Colombia enacted the most business reforms of any Latin American country in the last year, says a new World Bank report.
Chile remains the most business-friendly country in Latin America,
but Colombia did the most in the region in the last year to improve their
business climate, according to an annual World Bank report.
Based
on performance June of last year to June of this year, Colombia has
become “like one of the global leaders” in its drive to improved the
conditions for doing business within its borders, said the sixth edition of the World Bank’s “Doing Business” study.
Colombia lept 13 places overall to settle at 53rd in the world, second
in the region behind Chile. The rise was lead by relative improvements
in ‘Trading Across Borders’ and ‘Paying Taxes’, though the second
remains ranked among the worst in the world, at 141 of 181 economies.
“The
countries of Latin America and the Caribbean are contiually more
committed to programs of reform, and Colombia and El Salvador are key
examples,” said Sylvia Solf, principal author of the report.
The study credited the rise, in part, to “progressively
reducing the corporate income tax rate, from 35 to 34 percent in 2007
and 33 percent in 2008.” Other factors were increasing operating hours
at the countries ports while lowering the number of inspections,
increasing disclosure requirements to protect investors, and a new It
introduced an electronic tax filing system, cutting the average time
businesses must spend on tax compliance each year by 188 hours, or 41
percent.
However, as the report itself admits: “The Doing Business methodology has limitations.”
The
areas not studied by Doing Business include: ” a country’s proximity to
large markets, the quality of its infrastructure services (…), the
security of property from theft and looting, the transparency of
government procurement, macroeconomic conditions, and the underlying
strength of institutions.”
The study also notes: “To make the data comparable across countries, the indicators refer to a specific type of business — generally a limited liability company operating in the largest business city.”