The extension of BizClim II is up and running

While some ACP countries have achieved success in improving their business and investment climates, all are now faced with a myriad of new challenges stemming from regionalization, globalisation and policy changes that significantly impact on developing economies. A large number of countries continue to lack the conditions for a business and investment-friendly climate. This hampers doing business and investing, and leads to economic inefficiency and low investment productivity. 

The past decade has witnessed a renewed interest in other determinants of economic growth than the macro-economic. Although regulatory reforms have received heightened attention, the need for the creation of an overall enabling environment is well recognized. In its “agenda for change”, the EU defined its model for building a partnership with the private sector, highlighting the need for better business environments and public-private dialogue.

BizClim adheres to a broad definition of the business climate, which refers to the "influences and pressures exerted by external factors on the business". Such factors, including the social, political, economic, regulatory, tax, cultural, legal, and technological environments, influence decision-making on resource use and capabilities,. The determinants of an enabling environment are diverse and quite often depend on complex factors and country-specific circumstances. At a broader level, they may comprise:

  • political stability and macro- economic circumstances;
  • the legal and regulatory system;
  • bureaucracy and banking system investment protection;
  • long-term certainty around the investment structure and associated incentives - "rules of the game" (such as market access and competition, protection of property rights and contract enforcement).

At a narrower level, they comprise determinants that address barriers specific to sector investments, the ease of establishing a business, sector policies, investment promotion and facilitation.