ECONOMY

Ambitious plan to slash red tape

The government plans to cut bureaucratic procedures for setting up companies in an attempt to improve its record of providing one of the least friendly business start-up environments in the world, it said yesterday. Development Minister Costis Hatzidakis said a draft law is being prepared that will soon be tabled in Parliament and will reduce the number of steps required to set up a business from 18 to just four. «The government has decided to move ahead with a concrete and measurable plan,» he told reporters after a Cabinet meeting. «These are not just words, they are specific steps.» Despite repeated government announcements in the past to combat red tape, it remains one of the most commonly cited reasons by foreign investors for sidestepping Greece. The other ones are inflexible labor laws and corruption. The World Bank has given Greece one of the lowest scores when it comes to the country’s heavily regulated business start-up procedures. According to the World Bank, 15 separate steps are needed to set up a business in Greece. Brunei and Uganda come next on the list with 18 steps. In sharp contrast, entrepreneurs can start up their own venture in Canada and New Zealand via a single procedure. The economy has been paying a hefty price for accommodating an overinflated public sector that forces businesses to chase after a long paper trail. Data from the United Nations Conference on Trade and Development (UNCTAD), show foreign investment in Greece slumped 64 percent in 2007 from the previous year to 1.9 billion US dollars. Other steps the conservative government is preparing in order to boost competitiveness include a series of labor market reforms beginning in the fall, Economy and Finance Minister Yiannis Papathanassiou said recently. [email protected]