According to the World Bank’s ranking of the most business-friendly countries in the world, Latvia ranks 19th in the competition with 190 countries this year, leaving 171 economies behind.
In this year’s assessment, Latvia has managed to significantly improve its ranking in “Protecting Minority Investors”, where we have moved from the 51th place last year to the 45th place last year, as well as in “Enforcing Contracts”, where Latvia raised from the 20th place last year to the 15th place this year.
“The vision of the Ministry of Economics is to create an excellent business environment and to move towards an innovative economic model. The high assessment of the Latvian business environment by the World Bank shows that the government is aware of the need for reforms and is implementing them in a targeted way,” emphasises Ralfs Nemiro, the Minister of Economics.
In Latvia, the Doing Business rating is used as a tool for evaluating reforms, which allows to highlight the requirements where the administrative burden is too high, namely by comparing the number and duration of administrative procedures and associated costs, and to assess the business environment as a whole.
In order to promote Latvia’s position in international ratings, every two years the Ministry of Economics draws up an Action Plan for Improvement of the Business Environment, which is a government tool that includes specific tasks for improving the business environment, specifying precise deadlines for execution and responsible authorities. “The purpose of the Action Plan for Improvement of the Business Environment is to create accessible and understandable services and a lower administrative burden for businesses. During this period, we have paid special attention to promotion of innovation, human capital and protection of investor rights, which are important components of a developed business environment,” continues the minister.
A variety of international indicators have been developed to assess the business environment, among which the World Bank’s annual Doing Business Index is the most popular. The Doing Business survey serves not only as comparative evaluation among countries in certain business areas, but also is used to reflect global events in world markets. International indexes allow existing and emerging entrepreneurs to understand the business prospects in the country concerned and thus reflect the country’s competitiveness at global level, as well as shows the areas requiring public involvement to reduce bureaucratic and other business barriers.
In addition, two new positions “Employing Workers”, which assess the flexibility of the employment regulatory framework, and “Contracting with the Government”, which assesses procedures and time in public procurements, are included in this period, however, these positions are not included in the score for the business-friendly and country rankings.
As it is known, the World Bank’s Doing Business rating quantitatively measures and compares the regulatory conditions and procedures of 190 countries of the world, which apply to the life-cycle phases of medium-size and small enterprises using standardised scenarios. The rating evaluates formal procedures that encourage or restrict business activity in the largest city – the country’s business centre. Doing Business relies on respondents’ opinions. In Latvia, these are a total of 45 respondents from the non-governmental and public sector.
More detailed results of the assessment of the Latvian business environment in this year’s Doing Business rating can be viewed on the World Bank website.