Electronic services significantly improved business climate
Russia entered the top thirty countries with favorable conditions for doing business
Recently, the World Bank published the results of the annual Doing Business 2020 rating, in which Russia rose from 31st to 28th place. Thus, for the first time, we entered the top 30 countries with the most favorable business conditions.
But this is far from all achievements. In the direction “Obtaining building permits”, Russia has risen over the year by 22 positions, taking 26th place among the 190 countries evaluated. Given the seriousness of competition, this is a real success: the 23rd and 24th places in the ranking in this area are occupied by the United Kingdom and the USA, the 30th and 33rd – Germany and China.
Why rating is needed
Over the past 6 years, not only Russia, but all countries have made significant efforts to change their positions in the World Bank ranking. “This is important because it is a relatively simple and understandable story that allows us to say whether countries are doing something to create a competitive environment in terms of doing business. Moreover, there is a direct correlation between the place in the rating, the dynamics of the rating and macroeconomic indicators, ”says BCG expert partner Konstantin Polunin. – Secondly, it is very important that in Russia, including due to last May’s presidential decrees, systemic measures and tools were created, such as a national entrepreneurial initiative and a national rating of the investment climate, which made it possible to focus the actions of national and regional authorities on promoting this rating. ”
This year, the World Bank emphasized three key reforms that affected Russia’s rating: accelerating the connection of facilities to electricity, including through the organization of a Single Window, strengthening the protection of minority investors and simplifying tax conditions by reducing the time for VAT refunds. The elimination of redundant procedures, simplifying the procedure and reducing the time of procedures, converting services to electronic form, creating information resources and online services for entrepreneurs directly affect the business climate of the country.
Is it possible to say that the reforms carried out by the Moscow construction complex have influenced this jump? Definitely yes. The rating methodology is designed so that the position of Russia is calculated on the basis of indicators of two cities – Moscow (70% of the total assessment) and St. Petersburg (30%). At the same time, experts note that reforms in the construction industry again had the greatest impact on the country’s success in the ranking this year.
According to the World Bank, compared with the previous year, the deadline for obtaining permits in Moscow decreased by more than a month (or rather, by 34.5 days) and amounted to 160 days. Simplification of the procedure for conducting engineering surveys on the basis of the created information resources (Geofund and Consolidated Plan of Underground Communications and Structures) and the access of construction organizations to them also had a positive effect on the rating. The World Bank noted a reduction in terms and other procedures.
“The key factor in improving the performance in the rating was the optimization of technological connection procedures, including as part of a pilot project to convert the services of resource-supplying organizations into electronic form,” the Russian Ministry of Construction noted.
Construction remains the locomotive for the development of the Russian economy
Nadezhda Karavanova, Deputy Head of the Department of Urban Planning Policy of Moscow, emphasizes that construction has shown a high growth rate for the second year in a row: “If the result was improved by 67 positions last year in the direction of“ Obtaining building permits ”, we moved up from rank 115 to 48 “then this year we already occupy the 26th place.”
According to Nadezhda Karavanova, it was possible to ensure such dynamics thanks to the implementation of a whole range of measures in recent years that allowed developers to build faster and easier in Moscow: “Under the instructions of Moscow Mayor Sergei Sobyanin to improve the investment climate in the capital, we were able to eliminate redundant and duplicate procedures, simplify the procedure and the time it takes to translate most of the services in construction into electronic form, and we also created a number of online services convenient for developers. ”
For example, from the end of December 2018, a service for connecting objects to engineering networks became available on the mos.ru portal. Developers filed more than 6 thousand applications for connecting objects to various types of resources.
The deputy head of the department emphasized that work on optimizing the number and timing of the procedures required for the implementation of construction projects will continue. “In order to gain a leading position in the Doing Business rating without compromising the quality and safety of construction, it is necessary to radically revise the system of interaction between government bodies, resource-supplying organizations and developers. This means a transition to a “client path” for the implementation of construction projects, which involves interaction with authorities based on the real needs of the developer, ”Nadezhda Karavanova emphasized. “For this purpose, a digital interaction platform will be created within which all construction participants will be united in a single information environment, which will significantly speed up the construction time.”
Entrepreneurs have experienced the effects of construction reforms
Lyubov Tsvetkova, Chairman of the Board of the Association of Investors of Moscow, is sure: Russia’s position in the World Bank rating is a long way of reforms in the investment and construction sector, carried out by the government of the country as a whole and Moscow in particular. “Much has been done so that investors can make effective decisions at the early stages of the project development: the composition of the GPZU has been expanded, a consolidated plan of underground communications has been formed, and the Geofund data has been digitized. The translation of almost all services into electronic form and the reduction of their terms significantly save the developer’s time. The Moscow government holds many educational seminars and launches electronic services that are also useful in their work, ”says the expert.
Anton Glushkov, President of the National Association of Builders of the Russian Federation, estimates Russia’s growth in the ranking as some kind of information message to investors and market players. “Speaking specifically about the construction complex or developers, two directions are taken into account: the term for issuing a building permit, as well as the simplicity and speed of connection to the engineering infrastructure,” says Anton Glushkov. “These are two topical issues that significantly affect not even the speed of construction, but the attractiveness of projects and their implementation.”
The president of the National Association of Builders also noted that Moscow over the past eight years has been a leader in introducing the maximum number of electronic procedures. “Despite the significant volume of applications and the large number of facilities under construction, the city authorities are leaders in introducing electronic procedures in this part. Therefore, the introduction of a single window regarding accession to the power supply networks in Moscow, which many constituent entities of the Russian Federation are trying to copy now, is also a significant contribution to this part, ”said Anton Glushkov.
he head of the Moscow Territorial Administration of the Etalon Group Maxim Berlovich admits that the Doing Business rating does not fully reflect all the realities of doing business, but this is an important and universal international metric. “The fact that Russia is improving its position in the ranking alongside leading developed countries such as Austria, Japan, France, speaks of significant positive changes in our economy over the past 5-6 years. For the second year in a row, Russia has made a breakthrough in the Doing Business rating, and the changes carried out by the construction complex made a significant contribution to improving the rating. Such progress was made possible thanks to the systematic work of the city authorities to create favorable conditions for doing business, ”says Maxim Berlovich. “For developers who are focused on development, removing unnecessary administrative barriers and simplifying procedures, it means speeding up reinvestment processes and expanding activities.”
Of course, the result that Moscow and Russia showed this year is not the final, there is still room for improvement. Recall that earlier, Russian President Vladimir Putin set the task of ensuring the growth of the country’s positions in the World Bank ranking to 20th place by 2024.
Source: “Moskovsky Komsomolets” No. 28131 of November 21, 2019