Incremental improvements and new methodology nudged Thailand up in the World Bank’s annual rankings of the easiest countries to do business in released Wednesday.
While the kingdom's ease of doing business ranking plummeted from 18 last year to 26 in the new Doing Business 2015: Going Beyond Efficiency report, the World Bank's International Finance Corp noted that this year's survey employed new methodologies to set rankings. With those factored in, the kingdom actually improved two points to 26.
Shoppers check out at a retail store in Bangkok. Thailand has made incremental improvements to its business environment to allow it to edge up on the World Bank’s annual ranking of the easiest countries to do business in. (Reuters photo)
The bank also cited further improvements to its business environment over the past year.
"Through its public-service improvement program over the past 10 years, Thailand has implemented reforms to improve the ease of doing business. This has benefited local entrepreneurs, who now have fewer regulatory hurdles to deal with and more resources to focus on their business," Ulrich Zachau, country director for Thailand said it a statement. "Thailand has also used technology to improve the regulatory environment for businesses. For example, the use of electronic systems has reduced both the number of documents and the time needed for exporting and importing by almost half since 2007."
The report said Thailand ranks among the top 30 economies in the world in five areas: dealing with construction permits (sixth worldwide), obtaining electricity (12th), protecting minority investors (25th), enforcing contracts (25th), and registering property (28th).
The report also cited the country's effort to streamline the issuance of construction permits.
"Thailand made dealing with construction permits less time-consuming by introducing a fast-track approval process for building permits for smaller buildings," the report stated.
Despite incremental improvements, Thailand still lags its Asian rivals. Singapore again ranked first in the world for ease of doing business while Hong Kong ranked third, South Korea fifth, Malaysia 18th, and Taiwan 19th.
Shipping containers are moved at Laem Chabang port. The world bank said Thailand has successfully used electronic systems has reduced both the number of documents and the time needed for exporting and importing by almost half since 2007. (Bangkok Post photo)
"The data show that many economies in the region made it easier for businesses to pay taxes in the past year," the bank said, citing several examples other than Thailand.
"Vietnam reduced the corporate income tax rate. China enhanced its electronic filing and payment system - while also making business incorporation less expensive. Mongolia introduced a new electronic payment system. Such reforms are saving entrepreneurs valuable time."
Malaysia, in particular, showed the most progress in the important "distance to frontier" scale, that shows how close each economy is to global best practices in business regulation, the bank said.
"Through an ambitious reform agenda, Malaysia has gradually improved the ease of doing business. This has benefited local entrepreneurs, who now have fewer regulatory hurdles to deal with and more resources to focus on their business," report author Rita Ramalho said in a statement.
The World Bank stressed that Thailand's gains came mostly from methodological changes. The new survey expands the data for three of the 10 topics covered. In addition, the ease of doing business ranking is now based on the "distance to frontier" score. Finally, the report included data from two cities in countries with populations of more than 100 million.
A graph from the World Bank’s Doing Business 2015 report shows the “distance to frontier” that shows how close each economy is to global best practices in business regulation. Thailand ranked 26th, but showed virtually no progress since last year. (World Bank Doing Business 2015: Going Beyond Efficiency)