Iran’s National Business Environment Index came in lower in the second quarter of the current fiscal year (June 22-Sept. 22) compared with the previous quarter, according to the results of a study undertaken by Iran Chamber of Commerce, Industries, Mines and Agriculture.
The index stood at 6.4 points this summer, down from Q1’s score of 6.15, ICCIMA reported on its website.
The index measures business friendliness of Iran’s economy, with 10 indicating the worst grade.
“Unpredictability and fluctuations in raw material prices”, “uncertainty about policies, rules, regulations and business formalities”, and “difficulties with getting credit” were the most undesirable factors affecting Iran’s business environment during the period under review, according to the findings of the study.
On the other hand, “access to electricity, gas and diesel” and “access to the Internet and mobile phone network” and “access to water” were identified as the three most prominent factors in improving the environment.
The chamber also measures the index for each of the 31 Iranian provinces. The report named Lorestan, Kermanshah and Chaharmahal-Bakhtiari as the provinces with the worst environment to do business in, and Gilan, East Azarbaijan and Zanjan provinces as the best.
The industrial sector had the worst business environment in Q2 followed by services and agriculture sectors.
As for different fields of business, the worst three were “art, recreation and entertainment”, “wholesale, retail and repair” and “mining”. The top tier includes “finance and insurance”, “real estate” and “water supply, wastewater management and water treatment”.
Enterprises with six to 10 employees had the worst business environment while those with 101 to 200 employees had the best business environment.
Businesses established of 11 to 15 years ago indicated the worst business environment while those of fewer than two years were the best.
The ICCIMA index is fashioned after World Bank’s “Ease of Doing Business” index, the new edition of which will be released next week.
The latest World Bank report showed Iran ranks 124th among the 190 economies, indicating a four-notch slide in Iran’s regulatory improvement compared to the preceding edition of the report.
The country’s overall distance to frontier score was put by World Bank at 56.48, compared to 57.26 in the previous report.
An economy’s distance to frontier is indicated on a scale from 0 to 100, where 0 represents the lowest performance and 100 the frontier, the World Bank reported on its website.
The annual report covered regulations affecting 10 areas of the life of a business measured between June 2016 and June 2017, namely starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency.
