Businesses in Bangladesh struggle most with public services: World Bank

The World Bank on Thursday (3 October) launched its new business and investment climate survey of 50 economies where Bangladesh has performed poorly in the effectiveness of public services such as electricity and tax administration.

The inaugural 2024 report "Business Ready (B-READY)" covers three key measures of a country's business climate – the quality of regulations, effectiveness of public services and operational efficiencies.

The global lender said, "Nearly all 50 economies assessed this year perform better on their regulatory framework than they do on the public services they provide to ease compliance by businesses. Such implementation gaps keep businesses, workers, and society as a whole from reaping the full benefits of a healthy business climate."

Among the three pillars, Bangladesh performed worst in public services, followed by the regulatory framework, while performing the best in operational efficiency.

Bangladesh scored 41.64 out of 100 in the public services pillar which spanned the facilities that governments provide to support compliance with regulations and the institutions and infrastructure that enable business activities. Estonia scored highest in public services, at 73.31 followed by Singapore, Croatia and Portugal.

In the regulatory framework, Bangladesh scored 56.99. The pillar assessed the rules and regulations that firms must follow as they open, operate, and close a business. Hungary had the highest regulatory framework score at 78.23, followed by Portugal, Georgia and the Slovak Republic.

However, Bangladesh performed better in the operational efficiency pillar, which captured the ease of compliance with the regulatory framework and the effective use of public services directly relevant to firms. It posted a score of 70.49.

Singapore, which often led the defunct Doing Business rankings, scored highest in operational efficiency at 87.33 followed by Georgia, Rwanda and Estonia.

B-READY focuses on ten topics that are organised following the life cycle of the firm and its participation in the market while opening, operating (or expanding), and closing (or reorganising) a business.

The main topics include business entry, business location, utility services, labour, financial services, international trade, taxation, dispute resolution, market competition, and business insolvency.

Bangladesh scored lowest in business insolvency, dispute resolution, and market competition. Within these areas, there are no digital services regarding liquidation and reorganisation proceedings, the economy lags in the organisational structure of courts, and lacks digitisation of intellectual property services.

Meanwhile, Bangladesh scored highest in business entry, business location, and labour. Within these areas, domestic firms do not encounter business-entry restrictions, domestic firms do not face restrictions on owning and leasing a property, and the economy implements good practices in terms of labour-dispute-resolution mechanisms.

Across all topics and pillars, B-READY analyses more than 1,200 indicators.

For the B-READY, the World Bank surveyed more than 2,500 experts and 29,000 firms across 50 economies, after scrapping the "Doing Business" rankings in 2021. Moreover, the coverage will increase over the next three years to reach about 180 economies in 2026, providing a full global benchmark. 

"Richer economies do tend to be more business-ready, but economies need not be rich to have a good business environment," said Norman Loayza, Director of the World Bank's Indicators Group.

He also said, "Our analysis finds that low- and middle-income economies can also achieve a strong business-enabling climate. Rwanda, Georgia, Colombia, Vietnam, and Nepal, for example, do well in various areas such as the quality of regulations, strength of public services, and overall efficiency of the system."