How the World Bank ranks countries for investors

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Companies invest where they feel it’s most profitable and financially secure, thus it is usually in developed countries or those which show a steady fast emerging economy. And the best place to check rankings is the World Bank.

They take their time to examine investor protection laws of almost every country in the whole world and rate them accordingly.

They take into consideration many factors; these include:

• How easy it is to start a business: it goes from how many procedures the entrepreneur has to do, how long it’ll take, how much it costs and the least amount of capital needed.
• How easy it is to deal with construction permits: it is also measured through amount of procedures, days, cost and building quality control index.
• Ease of getting electricity and its reliability: it takes into account procedures, time, cost and how reliable and transparent the service is.
• Property registration: procedures, days, cost and quality of the land administration index are considered.
• Difficulty level of getting credit: it is measured by the strength of legal rights index depth of credit information indexes.
• Whether it protects the minority investors or not: they examine the following indexes: extent of disclosure, extent of director liability, ease of shareholder suits, extent of shareholder rights, extent of ownership and control and extent of corporate transparency.
• Taxes: the ranking considers how many payments the company has to do per year, the time it takes to pay them, total tax rates and post-filing index.
• Ease of trade across borders: they check the documentation and border compliance of time and cost to export and to import.
• Easiness of contract enforcement: time, cost and quality of judicial processes index are examined.
• Solving insolvencies: recovery rate and strength of insolvency framework index are its two main indicators.

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Emily