The best and worst places in the world to do business
China advances while UK falls to ninth place in the latest World Bank ease of business ranking
New Zealand has once again nabbed the top spot in a World Bank report on the ease of doing business around the world.
After being overtaken by Georgia and Norway, the UK is the ninth easiest country in the world to do business, falling from seventh place last year. The US also fell two spots, dropping to eighth this year.
For the third consecutive year, New Zealand, Singapore and Denmark occupied the top three positions, while Somalia again came bottom of the rankings.
The annual World Bank study examines the red tape that affects small and medium-sized enterprises across several areas, including opening and registering a business, paying taxes, and trading across borders.
The rankings are “closely watched” by businesses and policy makers around the world, with countries frequently orienting their domestic reforms around attempts to raise their position, says the Wall Street Journal.
The three most improved countries this year were Djibouti, Afghanistan and China, with Beijing in particular making significant efforts to cut regulation in the last year.
It has been a “remarkable” year for China in terms of regulatory reform, Rita Ramalho, senior manager from the World Bank’s global indicators group, told the Financial Times. “Normally they do one to two reforms, this year they have seven areas of reform,” she said. “The intensity has increased significantly.”
Shanta Devarajan, acting chief economist at the World Bank, said the diversity among the top improvers “shows that economies of all sizes and income levels, and even those in conflict” can advance the business climate for domestic small and medium enterprises.
Despite being highly regarded by businesses and governments around the world, the rankings have faced criticism from aid agencies who argue that they reward countries with high levels of inequality.
The bank’s former chief economist Paul Romer has expressed concern that repeated changes to the methodology of the report “had allowed World Bank staff to unfairly push some countries higher or lower in the rankings, even when their business environments hadn’t changed,” the WSJ says.
The newspaper adds: “An external audit found the report hadn’t been manipulated for political purposes, but the World Bank took some of the criticisms to heart: There were no changes to the report’s methodology this year, and the bank has committed to making updates to its methodology only once every five year.”
The top ten:
- New Zealand (top)
- Hong Kong
- South Korea
The bottom ten:
- Somalia (bottom)
- South Sudan
- Democratic Republic of the Congo
- Central African Republic