The term “Ease of Doing Business” may sound straightforward, but it actually represents a great deal more than most think. It describes both the quantity of business regulations in a particular country or region, as well as the overall quality of those regulations. To put it another way, it’s an attempt to pinpoint how easy or difficult it can be to run a business in a particular place compared to other geographic locations you might be exploring.
Every year, a number of leading organizations publish reports that factor ease of doing business into an overall ranking of countries, allowing businesses that are in the process of expanding to gain more insight into their general competitiveness. The World Bank’s Annual Doing Business Report is just one example of this type of publication. The World Economic Forum does something similar, although this example goes beyond ease of doing business in its overall ranking structure.
All of this is important to know, as it can provide insight into how difficult and/or costly it will be to perform basic functions, such as:
- Starting a business
- Dealing with construction permits
- Registering property,
- Paying taxes and more.
With all that in mind, here are the countries that are known for their ease of doing business.
Singapore’s Ease of Doing Business
Singapore takes second place in the World Bank’s Ease of Doing Business Index, making it one of the most attractive countries to either start a business or expand current operations. New businesses can complete registration, submit an optional company seal, and sign up for employee compensation insurance within 72 hours. It also received high marks for enforcing contracts, paying taxes, getting electricity, and registering property, among other distinguishing factors.
A number of regulation reforms helped Singapore earn the number-two spot, including simplified and transparent employment procedures. Singapore has also strengthened its transport and port infrastructure, making it easier to trade across borders. It introduced a new restructuring procedure to make resolving insolvency easier, and amended its Companies Act, requiring locally-incorporated and foreign companies registered in Singapore to maintain beneficial ownership information and to make that information available to the public when requested.
The United Arab Emirates‘ Ease of Doing Business
The UAE has long been an attractive destination for companies looking to expand into the EMEA region. The latest report found that the UAE improved across all metrics and continues to outpace other countries in the Arab World. Its increase in diversification has strengthened its macroeconomic environment, and has helped it stave off the worst of economic shocks due to lower oil and gas prices. While the UAE’s GDP is projected to dip to 1.3% in 2018, the country’s non-oil sectors are projected to grow—a sign that its departure from a largely oil-driven economy is beginning to pay off.
Switzerland’s Ease of Doing Business
Switzerland claims the number-four spot for institution rank and takes sixth place for infrastructure on the World Economic Forum’s Global Competitiveness Report for 2017 and 2018. The country offers strong results that are easily balanced across the various components that affect competitiveness. It also excels in terms of fundamentals like public health, primary education, and its own macroeconomic environment. The economy offers an almost unparalleled level of flexibility and its labor market is one of the most high-functioning in the world. That last point is particularly critical in terms of attracting the type of talent a business would need to thrive in the global economy.
The Netherlands’ Ease of Doing Business
The same report highlighted The Netherlands’ top rankings, with the country taking seventh place in its institutional rankings and third in infrastructure. The Netherlands offers a strong education system and a high level of tech readiness among both businesses and individuals, and a thriving ecosystem founded on innovation. That innovation ecosystem, according to World Economic Forum, puts The Netherlands in a position to positively shape the Fourth Industrial Revolution over the next few years.
New Zealand’s Ease of Doing Business
One of the countries companies may want to consider during their global expansion journey is New Zealand. This report highlights the gap between an economy’s performance when compared to a measure of best practice across all 41 indicators listed. To that end, New Zealand actually ranks highest, requiring both the smallest number of procedures to start a business with one, and the shortest required time to fulfill them at just 0.5 days. New Zealand also ranked highly in terms of things like dealing with construction permits and building a quality control index, the total number of days required to register property (one), the strength of legal rights in terms of getting credit, and more.
Other Ease of Doing Business Findings
The Doing Business 2018 Reforming to Create Jobs report cites both Europe and Central Asia as two regions that have made significant progress in terms of ease of doing business by way of recent reforms. A full 79% of all economies in these areas have recently implemented at least one regulatory reform to help make things easier for companies to expand globally, and their activity over time shows that this continues to be a massive priority for these countries. While issues like Brexit are certainly a factor in Europe, this is still news to be celebrated. South Asia and Sub-Saharan Africa are two regions that actually follow very closely.
The Path to Global Expansion Begins Today
In the end, it’s important to remember that expanding your business is always a delicate tightrope act to walk; growing too quickly can, in many cases, be just as devastating in the long-term as not growing at all. The countries on these lists represent incredible opportunities—but you still need a partner that can help your organization compliantly expand at the right rate. And Velocity Global’s full suite of global expansion services is designed to help you do precisely that. Reach out to Velocity Global today to learn more about how we can help you think beyond borders and establish your global presence.