Highlights from Latest World Bank Ease of Doing Business Report
Written by Lakshmi Nair
Many businesses and governments keep an eye out for this report because it serves as a type of report card that monitors each economy’s progress from year to year and provides an unbiased comparative assessment of business environments from country to country. As such, there’s fierce competition for a place in the upper ranks and many economies are proactively taking measures to increase their rankings in order to attract more foreign business and higher investments.
The following is a quick overview of the highlights from this year’s report:
The Best, The Worst, and The Most Improved
According to the Doing Business 2016 Report, the rankings for the top 10 most business-friendly countries and bottom 10 least business-friendly countries were seen to be largely unchanged from last year. The same countries appear, with slight changes in their ranking order. Singapore continues to hold the #1 position, and the US remains at #7. Eritrea, Libya, South Sudan, and Venezuela were among the least business-friendly countries to run a business.
Overall, 122 economies made positive headway over the past year with regards to business reforms to reduce complexity and costs of regulator processes. Economies that saw the most improvement include Costa Rica, Uganda, Kenya, Cyprus, Mauritania, Uzbekistan, Kazakhstan, Jamaica, Senegal and Benin. Out of a total of 231 business reforms worldwide, these top 10 improvers implemented 39 regulatory reforms to making it easier to do business, according to the report.
Small Steps for Outsourcing Giant, India
India, one of the most popular outsourcing destinations in the world, ranked 130 out of 189 countries, up just four spots from the year before. India’s prime minister, Narendra Modi, has been very vocal about India’s economic growth being a primary focus, and as such has made significant economic and business reforms to improve business and investment atmosphere in the country, including easing foreign-investment limits in some industries and simplifying regulatory processes. Despite these measures, India remains at a relatively low ranking, which highlights a challenge common to many developing economies. Even when economies know and understand the changes that need to be made to achieve progress, they are faced with bureaucratic and political oppositions that slow their efforts.
Although there are well-documented cases of the World Bank report’s shortcomings, especially in terms of scoring economies based on the laws and regulations as they are written, without including any measures for successful implementation and enforcement on the ground, this annual publication remains one of the most respected indexes on economic performance in the world. It effectively documents key indicators and broad trends that highlight areas in need of improvement. It also celebrates the victories of those governments that successfully implement reforms to improve ease of doing business. As such, global businesses can use this report as a general guide to understand which countries are actually making progress from year to year, and which ones are staying stagnant or losing ground.