Korea 8th in business environment

Korea ranked eighth on the ease of doing business list this year, unchanged from a year ago, remaining in the top-10 list for two consecutive years, the finance ministry and the World Bank said Tuesday.

The country was second in terms of enforcing contracts, showing that its judicial system provides effective commercial dispute resolution, a crucial factor for a healthy economy. Asia’s fourth-largest economy performed strongly in terms of getting electricity and trading across borders, ranking third in the two categories.

The Washington-based lender analyzed the business environments of 185 countries by breaking them down into 10 broad categories within the business life cycle that ranges from launch to closure.

The organization praised efforts by the Korean government to protect investors by imposing strict regulations on illegal business practices perpetrated by corporations. It cited the example of SK Group, which was slapped with a $30 million fine in July for illicit transactions.

“The transactions were priced significantly above the market average and allegedly allowed the group’s founder to misappropriate $87 million. Korea’s strong institutions and extensive disclosure requirements played an essential part in addressing this situation and protecting minority investors,” said the bank in its annual Doing Business Report.

Singapore topped the leaderboard for the seventh year in a row followed by Hong Kong and New Zealand. Most economies analyzed have made improvements in their business practices, according to the bank.

The United States came fourth in the rankings, while three European countries ― Denmark, Norway and the United Kingdom placing from fifth to seventh respectively. Georgia was marked ninth and Australia wrapped up the top-10 list.

The report said that entrepreneurs around the world are finding it’s easier to do business today than at any time in the last 10 years _ a trend likely to result in more jobs. Since 2005, the average starting period for a business has fallen from 50 days to 30. In low-income economies, the average has been reduced even further by half.

Poland led the top 10 countries registering the best improvements in the ease of doing business over the last year, followed by Sri Lanka, Ukraine, Burundi, Costa Rica, Mongolia, Greece, Serbia and Kazakhstan.

“We’re seeing that friendlier regulations ― particularly simplifying them and streamlining business regulatory processes ― have a positive impact on job creation,” said Rita Ramalho, a program manager at the World Bank in a statement.

Efforts by developing countries to reform business regulations in the last several years are starting to pay off, says the report, first published in 2003. Over 10 years, smarter business regulation has been seen as supporting economic growth, and simpler business registration as promoting greater entrepreneurship and firm productivity. <The Korea Times/Kim Jae-won>