DOING BUSINESS IN ITALY 2013

1. DOING BUSINESS IN ITALY 2013 Augusto Lopez-Claros Director, Global Indicators & Analysis World Bank-IFC Smarter Regulations for Small and Medium-sized Enterprises Rome, Italy - November 14, 2012

2. Doing Business indicators reflect on some of the most important obstacles firms face Percent of firms identifying the problem as the main obstacle to their business activity • Based on Enterprise Surveys in 118 countries around the world • Direct responses from representative samples of the private sector • Access to finance, electricity, informality and tax rates are the top obstacles across the developing world

3. The Doing Business indicators have a strong theoretical foundation • The Regulation of Entry:Countries that regulate entry more heavily have greater corruption and larger unofficial economies, but not better quality of public or private goods. • Private Credit in 129 Countries: Creditor protection through the legal system and information sharing institutions such as credit bureaus are associated with higher ratios of private credit to GDP. Credit rises after improvements in creditor rights and in information sharing. • Trading on Time: Each additional day that a product is delayed prior to being shipped reduces trade by more than one percent. • Courts: Procedural formalism is associated with higher expected duration of judicial proceedings, more corruption, less consistency, less honesty, less fairness in judicial decisions, and inferior access to justice • The Regulation of Labor: Heavier regulation of labor is associated with a larger unofficial economy, lower labor force participation, and higher unemployment, especially of the young • The Effect of Corporate Taxes on Investment and Entrepreneurship: The corporate tax rate has a large adverse impact on aggregate investment, FDI, and entrepreneurial activity. It is also correlated with investment in manufacturing as well as with the size of the informal economy.

4. Doing Business indicators – 11 areas of business regulation (10 included in the DB2013 ranking) covering 185 economies Entry Property rights Investor protection Access to credit Administrative burden Flexibility in hiring Recovery rate Reallocation of assets 4

5. How does Doing Business measure a country’s ease of doing business? 1 Singapore • The overall ease of doing business: 2 Honk Kong SAR, China (1) Starting a business (2) Dealing with construction permits (3) Getting electricity (4) Registering property (5) Paying taxes (6) Trading across borders (7) Enforcing contracts (8) Protecting investors (9) Getting credit (10) Resolving insolvency 3 New Zealand 4 United States 5 Denmark Top ranked countries in DB2013 6 Norway United Kingdom 7 Korea, Rep. 8 9 Georgia 10 Australia

6. Economies that rank high on the ease of doing business tend to combine efficient regulatory processes with strong legal institutions OECD high-income economies have the most business-friendly regulatory environment on both dimensions

7. Italy’s performance in Doing Business 2013 • Italy, represented by Rome, ranks 73 out of 185 economies on the ease of doing business. • Since 2005 Italy has implemented a total of 14 institutional or regulatory reforms.

8. Italy’s reforms improved various regulatory processes since 2005

9. What do Subnational reports add? • Expand Doing Business indicators beyond the city measured by the annual report • Include rules and regulations at all levels of government • Capture local differences in regulations or enforcement • Provide information on good practices within the same country that can be easily replicated • Give specific locations an opportunity to tell their story • Provide a tool for locations to compete with 185 economies • Combine Doing Business media appeal with active participation of subnational governments in the reform process

10. Subnational reports in over 50 countries Government buy-in Broad coverage • 7 reports funded directly by client governments • 15 economies with 2nd or 3rd-round reports • Over 50 economies included • Over 350 cities covered • BRICs + M included

11. What does Doing Business in Italy 2013 cover? • 4 indicators in 13 cities • Starting a business • Dealing with construction permits • Registering property • Enforcing contracts • Trading across borders indicator in 7 ports • Data collected from 370 contributors is current as of June 2012 Port of Trieste Padua Milan Turin Bologna Port of Genoa L’Aquila Campobasso Rome Bari and the port of Taranto Naples and the Port of Naples Cagliari and the port of Cagliari Potenza Palermo and the port of Catania Catanzaro and the port of GioiaTauro

12. No city outperforms the others in all areas

13. Trading across borders

14. Registering property in Bologna, Naples or Palermo — faster than in Japan

15. Local building permits drive time and cost variations in Dealing with construction permits h

16. Starting a business is fast but expensive

17. It is faster to enforce a contractinTurin

18. Exporting— slower than in the average EU economy

19. Italian cities can learn from each other

20. More new firms are registered after reforms making it easier to start a business

21. Good business regulations and governance In countries where business regulation is efficient and information on documentation requirements and fee schedules is easily accessible, the costs to start a business are much lower.

22. Thank you. For more information:www.doingbusiness.org