BY ABEBE WOLDEGIORGIS
Recently the Addis Ababa Chamber of Commerce held discussion with stake holders and during the meeting participants said that, the extended rules and regulation introduced with regard to business deterred the incoming of foreign investment.
The bureaucratic hurdles created by duplicated rules paved the way for the rampant corruption. It is also said that even though some measures are taken to revoke the rules, there is still regulation which hampers speedy business. According to the participants weak execution capacity on the part of the public offices contributes a lot for misconduct.
Mihreteab Luel is a lawyer who presents study paper during the discussion. As to him, the business activity in Ethiopia is highly vulnerable for unnecessary scrutiny which discourages people to involve.
A foreign business man before open business here it asses what look likes of the business environment.
As to the study conducted by his company, in Ethiopia the market is subjected to heavy supervision as the result, business men faces hardship.
For example, the supervision existing in the finance sector is exceptionally the most complicated.
As to his experience, heavy financial supervision is conducted in Kenya for hunting money laundering utilizes for striking terrorism not to inhibit business activities. Whereas, in Ethiopia everything with regard to business is tightly controlled by unnecessary rules which shy away business men.
As to Mihreteab, when tightly control rules are introduced, getting service from public institutions will be worsen. He believed that there is no politeness in the civil servants and such situation makes laws dysfunctional. . There are laws introduced in the public offices but the public is not familiar with and such situation aggravates corruption.
Therefore, to provide speedy service simplifying working activities is vital and the idea was suggested to the government officials long ago.
The duplicated laws unless they are reduced they create enabling environment to corrupted officials to meet their subversive objectives. He also told that the home grown economic reform introduced two years ago has its own weakness and lag behind the foreign investor’s interests. This was proved by his company studies.
The other paper presenter is Professor Fekadu Petros.
As to him, the government in the last five years has tries its level best to improve the laws which hampers business activities and the administrative law introduced two years ago is the outcome of the improvement measures. The new law plays pivotal role in reducing unnecessary supervisions.
On the other hand, the dialogue made between the government and the private sector based on the public private partnership can be mentioned as exemplary.
The other thing mentioned by him is that the implementation of packages in relation with “ease of doing business.”
He further said that the administrative law introduced recently explains that all public offices obliged public offices that whenever they introduce new rules that they should abide by the procedure.
Therefore, whenever governments institutions are introduce rules, they are obliged beforehand to inform to the pertinent bodies. They are also required to send the draft law to the stake holders to be commented. And lastly they are required to send the draft law to the Ministry of Justice for endorsement.
The objective of the new procedure is to enact better law which can accommodate all stakeholders’ interests. After the rules are finally ratified they will be posted on the institute website to be observed in a transparent way by all.
However, As to Fikadu, the law is not properly implemented and the recently published study conducted by the Ministry of Justice clearly indicate this.
According to the study the Ministries of Finance, Health, Revenue and the tax commission failed to implement the law. On the other hand, he said that public – private relation must be strengthened because it creates conducive environment to settle problems that the private sector faces but to date only little progress is shown.
As to Fikadu, ease of doing business is one of the best criterions to attract foreign investment recommended by the World Bank which utilizes to compare 189 counties in the world. It also announces the level of the countries in this regard annually. In this criteria Ethiopia is on 150th level and in the last four years to upgrade Ethiopia’s status the government has made a lot of efforts.
To up hold the efforts the reform committee comprised the government officials led by the Prime Minister was established. The recently introduced trade law attributed to this effort. The reform enables doing business virtually with no physical contact in addition, other measures improved the business environment and based on the recent evaluation Ethiopia’s status on the World Bank criterion in easing doing business was expected to Upgrade to the 100th level but due to the undisclosed reason the World Bank gave up the criterion.
Mihreteab on his part also told that the introduction of new investment code has brought a tremendous impact in ease doing business. The announcement of the
1958 New York convention to be part of Ethiopia’s civil code which was delayed for about 25 years has been taken and Ethiopia become signal of it. This shows the government resoluteness to improve the business environment in accordance with the international standard. Fikadu on his part said that, to reduce the extended laws which hampers speedy business activities, establishing regulatory impact assessment organ by the government is essential. In this regard many countries could resolve their problems through the regulatory body. In the normal circumstance any government body when it introduces laws it discusses the matter with the pertinent institutions but through regulatory impact assessment system any government organ wants to formulate rules it first send the draft to the central government organ. Because the central organ has sufficient human resource including cutting age technology. The other countries experience shows that in the impact assessment organ comprises professionals such as socialists, economist’s, historians and lawyers. Countries such as Marshes, Egypt, Kenya, Senegal, Uganda and Kenya introduced regulatory impact assessment. As compared with the Public- Private partnership, regulatory impact assessment initially makes effort to formulate qualified law. In such system each institution which has regulatory body make inventory in common and the pertinent official who has a responsible to explain the new law has an obligation to explain. If he fails the institution will be cancelled from the regulation system and such approach can bring solutions.
The introducing of administrational procedure law is encouraging and exploiting such good opportunity is vital. However, still there are a lot to be done with regard to improving laws.
As to Fikadu, enacting law by itself is crucial and help full for strengthening the private sector. In 2013 EC many anticorruption laws are introduced concerning the private sector. Liberalization of the financial sector is can be said encouraging. Though weakness is witnessed in implementing, the law the government has strong interest in this regard. Even though regulatory program introduced for its effective ness there should be strong civil service reform.
Without strong civil service realizing the objective is unthinkable. Recently the government announced that there are more than 100 thousand employee with fraud educational documents in the civil service and this is by itself is a challenge for the nation wellbeing and unless the situation is reversed to the better whatever the reform implementation is futile.
THE ETHIOPIAN HERALD TUESDAY 2 AUGUST 2022
