On October 27, the World Bank released its mammoth Doing Business 2016 report. The 348-page report evaluates the ease of doing business in 189 countries across the globe across 11 factors: getting electricity (in terms of reliability, prices, and transparency), dealing with construction permits, trading across borders, paying taxes, protecting minority investors, registering property, getting credit, resolving insolvency, enforcing contracts, labor market regulation, and starting a business. From last year to this year, 151 of the countries surveyed made some improvements, and many countries that made strides in their overall score still fell in the rankings as they were outpaced by others’ gains. In other words, it’s not enough for a country to just improve its own business climate; they have to enact reforms at a faster rate than competing economies.
As a whole, Latin America and the Caribbean enacted the fewest regulatory reforms of any of the seven regions in the report, but there are bright spots. Mexico held onto its spot as the top-ranked environment for conducting business in Latin America, with Chile, Peru, and Colombia close behind and all in the top 60 economies of countries surveyed. Meanwhile, Southern Cone giants Brazil and Argentina lag, falling a few notches to 116 and 121, respectively. Bolivia and Venezuela remain in the lower third of economies at spots 157 and 186.
Costa Rica took global honors as the economy that made the most gains from last year’s report, leaping 21 places to spot 58. The gains were due mostly to improved legal rights for borrowers and lenders, as public officials implemented new regulations for more secure transactions, as well as a centralized, online collateral registry that allows for more transparency of assets. El Salvador made similar legal improvements, and the report said the new laws place the two countries in the ranks with Colombia, Honduras, and Jamaica as “pioneers of the modern secured transactions systems.”
Looking back over the last decade, Colombia is Latin America’s standout, having made notable gains in the ease of paying taxes and getting credit in particular. The Andean country reduced the time it takes to pay taxes by 48 percent since 2004 and the number of required tax payments from 70 to 11. Worldwide, Colombia is the second-easiest place to get credit and one of only three economies to notch a perfect score on the strength of legal rights index.
Meanwhile, Brazil ranked 174 in terms of ease of opening a business and 169 in dealing with construction permits. The Western Hemisphere’s second-largest economy also got docked for making it harder to register property in the last year. Brazil’s highest global ranking in the report? Spot 22 for access to electricity.
Below, we look at how major economies in Latin America and the Caribbean moved in the Doing Business rankings from 2015 to 2016.