Rankings on Ease of Doing Business in Southeast Asia

Ease of Doing Business in SE AsiaSoutheast Asia is a hot market for business. There is untapped potential, both in terms of consumer demand and labour markets. With all eyes on Asia, it is important to focus your capital and team where you generate the greatest return on your investment. Which means getting into the details of every country’s laws: ease of setting up a business, access to credit, construction permits, registering property, taxation laws. This can be daunting, not to mention time consuming. Which is why we have come up with a few metrics that will give you a head-start on some high level knowledge on a few chosen countries in SEA.

The countries we have chosen are: Singapore, the Philippines, Malaysia, Indonesia, Thailand and Vietnam.

The metrics we have chosen are from the ease of doing business rankings published by the World Bank Group. They are: overall ease of doing business, starting a business, dealing with construction permits, getting electricity, registering property, getting credit, paying taxes, enforcing contracts, USD equivalent of a worker in retail/restaurants. For a thorough understanding on how the World Bank Group creates these rankings, you can read the explanation here.The data for rankings and number of procedures has been taken from World Bank Group’s Doing Business publication.

Ease of doing business
Singapore 1
Malaysia 18
Thailand 26
Vietnam 78
The Philippines 95
Indonesia 114

Singapore ranks first on the ease of doing business. This is not surprising. Since its independence, Singapore has positioned itself as a leader in doing business in SEA. By reducing bureaucratic procedures and taking the entire process online, Singapore has lived up to its top position for many years now.

Starting a Business
Singapore 6
Malaysia 13
Thailand 75
Vietnam 125
Indonesia 155
The Philippines 161

This metric is considered by measuring the number of days it takes to start a business. According to the World Bank Group, it takes 3 days to start a business in Singapore while in the Philippines, it takes 34, which gives you a good idea as to why the rankings look like the above. In the Philippines, much of the time is wasted moving from one department to another. It takes 16 independent procedures to start a business.

Dealing with Construction Permits
Singapore 2
Thailand 6
Vietnam 22
Malaysia 28
The Philippines 124
Indonesia 153

Indonesia ranks the lowest. It takes 17 procedures to obtain a construction permit in Indonesia while Singapore requires you to complete 10 procedures.

Getting Electricity
Singapore 11
Thailand 12
The Philippines 16
Malaysia 27
Indonesia 78
Vietnam 135

Vietnam has an average of 10 procedures taking 34 days while Singapore has 4 taking 31 days.

Registering Property
Singapore 24
Thailand 28
Vietnam 33
Malaysia 75
The Philippines 108
Indonesia 117

On average, Indonesia has 5 procedures, taking 25 days, while Singapore has 4 procedures, taking 4.5 days.

Getting Credit
Singapore 17
Thailand 89
Vietnam 36
Malaysia 23
The Philippines 104
Indonesia 71
Paying Taxes
Singapore 5
Malaysia 32
Thailand 62
The Philippines 127
Indonesia 160
Vietnam 173

This statistic is by far the most extreme. The total number of tax payments in Singapore is 5 per year which takes about 82 hours in the year whereas Vietnam has 32 payments per year which takes about 872 hours.

To understand more about taxation laws on some countries in the APAC region, you can read about it here for Singapore and for the Philippines.

Enforcing Contracts
Singapore 1
Thailand 25
Malaysia 29
Vietnam 47
The Philippines 124
Indonesia 172

In Singapore there are 21 procedures for enforcing contracts which takes about 150 days whereas Indonesia has 40 procedures, taking about 451 days.

Corruption Perception Index
Singapore 84
Malaysia 52
Thailand 38
The Philippines 38
Indonesia 34
Vietnam 31

The corruption perception index is a measure of how people within the country view the public sector. The index is relative to every other country on the list. It ranges from 0 (weakest perception) to 100 (cleanest perception).

Considering the countries we have chosen, it is pretty obvious why Singapore stands out. It is one of the most mature markets in SEA. The other countries are still in a developing stage. Singapore stands more as a reference point on these lists. Many of the SEA nations are held back by the large number of bureaucratic procedures and rampant corruption.

In addition to these factors, we should also consider the cost of doing business, in terms of labour, land and capital costs. There is a trade-off between cost and efficiency which we have avoided considering in order to bring out the basic metric of ease of doing business in SEA.

Hope this was helpful and relevant for your business! Watch out for more posts on rankings in SEA.

If you are in need of a payroll solution for your business, check out our Southeast Asia offerings here – PayrollHero.Asia

– – Related Posts – –

Doing Business in the Philippines

Where does South East Asia rank on Maternity Leave?

baby photoEmployee benefits are a growing concern for human resource (HR) administrators. South East Asia (SEA) lags behind the global average in terms of providing employee benefits. However, when it comes to maternity leave, the situation has been improving.

