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Colombia is now the easiest place in Latin America to do business, according to The World Bank. (Photo: Government of Bogota)
Monday, November 3, 2014
Special Reports

Doing Business: Colombia Best in Latin America

The best and worst ranked on The World Bank’s latest Doing business report.

BY LATINVEX STAFF

Colombia replaced Chile as the best place to do business in Latin America, according to the latest Doing Business report from The World Bank. Meanwhile, Brazil now ranks among the five worst countries in the region, according to a Latinvex analysis of the new data.

The 2015 Doing Business report looks at 10 key factors that measure the ease of doing business in a country. They include starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency.

The World Bank changed its methodology compared to last year, so the changes in the ranking reflect a comparison with the previous ranking using the new methodology.

BRAZIL AND MEXICO

Brazil, Latin America’s largest economy, fell three spots on the global ranking to 120th place. That means it’s easier to start a business in African countries like Zambia and Swaziland than Brazil. Within Latin America, Brazil fell from 10th to 15th place, which means it ranks among the five worst countries in the region.  It now lags behind countries like Dominican Republic, Ecuador and Nicaragua in doing business.

Mexico went the opposite way, improving its global and Latin America rankings. According to The World Bank, Mexico now ranks 39th worldwide in ease of doing business, up four spots from last year. That means it’s easier to do business in Mexico than countries like Belgium and the Czech Republic. Within Latin America, Mexico inched up from fourth to third place, ahead of countries like Peru.

COLOMBIA AND PERU

Colombia now ranks as the easiest place to do business in Latin America after jumping 19 spots globally – from 53rd place last year to 34th this year. It made registering property and getting credit easier.

“Colombia made transferring property easier by eliminating the need for a provisional registration,” The World Bank says. “In addition, it improved access to credit by adopting a new secured transactions law that establishes a functional approach to secured transactions and a centralized, notice-based collateral registry. The law broadens the range of assets that can be used as collateral, allows a general description of assets granted as collateral, establishes clear priority rules inside bankruptcy for secured creditors, sets out grounds for relief from a stay of enforcement actions by secured creditors during reorganization procedures, and allows out of court enforcement of collateral.”

However, on the negative side, it made paying taxes more difficult. “Colombia made paying taxes more complicated for companies by introducing a new profit tax (CREE), though it also reduced the corporate income tax rate and payroll taxes,” The World Bank says.

THE LEADERS

Apart from Colombia, Latin America’s top five countries in ease of doing business include Peru, Mexico, Chile and Panama. They all beat countries like Italy and Luxembourg.

Guatemala has Central America’s best business environment, followed by Costa Rica.

THE LAGGARDS

Venezuela ranks worst in Latin America and among the eight worst countries worldwide, ranking behind countries like Angola, Congo, Guinea-Bissau and even Myanmar.

In Central America, Nicaragua now has the worst business environment, according to the Doing Business report from The World Bank.


© Copyright Latinvex




Doing Business: Best & Worst

LA RK

Ch

GL RK

Ch

Country

1

2

34

19

Colombia

2

35

-1

Peru

3

1

39

4

Mexico

4

-3

41

-2

Chile

5

52

3

Panama

6

73

-2

Guatemala

7

82

-8

Uruguay

8

83

-5

Costa Rica

9

2

84

Dom. Rep.

10

-1

92

Paraguay

11

4

104

-4

Honduras

12

109

-3

El Salvador

13

3

115

Ecuador

14

-1

119

7

Nicaragua

15

-5

120

-3

Brazil

16

-2

124

-5

Argentina

17

157

-6

Bolivia

18

180

1

Haiti

19

182

1

Venezuela

NOTES: Change based on new methodology

LA RK=Latin America rank

GL RK=Global rank

Sources: 2015 Doing Business, The World Bank;
Latinvex (Latin America ranking, changes)


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