of South Asia (63.8 years) and is 13 years older than the African average. Its national wealth (gross domestic product) score is also quite close to the continental average. On the other hand, Senegal is particularly weak in the area of ​​adult literacy, with a rate of 39.3% (compared to 60.3% in Africa south of the Sahara) and education, with a station wagon nered enrollment rate in primary, secondary and tertiary education at 39.6% (compared to 50.6% in sub-Saharan Africa)… The second lesson to be learned from examining the HDI report is that despite makes progress, not in his relative position, but in his overall score. Between 1975 and 2005, it went from a score of 0.342 (out of 1) to a score of 0.499; i.e. a gain of 0.157 points in thirty years and an increase in its HDI of 46% over the period. This means that Senegal is gradually catching up with several African countries that were initially well ahead (Ghana, Uganda, Kenya, Congo, South Africa, Zimbabwe), while losing ground compared to others (Mauritius, Tunisia, Cape Verde, Egypt, Morocco).

In addition, one can complete Mr. Laughed by pointing out that in the 2004 edition of the UNDP Human Development Report, for example, Senegal is ranked 157th out of 177 countries, and it is in 30th place among African countries. However, if we look more closely at the development of the index, from 2001 to 2004, it appears to be one of the 25 countries in Africa making the most progress. Senegal is even ranked as the 10th country that has made the greatest effort, with countries such as Tunisia, Mauritius, Libya, Seychelles ranked between 26th and 35th places. These countries, which in terms of absolute numbers form the leading group in the African ranking. These are the efforts that are the result of a start by all the Senegalese, which continues since, and which recalls Moubarack Lo. It should also be noted, according to UNDP, that our country was among the 16 whose standard of living in 1996 was reached in the early 1960s.

Here, in my opinion, is a way to exploit this kind of documents, which makes it possible to learn useful lessons or even to make the necessary corrections if necessary. We would also like to mention El Hadji Gorgui Wade NDOYE of ContinentPremier.Com for the quality of the refunds he gives us regarding the Davos Economic Report.

2. “Doing business” and employee rights

Doing Business measures business regulation in 183 countries. The classification starting from the best to the worst grades does not inform enough, it dazzles more than it informs. Since these reports are often very useful, it is important to go into the content to fully understand what is at stake.

Based on the principle that economic activity must be based on sound rules, Doing Business believes that “rules are necessary to clearly define property rights and reduce the costs of resolving commercial disputes, to improve the predictability of economic relations and to provide substantial protection to contractual partners against abuse”. These rules must be effective, accessible to all who need them and simple to use. Two types of data are used: on the one hand legal and regulatory texts, on the other hand time and movement indicators that measure the effectiveness of a regulation’s implementation.

Doing Business ranks economies according to 10 indicators of business rules: Starting a business, Issuing building permits, Hiring workers, Transferring property, Taking out loans, Protecting investors, Paying taxes and duties, Cross-border trade, Contract enforcement, Business closure.

The ranking does not take into account macroeconomic policies, security, the professional skills of the population or the soundness of the financial system or financial market regulations.

In a memo dated April 27, 2009, the World Bank stated that the Doing Business indicator of labor market flexibility (which some may view as an encouragement to reduce worker protections) “is not a policy of the World Bank and should not be used as a basis for policy advice or in any country program document”. It committed to remove the indicator in question from the framework of the Facility’s loan conditions. It is therefore the observation that this indicator has been retained in the new 2010 edition that prompted our reaction. Because the World Bank was committed to strengthening social safety nets to protect the millions of workers who lost their jobs as a result of the global economic crisis Why did she maintain this indicator?

In reality, To do business, in order to contribute to creating a good business environment, finds it very difficult to move away from its neoliberal vision, based on market capitalism, which aims to reduce stabilizing economic regulations and social budgets, as well as to open the country to trade and investment. The Doing Business 2010 report recommends that countries scale back severance pay for laid-off workers and reduce or eliminate notice requirements altogether. Instead of calling on countries to improve social protection for workers to mitigate the impact of the global crisis. In other words, employees are a burden whose costs must absolutely be reduced at a time when, in relation to the crisis, systemic risk is avoided.

The theoretical basis underlying this vision is worth recalling: according to the neoliberal view, the market functions per definition perfect, and demand must equal supply, regardless of the good, factor or service in question. if there are problems with labor employment (unemployment), the markets are not responsible. This can only come from the wages that “greedy unions” demand.

The deviation of this theory-ideology has long been demonstrated.

Looking through the 2010 report, it appears that Portugal is downgraded to extending the notice period by two weeks; Cambodia is cited among the countries that “make it difficult to do business” by introducing a social security contribution; Honduras, is criticized for increasing severance pay and notices of termination in response to the economic crisis.

The following countries, for having provided sufficient guarantees in relation to the labor market, are well advanced: Rwanda, because “employers are no longer obliged to carry out prior consultations with employee representatives regarding restructuring, nor to notify the labor inspectorate. » ; Macedonia to get rid of with measures related to the retraining of unemployed workers; Mauritius, for the abolition of compulsory severance pay; Georgia, cited as an example, ranks higher because it abolished the social tax; Belarus is promoted with a high score for implementing policies that facilitate layoffs. It is clear that countries are discouraged from adopting social protection programs by branding governments that do so as “uncompetitive businesses”.

These aspects of the Doing Business report deserve to be known at a time when, through the madness of capitalism, so many people need our support, our solidarity and our compassion. Unfortunately, it will always be possible to downgrade the social protection of workers as long as these international institutions occupy the central place in the determination of policies. Therefore, our countries should negotiate better, involving their experts, especially economists and anthropologists, specialists especially in economic anthropology, which studies forms of production and distribution of goods, and political anthropology, which focuses on forms of authority and power and especially to the formation of political unity, even to that of the state. They have the advantage of knowing better our environments, politics, customs, realities and the society they live in permanently.

Conclusion: Possible dialogue?

The World Bank is a public institution that belongs to all countries. That should enable us to help it move towards even bolder, useful, effective and sustainable reforms for the countries of the South than the IMF, which is less inclined to develop openness to dialogue, would. This may change under the momentum of its current team led by French Dominique Strauss-Kahn. CSS.

*Dr. Chérif Salif Sy, International Consultant, Secretary General of the Senegalese Association of Economists (ASE). Member of the Third World Forum.

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