According to the International Labour Organization’s report: Maternity and paternity at work: Law and practice across the world, there has been a shift towards increasing maternity leave periods that go further than the 14 – week standard suggested by ILO. However the coverage is neither sufficient nor long enough for mothers before they have to get back to work.

SEA ranks in the middle to lower half in terms of length of maternity leave. On average, around 12 to 13 weeks are given as leave.

Singapore: the Ministry of Manpower lays down conditions for eligibility of maternity leave. This leave can be paid by the employer or can be reimbursed by the government. The length of the leave depends on certain conditions. A maximum of 16 weeks is allowed if the following criteria are met:

  1. The child will be a Singapore citizen
  2. The mother is legally married to the father of the child
  3. The mother has worked in the same establishment for a minimum of 3 months.

The last condition is mandatory for eligibility. MoM also takes into account the number of children the mother has to judge eligibility and coverage.

Malaysia: The 1955 Employment Act gives mothers 60 days (8 weeks) of maternity leave as long as the employee has worked in the company for 90 days prior to taking leave. The employer needs to pay the employee in full during leave. There are certain concessions for civil servants. Malaysia does not provide maternity leave for the sixth child and following children. Because of the short leave provided, mothers often work up to the due date in order to spend time with their child during leave.

Indonesia: Three months (or 12 weeks) of paid leave are given to mothers. At least 1.5 months of this leave must be taken after the birth of the child.

The Philippines: Article 133(a) of the Labour Code states that an employee who has worked in the establishment for at least 6 months is entitled paid leave 2 weeks before the due date and 4 weeks after delivery. The employer is required to pay for only the first four children.

Under SSS law, a woman member of the SSS is entitles to maternity benefits. While the employer must pay these benefits to the employers, it can be reimbursed by the SSS. In order to abail the Maternity Benefits, the employee must pay at least 3 monthly contributions within the year before the semester of childbirth.

Thailand: An employee is entitled to 90 days (or 12 weeks) of maternity leave. However, the employer must pay a maximum of 45 days. The remaining 45 days are paid from the Social Welfare Fund. In order to avail payment from the Social Welfare Fund, the employer is expected to make contributions to the Fund for at least 7 months before pregnancy.

Here we have a list of countries and the maternity leave that they offer:

Duration Countries
< 12 weeks ·         Hong Kong

·         Malaysia

·         Papua New Guinea

·         Philippines

·         Taiwan

12 – 13 weeks ·         Cambodia

·         China

·         DPRK

·         East Timor

·         Indonesia

·         Laos

·         Myanmar

·         South Korea

·         Thailand

14-17 weeks ·         Brunei

·         Japan

·         Singapore

>  17 weeks ·         Mongolia

·         Vietnam

Source of Cash Benefits: Historically, Asia has seen a higher percentage of the maternity leave being paid by the employer. However, the trend is moving towards cash benefits coming from mixed sources: from the employer and social security services. To put this in perspective, Europe, a region that has led the way for right of the employee, has always provided cash benefits from social security.

Paternity Leave: Rights offered to fathers are fairly limited. Countries offer just a couple of days of paternity leave as a shared provision between parents. Usually this leave is taken by the mother. Sometimes this leave is not paid. Approximately 28% of countries in Asia provide paternity leave.

Adventure Engineering in Da Nang, Vietnam

Editors Note: Introducing Vincent Paca, Adventure Engineer at PayrollHero. He will be contributing to the PayrollHero blog from time to time.

Not so many months ago, a talkative fellow wandered in my small Cebu office by chance. Dressed in shorts, flip flops and a black shirt with a man in a red cape. Turned out that was Mike Stephenson, CEO of PayrollHero. He talked about adventure, learning, teamwork and improving one’s self and the next thing I knew I was on a plane to Manila two days later to pair with a few of their engineers. A little under a year and here I am, in Singapore, busting out a blog post about the adventures and misadventures of Adventure Engineering.

Adventure engineers often travel depending on the client’s need. We go wherever we can be more effective at our job. Being ridiculously client focused, as we always say. (yes, we are hiring)

Da Nang, VietnamOne of the things that we wanted to try out this year was to partner up with 3rd party engineering teams to help us increase our velocity. In comes AgilityIO, a 150-strong engineering team based in Da Nang, Vietnam. We believe that a lot of problems can easily be solved when you’re in the same room together with your team. Making the communication loop so much shorter meant making things move faster.

At the beginning of April, Adam, Mike, Piotr and I decided to meet up in Da Nang, Vietnam to personally meet and work with team Agility. Adam, and Mike flew in from Singapore, Piotr arrived from Whistler and I catapulted all the way from Manila.

