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In tune with BusinessProgramme for a business-friendly
environment in Hungary
CSERNENSZKY LszlMinistry of Economy and Transport, Hungary
Conference on the European Charter for Small
EnterprisesBled/Brdo (Slovenia), 3-4 June 2008
Hungary in WB Doing Business
2007 2006 change
Ease of Doing Business 45 51 -6
Starting a Business 67 91 -24
Dealing with Licences 87 88 -1
Employing Workers 81 94 -13
Registering Property 96 101 -4
Getting Credit 26 21 +5
Protecting Investors 107 105 +2
Paying Taxes 127 124 +3
Trading Across Borders 45 42 +3
Enforcing Contracts 12 12 -
Closing a Business 53 52 +1
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In Tunewith BusinessProgram Why?
Objective:Reduction of compliance,
operational and transaction costsof enterprises to an
unavoidable
minimum level
EU Objective:Administrative costs to be
reduced by 25% until 2012.
Administrative costs amount toabout 4.5-6.7% of the GDP in
Hungary while the EU-25
average is 3.5%
Administrative burdens related tonational legislation amount
to
about HUF 1000 bn. They should
be reduced by HUF 100 bn onaverage per annum in the comingfive
years.
Two focuses of the governmentalprogramme
cutting administrative burdens emerging fromout-of-date state
regulation
decreasing additional costs and lossesresulting from the
imperfect market operation
due to inadequate regulations and/or lawenforcement
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In Tune with BusinessHow?
Market Transparencyand Fair Competition
4 measures
Simplification of CompanyRegistration & Tax
Administration
13 measures
In Tune with Business Program together with Deregulation
Programwas approved by the Government in April, 2007
Legal Security andEnforcement5 measures
Other Proposals5 measures
33 measuresFinancial OperationalConditions6 measures
Action plan
Simplification of tax and contribution declarationsConsolidation
of declarations and payments
Making use of electronic procedures
Mid-term task
Short-term partial results
Improvement of administrative procedures
E-governmentMore professional bureaucracy
Elimination of redundant data collection
Tasks for over a year
Results within a year
Decreasing chain debtsImprovement of debt management
Accelerating return of acknowledged debtsPublic procurement
legislation
Tasks for over a year
Results within a year
Accelerating payments from buyers
Examination of opportunities todetermine maximum payment
deadlines by law
Tasks for over a year
Results within a year
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Accessibility of company related informationCompany data via
Internet,
Positive reference data, precautionary data
Mostly within a year
Rules on bankruptcy and liquidationAcceleration of
procedures
Banktruptcy law for sole proprietors
Organisational changes foreffective coordination of actions
against
black economy and corruption
Simplification of businesses establishmentMaking business
establishment faster and cheaper,
lower start-up capital requirements
Development of informationdissemination on regulations
Good partial results
Mostly within a year
Partial results
Mostly within a year
Partial results
Mostly within a year
Success
Mostly within a year
Substantial delay
Lessons (recommendations):
Business sector government partnership
Inter-ministerial and agency cooperation
Project implementation (organisation andprocedures ->
co-ordination)
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Lessons (warnings):
To avoid
- hesitations
- too much compromises
To solve- Good and motivated staff
Inspirations
Doing Business surveys (World Bank)
World Competitiveness Yearbook (IMD)
Global Competitiveness Report (World
Economic Forum)
Better regulation (EU NL, UK, DK, DE)
Reducing red tape (OECD USA, NZ, AUS )
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Summary for policy makers
Clear vision needed + a champion withinthe government
Consultations and stable partnership
Long term commitment
Measurement strategy organisationalguarantee (monitoring,
pressure)
Human resources
