On July 27, the World Bank released the thematic report "China's Doing Business Success: Drivers of Reforms and Opportunities for the Future." The report analyzed the reform measures and institutional arrangements that enabled China's success, which was attributed to high-level leadership and ownership of the reform agenda, local policy experimentation, establishment of reform coordination mechanisms, robust private sector participation, and effective communication, etc. As one of the World Bank's sample cities to assess China's business environment, Beijing's reform measures in areas such as starting a business, getting electricity, and dealing with construction permits were promoted and suggested to be adopted both nationally and globally.

88 Reform Measures Adopted by the World Bank in Two Years

In the Doing Business Report, China's ranking has improved greatly from the 78th position in 2018, 46th position in 2019, to the 31st position in 2020. As a result, China has been included among the top 10 global reformers for two years in a row, with the number of reform measures accepted among the top three in the world.

In the thematic report released on July 27, reform measures in China regarding eight indicators have been identified for other economies to learn from. The reforms to improve the business environment in Beijing in 2018 and 2019 have been devoted to the report.

Behind the scenes, three versions of business environment reform plans have been released in Beijing over the past two years. "With a focus on major fields, Beijing has released three successive and updated versions of reform policy plans focused on improving the business environment, with 395 reform measures targeting key and difficult issues of common concern." As introduced by the officials of Beijing Municipal Commission of Development and Reform, the 1.0 version of the reform policy plan focused on areas of the World Bank's 10 indicators of evaluation. Later, the 2.0 version included measures to address common demands and problems raised by enterprises and the public. The 3.0 version was aimed to comprehensively promote reform in key areas and key links of the business environment, with greater emphasis on the systematization, integrality and synergy of the reform.

According to the World Bank reports over the past two years, a total of 88 reform measures in Beijing have been adopted. The performance of the 6 sub-indicators, such as procedures and cost of getting electricity and quality control indicated by construction permit processes, has reached or exceeded the global frontier level. Another 24 sub-indicators, including procedures and time to register property and the reliability of the electricity supply, have surpassed the level of high-income countries in the OECD and become a pioneer of reform both nationally and globally.

In addition, according to the business environment assessment of dozens of Chinese cities, Beijing ranked first for two consecutive years, and 28 reform measures in seven aspects, including starting a business, registering a property, and dealing with construction permits, have been replicated and promoted across the country.

Key Areas Entering "1 Era"

The first to enter "1 Era" is starting a business. Since 2018, Beijing has set up an "E-Window" platform to address common demands and problems raised by enterprises and the public, who claimed that completing the registration procedure required too many steps and too much time to go through different counters and locations. The "E-Window" instead uses big data to connect information isolated islands of individual departments and enables  "a single window online to handle all kinds of related registration and requirements, including business licenses, engraving official seals, applying and receiving invoices, recruitment information acquisition, etc. The process of establishing an enterprise has been simplified from 7 steps to 1 step, which enables the process to be completed within 1 day, a significant reduction compared to the previous 24 days. Therefore, Beijing became the first city to enter the "1 Era" in starting businesses in the country.

Regarding construction permits, despite the complexity that 14 departments are responsible for the application and approval process, Beijing is determined to streamline the process by reducing the required steps and items from 224 to 107, cancelling unnecessary steps with resolution, and merging the steps immediately wherever possible.

Data shows that Beijing has promoted the stationing of 996 administrative services from 54 municipal departments into the service hall, with the city-level occupancy rate reaching 90%. Seventy-two systems of 25 departments have been connected with the single sign-on system of the Beijing Municipal Government service network, promoting the online handling of more than 90% of government service matters at the municipal and district levels, and launching more than 100 "handle on the phone" matters in an innovative way.

In 2018 and 2019, "a single window"offline mechanism came into operation to complete the whole process at one stop. This process originally required visiting three departments responsible for real estate transaction, taxation, and registration. The process of property registration has been simplified from 4 steps to 1 step, which enables the process to be completed in 1 day, compared to the previous 9 days. Property registration between enterprises can be completed in as little as 45 minutes.

"One Step Forward" to Achieve the Target of Reform

In 2020, based on previous reform measures of property registration, Beijing made use of block chain technology to acquire the shared data on 13 categories from eleven departments including public security, civil affairs, etc. As a result, the time needed to review material has been reduced to 2 minutes and the whole process can be conducted online, as payment of tax and registration fees by both parties can be conducted online and electronic property certification can be generated online automatically.

Beijing has made continuous efforts in improving the indicator of getting electricity. In 2018, Beijing took the country's lead to launch the three-zero service, to ensure enterprises need "zero door-to-door, zero approval and zero investment," to access low-voltage power. In 2019, the service was extended to water and gas fields, saving enterprises about 880 million yuan in costs every year. In 2020, the "three zero service" projects of water, electricity, and gas no longer need approval to use the road for digging from departments such as gardening, traffic management, planning, housing and construction, transportation, etc. making the entire process five days faster.

In 2018 and 2019, cross-border trading companies enjoyed five reforms on port facilitation pioneered by Beijing. According to officials, there will be further measures to streamline documents, enhance the level of electronization, and optimize customs clearance procedures in 2020. On one hand, more measures will be taken to expand the scope of release without guarantee for enterprises with advanced certification, implementing the reform of "two-step declaration," and comprehensively implementing the "early declaration" with the rate of early declaration for import and export exceeding  80%. On the other hand, Tianjin Port will promote the paperless reform of the bill of lading, reduce the number of import documents from 8 to 3, and reduce the number of export documents from 6 to 3.

Optimizing the business environment is aimed to create favorable conditions for domestic and foreign enterprises to operate and grow in Beijing, provide stronger support for high-quality economic development, and continue to create a market-oriented, law-based, and internationalized business environment.

Click here to download the original report: China's Doing Business Success: Drivers of Reforms and Opportunities for the Future