Entrepreneurship becomes easier globally

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CORONAVIRUS IMPACT

2013 Doing Business report shows that local entrepreneurs around the world are considering it easier to do business nowadays than at any time in the past 10 years. Also, a research indicates a link between simplifying the business start-up process and growing firm creation and job creation.

Entrepreneurs around the world believe it is easier to do business today than at any time in the last 10 years. This is a trend which will probably lead to more jobs creation.

That is the main point of the recently revealed joint World Bank and IFC 2013 Doing Business Report, which is an annual measure of 185 economies on the ease of starting and operating a local business.

Singapore was number one in the global ranking for the seventh year in a row (see the list of top 10). Most of the measured economies have registered improvements in the business climate. Since 2005, the average time of the start-up business process has dropped from 50 days to 30, while in low-income economies the average has been cut by half.

Poland is the leader among the top 10 economies making the biggest improvements in terms of doing business easing over the last year. It is followed by Sri Lanka, Ukraine, Uzbekistan, Burundi, Costa Rica, Mongolia, Greece, Serbia, and Kazakhstan.

Here are Doing Business Top 10 Economies:

1. Singapore

2. Hong Kong (China)

3. New Zealand

4. United States

5. Denmark

6. Norway

7. United Kingdom

8. Republic of Korea

9. Georgia

10. Australia

According to Rita Ramalho, program manager Doing Business Unit at the World Bank Group, simpler and streamlined business regulations, along with technology developments such as online business registration, make it easier to start a business than it was eight years ago. She further commented that better business regulations, especially simplifying them and streamlining business regulatory processes, have a positive effect on job creation.

Ramalho also gave an example with Mexico’s move to simplify business registration in the early 2000s which resulted in a 5% growth in registrations and a 2.2% growth in employment. She also said that the research shows a link between simplifying the business start-up process and a growth in firm creation and job creation. She also pointed out that on average, the countries with improved business regulations as measured by Doing Business register higher growth rates.

The report, which was first published in 2003, indicates that the efforts of developing countries to improve business regulations in the last several years are starting to pay off. Over 10 years, more efficient business regulation has been considered to boost economic growth, and easier business registration has been seen as supporting greater entrepreneurship and firm productivity. Moreover, lower-cost registration has made formal employment opportunities a little brighter.

The Doing Business is about smart and efficient business regulations, not necessarily fewer regulations. A fact of note is that a number of African economies are among the 50 that have made the most improvement since 2005.

Eastern Europe and Central Asia were some of the most active regions among Organisation for Economic Co-operation and Development (OECD) countries, at least as far as business climate is concerned.

Continued economic uncertainty in the aftermath of the financial crisis is another factor contributing to the reform. Among OECD countries, Portugal, Italy, Spain and Greece boosted the speed of their business regulatory reform in the past year, and Greece is among the top 10 most improved.

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