How Georgia became the world's best reformer

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041307_reformers_club_conference__2 Last Friday the Georgian leader, Zurab Nogaideli, explained what it takes to reform the business climate:

  • A big effort to curb corruption. As a result Georgia had the biggest drop in corruption in all of Europe – last year in a survey 95 percent of Georgians reported not having to pay a bribe to receive public service
  • Slashing the number of taxes from 22 to 7; a tax rate reduction from 60 to below 40 percent, which more than doubled the revenues. Further cutbacks in payroll and corporate taxes – all from a new single taxation authority – are scheduled for 2008
  • Abolition of most tariffs, combined with a reduction in the time required to import goods from 52 to 4 days
  • Eradication of 756 business licenses and permits. Additionally, government agencies must now process license applications in under 30-days. Starting a business now takes 3 days instead of 10
  • Removal of restrictions on capital flows
  • Lowering of the average time to resolve commercial disputes from over one year to 285 days

Mr. Nogaideli hoped to be able to report on big progress in improving internet penetration in Georgia by next year.

For an example of a country that will not be recognized for improvements to its business climate this year, click here.

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