Getting to Da Nang is no simple task. Flying from the Philippines meant that I had to take a flight to either Hanoi or Saigon, then take another domestic flight to central Vietnam. I landed in Saigon around 12am bags in hand waiting for my next flight at 5am. DO NOT fly at these hours. Saigon domestic airport closes at night and the earliest they open is at four in the morning. I had to stay outside of the building and wait for it to open. Fun times indeed. I arrived in Da Nang around 6:30am. Being in Vietnam also meant that we had to wake up an hour earlier. Our daily huddle always happens at 6:47am GMT+8 and no, it doesn’t matter where you are.

I downed a can of RedBull and a shot of Cà phê sữa đá and headed to AgilityIO’s office with Piotr. Agility has a HUGE office in Da Nang, 5 floors of mobile and backend developers, it seemed like they had it all. We knew from the start that this wasn’t going to be a breeze. Communication and getting your thoughts across was definitely a challenge, but we didn’t let that wall stop us from where we’re going. We’re now two weeks into the project that we’re working with Agility and we’re almost near completion.

piotr, vince and agility team in da nang

A selfie with some of the Agility team in the background

Da Nang wasn’t all work and no play. We went for a food tour around Da Nang at lunch time. Summer from Funtastic Food Tour took us around Da Nang to its secret foodie gems scattered all around the city.

The next day we hopped in a cab and ventured to Hoi An. Our first stop was the Marble Mountains. The Marble Mountains is a cluster of mountains made of, you guessed it, marble. Going up one of the mountains wasn’t that difficult. Partly because the local government attached a modern elevator to the side of the mountain that takes you up halfway of the mountain.

(Adam, Piotr, Mike and myself)

(Adam, Piotr, Mike and myself)

Scaling the peak wasn’t all that bad either. All that marble makes for perfect steps when crawling up to the peak.

da hang, vietnam marble mountain stairsWe just made it in time for lunch at our hotel and just enough time to prepare for our motorbike tour around the countryside of Hoi An. This was the very first time I learned how to ride a motorbike and surprisingly enough it wasn’t that bad. Vuong took us around the scenic countryside of Hoi An, we rode on floating bridges, elevated bamboo bridges and along the rice fields. Exhilarating and enjoyable, the whole 5 hour ride was quite the experience.

bike tour around da nang

Finishing at 7pm left me little time to prepare for my 9pm domestic flight to Hanoi to get to Manila. Even though I left Vietnam a bit exhausted with mud on my shoes and a little bit of dirt here and there, I had a really great time. 10/10 would definitely do again.

Want to read more about our Adventure Engineers? Check out Nico’s story from when he left Manila to work from the Whistler office while getting his Canadian residency.

Interested in joining our team? We are always hiring!

What is an Adventure Engineer?

PayrollHero Team Retreat – Saigon, Vietnam

Ad-ven-ture En-gi-neer-ing
Noun: An unusual and exciting, experience or activity built around a flexible work schedule. 

The PayrollHero team had a retreat this weekend in Saigon, Vietnam. Vietnam is a quick flight from Manila and a fantastic place to visit.  We brought our Whistler team and Manila team together and popped over to Saigon.

At PayrollHero, we believe in “Adventure Engineering” and are committed to not only offering flexible work schedules so that team members can take advantage of “snow days” in Whistler or take “long” weekends to bounce around Southeast Asia but to see the world together. (more on adventure engineering below)

This weekend in Saigon, we fed monkeys and alligators, rode scooters, crawled through the Cu Chi Tunnels, ate frogs, saw the war museum and so much more.

We flew photographer Kris Krug in from Vancouver to document our journey through his lens.  Kris is a rockstar photographer and this is not the first time we have brought him along on a PayrollHero trip.  Last time we did this was to LAUNCH in San Francisco.

Here are just a couple of his photos from Saigon, but to see the whole collection, pop over to our Facebook page and check them out.  Let us know which is your favorite!

PayrollHero Co-Founders Stephen Jagger and Michael Stephenson

Most of the PayrollHero team

Adventure Engineering – We figure there is a small segment of engineers out there who value a challenging and adventurous life. These people tend to share a lot of our core values which we try and reflect in our company with Adventure Engineering:
  • Work from Whistler or Manila (Mountains and Beach / Snow Cones and Mango’s).
  • Have a very flexible schedule so you can explore and play. (Snow and surf days).
  • Learn a ton by travelling and bringing experts to us.
  • Get outside and play together. Season pass and Physical trainers.
  • Eat and drink together; meals at the office and offsite pub nights.
Are you looking for an “adventure engineering job”? Get in touch with us to chat more about what we are up to and how you might fit in to our unique environment.
Stephen Jagger on the Vespa Foodie Tour
PayrollHero Lead Engineer Piotr Banasik going down into the Cu Chi Tunnels
Michael Stephenson firing an AK-47