The “doing business” report: ideological and political issues

The Doing Business deleted, the facts proved right to Dr. Chérif Salif Sy who already criticized his impertinence in 2013/Photo-Ouestaf News.

Here lies Doing Business! Created in 2002 by the World Bank to improve the quality of business regulation in the world’s economies, this annual program with ten indicators has just been canceled after reports of “irregularities (…) in the data of the 2018 and 2020 editions “, indicates a declaration published to this effect by the institution on its site on September 16, 2021. Doing Business, considered a “neoliberal” barometer by its methods and its objectives, undoubtedly pays an impertinence underlined on several occasions by voices authorized like that of Dr Chérif Salif Sy whose Ouestaf News reproduced here a premonitory article, published in 2013, on the true programmed nature.

By Dr Chérif Salif Sy*

Reading the Senegalese press, hearing the political class and the vast majority of so-called “civil society” organizations, one gets the impression that, in the various reports published by the UNDP, the World Bank and other institutions international, there are no issues other than classification and the processes are totally neutral.

1. When what dazzles does not necessarily illuminate

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

In an excellent article on 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 making one of the least performing countries on the Human Development Index (HDI). It ranks, as for last year, in the not very glorious 156th place out of a total of 177 countries examined by the United Nations Development Program (UNDP)… two main lessons. First, Senegal is not bad in all the characteristics of the synthetic index that is the HDI. His life expectancy (62.3 years) is much improved. It is now almost equivalent to that of South Asia (63.8 years) and is 13 years older than the African average. Its score on national wealth (gross domestic product) is also quite close to the continental average. In Senegal, Senegal is particularly weak in the area of ​​adult literacy, with a rate of 39.3% (compared to 60.3% in sub-Saharan Africa) and education, with a combined enrollment rate for primary , secondary and higher education by 39.6% (against 50.6% in sub-Saharan Africa) … The second lesson that can be drawn from the examination of the HDI report is that Senegal, despite everything , progresses, not in its relative ranking, but in its 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 which were initially well ahead of it (Ghana, Uganda, Kenya, Congo, South Africa, Zimbabwe), while at the same time losing ground. compared to others (Mauritius, Tunisia, Cape Verde, Egypt, Morocco)”.

Moreover, one can complete Mr. Lo by pointing out that in the 2004 edition of the UNDP report on human development, for example, Senegal is ranked 157th out of 177 countries and it is in 30th place among African countries. But, if we look closely at the evolution of the Index, from 2001 to 2004, it appears to be one of the 25 countries in Africa which are progressing the most. Senegal is even ranked 10th country having made the most effort, where countries like Tunisia, Mauritius, Libya, Seychelles are ranked between 26 and 35th places. These countries which, in the ranking in absolute figures, constitute the leading pack of the African ranking. These are the efforts resulting from a start of the whole of the Senegalese which continue since and which recall Moubarack Lo. It should also be noted, according to the 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 of exploiting this type of document, which makes it possible to draw useful lessons or even make the necessary corrections, if necessary. We will also mention El Hadji Gorgui Wade NDOYE of ContinentPremier.Com for the quality of the restitutions he gives us concerning the Davos Economic Report.

2. “Doing business” and employee rights

Doing Business measures business regulation in 183 countries. The classification which starts from the best to the worst grades does not inform enough, it dazzles more than it enlightens. 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 considers that “rules are needed to clearly define property rights and reduce the costs of resolving commercial disputes, to improve the predictability of economic relations and to provide essential protection to contractual partners against abuse”. These regulations must be effective, accessible to all who need them and simple to apply. Two types of data are used: on the one hand, legislative and regulatory texts, on the other hand, time and movement indicators that measure the efficiency with which a regulation is implemented.

Doing Business ranks economies according to 10 indicators of business regulations: Starting a Business, Granting Building Permits, Hiring Workers, Transferring Property, Getting Loans, Protecting Investors, payment of taxes and duties, cross-border trade, contract enforcement, business closure.

The ranking does not take into account macroeconomic policies, security, 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 states that the Doing Business indicator on labor market flexibility (which some might consider an encouragement to reduce worker protection) “does not a policy of the World Bank and should not be used as the basis for policy advice or in any document relating to country programs”. It has made a commitment to remove the indicator in question from the institution’s loan conditions framework. It is therefore the observation that this indicator has been maintained in the new 2010 edition that has 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 it maintain this indicator?

In reality, Doing business, in order to help create a good business environment, is having great difficulty in departing from its neoliberal vision, based on market capitalism which aims to reduce stabilizing economic regulations and social budgets as well as the opening the country to trade and investment. The Doing Business 2010 report recommends that countries scale back severance pay for laid-off employees and reduce or eliminate notice requirements altogether. Instead of urging countries to improve social protection for workers to mitigate the impact of the global crisis. In other words, the employees constituting a burden whose cost must absolutely be reduced at the moment when, relative to the Crisis, the systemic risk is eliminated.

The theoretical foundations underlying this satisfying vision need to be recalled: according to the neoliberal conception, the market, by definition, functions perfectly and demand must equal supply, whatever the good, factor or service in question. cause ; If there are labor employment problems (unemployment), the markets are not responsible. This can only come from the wages demanded by the “greedy unions”.

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

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

The following countries, for having given sufficient guarantees in relation to the labor market, are well promoted: Rwanda, because “employers are no longer required to carry out prior consultations with employee representatives concerning restructuring, nor to notify the labor inspectorate. » ; Macedonia, for getting rid of measures related to the retraining of unemployed workers; Mauritius, for repealing mandatory severance pay; Georgia, cited as an example, ranks higher because it abolished the social tax; Belarus by implementing policies facilitating summary dismissals is promoted by a high score. Clearly, countries are discouraged from adopting social protection programs by branding policing governments as business “non-competitors”.

These aspects of the Doing Business report come to light, 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 revise the social protection of workers downwards as long as these international institutions take center stage in determining policies. Therefore, our countries should negotiate better, by involving their experts, particularly economists and anthropologists, specialists in particular in economic anthropology who study the 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 better knowing our environments, the politics, the mores, the realities and the society in which they live permanently.

Conclusion: Possible dialogue?

The World Bank is a public institution that belongs to all countries. It should enable us to help it move towards even more courageous, useful, effective and sustainable reforms for the countries of the South than the IMF, which is less inclined to develop openness to dialogue, does not allow. This may change under the impetus of its current team led by the 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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