What were the most frequently reported barriers identified through the survey.

Business Environment

 

What were the most frequently reported barriers identified through the survey.

Case Studies

CASE STUDY (20Marks)

Measuring the Results of Donor Supported Business Registration and Licensing – The case of Minas Gerais in Brazil Minas Geraisis one of Brazil’s 26 states. It is the fourth largest state in the country and the second most populous. The state’s capital and largestcity, Belo Horizonte, is a major urban and finance centre in Latin America and is the sixth largest urban agglomeration in Brazil. The government Descomplicar initiative, meaning “uncomplicate”, was launched in 2007 to promote a policy environment that is conducive to economic development. The program had four goals: Improve relationship between state and private sector; Simplify

regulation and reduce bureaucracy; Encourage firm formalization; and Promote economic development. The Descomplicar initiative established a series of working groups around specific program themes: 1. Information campaign: This theme sought to promote the importance of business registration through education campaigns and the distribution of booklets to informal business owners. The media campaign also involved direct work in schools and universities. 2. Bureaucracy reduction: This theme sought to simplify the procedures for starting, maintaining and closing a business, with an emphasis on small and medium enterprises. It included support to all the municipalities in Minas Gerais in the creation of a synchronized business database. 3. Tax guidelines: This theme developed material that described the different conditions for the small and medium enterprises, showing the benefits that businesses receive from government and serves as an enticement to formalization. Government considered it especially important to disclose information on the origin and destination of taxes collected and to create awareness among entrepreneurs of their importance to society. 4. Increased surveillance: Attention was given to educating informal employers about their extralegal status. State and local governments improved their surveillance of the informal sector and distributed the abovementioned booklets on the importance of formalization and its benefits for the business and for society. 5. Financial barriers reduction: Attention was also given to facilitating access to government supported credit lines in an attempt to improve access to credit. Given high levels of informality among firms, a goal of Descomplicar was to encourage firm formalization. To this end, the program conducted a survey of informal firms to obtain information on the barriers to formality from the firm perspective. The most frequently reported barriers identified through this survey were: High tax burden; Too much bureaucracy; High costs of firms registration; Lack of financing; and Lack of information about benefits of being formal. One of the first reforms was to simplify business registration through the creation of a one stop shop for completing municipal, state, and federal registration procedures at the same time and at the same place (known as “Minas Fácil”). Different layers of government mean municipal inspectors don’t enforce state and federal registration. Thus, firms can be partially formal, i.e., complying with local laws, but not state or federal laws. However, through the one stop shop, firms automatically obtain state and federal registration when they obtain a municipal operating license. However, despite this initiative, many firms remained informal. Investigations found that many informal firms were not aware of the simplified process and that there was very little information on the benefits of formalization. Impact evaluation In response, the World Bank and the State of Minas Gerais undertook an impact evaluation from 2010 to 2012 to build knowledge on what works and what doesn’t when fostering the formalization of firms, and to use this knowledge to refine policies intended to facilitate formalization among firms in Minas Gerais. This project used a randomized experiment to evaluate the impact of the policies implemented under Descomplicar. The impact evaluation would help refine Descomplicar policies. The evaluation sought to measure which of the following three interventions is most effective at encouraging firm formalization: Intervention

1: Information Brochure: Providing information on the costs and benefits of formalization, financing sources, as well as on the simplified registration process. Intervention

2: Information Brochure and Free Registration: Providing the information above as well as paying registration fees for firms.

Intervention

3: Stepping up tax inspections and enforcements. If firms formalize as a results of these interventions, it was also possible to measure the impact of formalization on firm performance. In January and February 2011 the study first conducted an exercise to obtain a list of informal firms located in 605 city blocks. Then, in April 2011, it randomly assigned these blocks into

three groups based on the three options described above. Control groups of firms that did not receive any of the three possible interventions were also formed. This allowed for the measurement of spillover effects within blocks by comparing control firms in intervention blocks to firms in control blocks.

Answer the following question.

Q1. What was Descomplicar initiative? Explain

Q2. What were the specific program themes to uncomplicate various issues.

Q3. What were the most frequently reported barriers identified through the survey.

Q4. Explain the interventions chosen for encouraging firm formalization.

