Asia rises up World Bank business ranking

04/11/2010 | Sid Verma

The global crisis has not derailed business reforms in developing economies, with east Asia and the Pacific leading the push this year, according to the World Bank’s flagship “Doing Business” report for 2011

In a report released today, the bank notes that between June 2009 and May 2010, governments in 117 economies implemented 216 business regulation reforms, boosting legal transparency, property rights and bankruptcy procedures. This represents the second highest number of reforms posted by the survey in its eight-year history, while last year saw 250 improvements in business regulation.

“When the global crisis hit, we were concerned that policymakers would be distracted by the financial turbulence or take their eye off the ball. But evidently, this has not happened,” said Neil Gregory, acting director of global indicators and analysis at the World Bank.

The report ranks 183 economies on key aspects of business regulation for domestic firms. It notes a silver lining in eastern Europe’s financial crash, with governments, particularly in the Baltics, taking measures to reform their insolvency regimes. Thanks to better corporate re-organization procedures for firms facing liquidity or solvency issues, the more viable firms have institutional support to continue operating in the event of difficulties, the report notes.

But the most reform-minded region over the past year has been east Asia and the Pacific. Eighteen of the 24 economies in the region – including Indonesia, Malaysia and Vietnam – have taken efforts to ease business start-up regulations, permits and property registration for small and medium-size enterprises. The macro-economic importance of boosting the operating environment for domestic firms has shot up over the past year, Gregory noted. “At a time when Asia faces the challenge of increasing domestic consumption, it is heartening that business reforms are gathering pace,” he said.

India is also one of the 40 most-improved economies for domestic business in the past year, the report notes. Since 2005, India has implemented 18 business regulation reforms in seven areas, principally by leveraging its technological capacity to improve business registration procedures.

Gregory pointed out that technological innovations in developing economies have provided the biggest impetus for reforms this year, from the introduction of electronic filing for taxes, an electronic collateral registry to online submission of customs forms and payments.

Globally, high-income members of the Organization for Economic Co-Operation and Development offer the easiest operating environment for domestic firms while Sub-Saharan Africa and South Asia are the most inhospitable. For the fifth year running, Singapore leads the rankings, followed by Hong Kong, New Zealand, the United Kingdom, and the United States.

Related stories

  • World Bank pledges to work with countries in 'complicated' ...

    Now that the a decade-long economic boom has come to an end, Latin American countries are looking to engage with the World Bank to deal with development challenges amid more complex external conditions

  • Mexican central bank warns on weaker peso but welcomes ...

    Mexico’s deputy central bank governor tells Emerging Markets that overall his country will benefit rather than suffer from rising US interest rates but warns that a depreciation of the peso is a ‘risk’ to the otherwise positive outlook.

  • Robust growth remains elusive for Peru

    Ambition and reforms, Peru has aplenty. But despite getting many things right, it is not being rewarded with strong growth. In the year before the next presidential election frenzy, can Peru get moving again?

  • LatAm must look to private finance to fill yawning infrastructure ...

    Huge. Massive. Vast. Pick any of these words and it would more than adequately describe the need for infrastructure in Latin America and the Caribbean. But having failed to take advantage of the boom years to finance major projects, governments now need to look to the private sector to fill the gap.

  • Latin America faces 'year of reckoning' as growth stalls

    Latin American economists need to grasp the policy challenges posed by a year of “mediocrity” in the face of the slump in the oil prices, a stronger dollar and an expected hike in US rates.


Editor's Picks


In Focus

  1. No pain, no gain: Argentina gears up for necessary adjustment

  2. Deepening Petrobras scandal dogs Brazilian hopes of recovery