Regulatory Environment Reform
In many Asian countries, the most significant obstacles to business activity and expansion emanate from poor governance. Businesses often face burdensome licensing and opaque registration requirements, volatile law-and-order conditions, endemic rent-seeking behavior and corruption, and insecurity in the enforcement of contracts. Within this environment, small businesses which have more limited access to capital and political connections tend to carry a disproportionately heavy burden. Facilitating a level playing field that allows small businesses to prosper is important in generating employment, increasing opportunities for women and the poor, and ensuring globally competitive exports and supply chains.
The Asia Foundation's strategy to support investment and enterprise has three primary components: analysis, advocacy, and public-private dialogue. Research and analysis leads programming to identify the key impediments to business growth in defined geographical areas such as cities or provinces. In Bangladesh, Cambodia, and Sri Lanka, highly detailed studies of specific business communities were undertaken to better understand those local business environments. In Indonesia, the Philippines, Vietnam, Cambodia and Sri Lanka, the Economic Governance Index (EGI) serves to identify those aspects of governance that determine the investment and enterprise competitiveness of localities. Moreover, the results of the EGI feed into collaborative processes among government, business, and civil society, to reform regulations that constrain investment and the growth of private enterprise.