CASE STUDY (20 Marks)

Asia had emerged as the destination for medical (healthcare) tourism capitalizing on advantages of “lower cost skilled personnel,cultural factors, natural endowments and unique forms of medicine.” The targeted consumers were patients from developed nations where medical treatments were expensive and the waiting lists long. By providing medical services to foreign customers, these countries were not only generating valuable foreign exchange, but were also creating employment opportunities. Thailand was the leader in the region, followed by Singapore and Malaysia and India as the preferred destinations for medical treatment The benefits

of foreign exchange, employment and growth in national income, which extended well beyond the medical, travel and tourism sectors attracted government interest across Asia, and efforts to attract medical tourists added to the growth of the industry Though Asian countries provided cheaper medical services, they were also perceived by some as being manned by low quality doctors who provided poor quality treatment. Pricing of the treatments and packages across the region varied. Experts opined that the over emphasis on the foreign patients who offered higher revenue compared to domestic patients can be detrimental to public healthcare services in the home country. Despite the issues and challenges, the region had vast opportunity for growth The case describes the growth and reasons of the Asian region as a preferred destination for Medical/Healthcare Tourism and the importance of the healthcare tourism industry in the Asian economies. The case details the issues and challenges for the countries in servicing the patients. The case ends on the discussion whether such emphasis on healthcare tourism was diverting the attention and resources of the government from the domestic healthcare needs, especially public health. With such competition and challenges, would Asian countries be able to capitalize on the opportunity and at the same time fulfill the social obligation of healthcare at home

Answer the following question.

 

Q1. Discuss the growth and reasons of the Asian region as a preferred destination for Medical/Healthcare Tourism and

 

the importance of the healthcare tourism industry in the Asian economies.

 

Q2. Analyze the issues and challenges for the countries in servicing the medical tourist patients

 

Q3. Debate whether such emphasis on healthcare tourism was diverting the attention and resources of the government from the domestic healthcare needs, especially public health.

 

Q4. Debate whether with such competition and challenges, Asian countries will be able to capitalize on the opportunity and at the same time fulfill the social obligation of healthcare at home

CASE STUDY (20 Marks)

Case Study: DELL – Energy Management (Enterprise Solution – Minimum of 200 Desktops – Technology Innovation) Synopsis Dell embarked on an energy efficiency program that aimed at conserving energy and cutting expenses by reducing the power used by approximately 50,000 of its computers during non business hours. 1E’s Night Watchman® and 1E WakeUp® were deployed to the 50,000 client computers that fully integrated with Dell’s corporate Microsoft® Windows Server® and Microsoft Systems Management Server (SMS) environment. As a result, Dell achieved a 40 percent reduction in energy costs, translating into US$1.8 million in savings per year. The use of 1E Night Watchman® is a great example of how an organization can effectively implement energy management practices that reduce energy consumption and operating costs. Though cost savings are more noticeable for larger corporations, 1E Night Watchman® is just as relevant to smaller organisations with as few as 200 PCs. Featured Organizations Dell is a multinational technology corporation that develops, manufactures, sells and supports personal computers and other computer related products. 1E solutions and services help automate and simplify IT operations and reduce complexity, management cost and power consumption costs. By providing leading edge

solutions with its expertise 1E has earned the trust and confidence of over 15 million licensed users across 1,100 businesses in 42 countries worldwide. The Problem to be Addressed Energy conservation is an increasingly important issue for all organizations.

Answer the following question.

 

Q1. Explain how Dell achieved a 40 percent reduction in energy costs.

 

Q2. Give your views on the case.

CASE STUDY (20 Marks)

In 2003, Britain accumulated a lot of credit. According to a Bank of England report, credit card lending formed 7.16% of the total lending to individuals of the UK for the month of September 2003. Along with the increase in credit card lending, credit card debts also increased. The Bank of England revised its interest rate to keep a check on the increasing amounts of debt and inflation. The credit card lenders are dealing aggressively with their customers by going to the courts and also engaging bailiffs. They are also selling the debts to the debt collection agencies.

Answer the following question.

 

Q1. Discuss how the problem of accumulating credit card debt is contributing to the increase in the nonperforming assets of banks and creating a vicious cycle in the economy

 

Q2. Explain what steps the Bank of England can take to deal with the problem

 

What were the most frequently reported barriers identified through the survey.

 

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