Twelve best economies to start a business 2018
New data suggests the global business regulatory environment has changed dramatically in recent years. Per the World Bank Group, 119 of the 190 economies measured in the report Doing Business 2018 have enacted at least one business regulation reform in the past year. Of these, 79.8 percent implemented at least one reform for a second consecutive year and 64.7 percent have done so for a third.
Why is business regulation important? It can encourage entrepreneurs to enter an economy where the rules governing start-ups are accessible, transparent and predictable. This, in turn, benefits the economy, boosts capital investment and job creation, and generates more choice for consumers.
Online marketeers Reboot Digital Agency delved into research to discover the best economies to start a business in 2018, in the hope it will offer insight to both budding entrepreneurs and seasoned businessmen/women. To accomplish the research, Reboot utilized data from the World Bank Group. Data considered included the paid-in minimum capital requirement, the number of procedures required—such as obtaining all necessary licenses and permits and completing any required notifications, verifications or inscriptions—and the time and cost for a small to medium-sized limited liability company to start up and formally operate in economy’s largest business city.
Reboot Digital Agency found New Zealand to be the number one economy to start a business in, with a Distance to Frontier (DTF) rating of 99.96. Though New Zealand’s rating has decreased by 0.18 percent on 2017 figures, it still presents the strongest case in starting a business in 2018. In fact, it would take just one procedure, half a day and less than one percent of income per capita to start a business in Auckland.
DTF measures the distance of an economy to the “frontier,” which represents the very best performance across all economies and years included since 2005. An economy’s distance to frontier is indicated on a scale from 0 to 100, where 0 represents the lowest performance and 100 the frontier.
Other economies that rank in the top five for starting a business include Canada (DTF: 98.23), Hong Kong (DTF: 98.14), and Georgia, with a distance to frontier score of 97.84 supported by an increase of 2.12 percent on 2017 figures. Jamaica lands in fifth place with a DTF of 97.3.
Economies that continue to rank in the top 12 but present no change on 2017 figures, include Australia (DTF: 96.47) and South Korea, with a distance to frontier score of 95.83.
Comparably, two economies which have experienced positive change are Kosovo (DTF: 95.67) and Uzbekistan (DTF: 95.54) with vibrant growth of 4.98 percent and 4.46 percent respectively, on 2017 figures.
Missing out on the top 12, the United States ranks in 49th place, with a distance to frontier score of 91.23; presenting no change on figures in 2017. On American shores, it would take six procedures and four days to start a business in New York City, a stark contrast to New Zealand’s Auckland which takes the number one spot.
“It’s encouraging to observe populist countries, like Georgia, Kosovo and Uzbekistan experiencing vibrant growth,” said Shai Aharony, managing director of Reboot Digital Agency. “It hints we are heading toward a rich, multicultural time in business, which will no doubt encourage us to venture to areas anew, to start-up or network. Some may even argue it will become essential to do so. I’m sure we will see continued change in the sector as businesses reform and push beyond old boundaries.”