Jerusalem Post article crows about Israel's "ingenuity" economy

'Start-up nation' becomes better place to do business

By RONEN SHNIDMAN
11/06/2010 19:03

Israel ranked 29 out of 188 economies surveyed by World Bank for having a business-friendly regulatory environment; third in ME.

Israel has gotten much press recently for being a "start-up nation" that prizes ingenuity and some entrepreneurial chutzpa, but that isn't all it has going for it as a player in the global economy according to a rankings report released by the World Bank earlier this week.

The international organization's "Doing Business" project on Thursday released its annual global ranking of 183 economies based on a business-friendly regulatory environment for 2011, ahead of the new year. According to the World Bank, Israel ranks 29th in the world in terms of regulatory and economic environment friendly towards small and medium-size businesses. Israel's ranking for the upcoming year represents an improvement of one spot over its 2010 ranking of 30.

The "Doing Business" project analyzes regulations that apply to an economy’s businesses during their life cycle, including start-up and operations, trading across borders, paying taxes, and closing a business. "Doing Business" emphasizes that its rankings do not measure all aspects of the business environment that matter to firms and investors, for example, security, macroeconomic stability, corruption, skill level, or the strength of financial systems.

In comparison to Israel's relatively impressive performance, regional neighbors Egypt, Jordan and Lebanon were all well-behind the pack with ranks of 94, 111 and 113, respectively. Moreover, despite Palestinian Authority prime minister and former International Monetary Fund official Salam Fayyad's attempts to build Palestinian institutions and stimulate the West Bank economy, the Palestinian territories ranked substantially behind all nearby Arab countries in terms of creating a friendly business environment ranking 135 in the world. Except that is, for Syria, which managed a shocking 144 out of 183 in the global rankings. The report stated that the PA did not help matters in 2010 by raising lawyers' fees for incorporating companies, although it has made progress in speeding up the process of customs approvals for imports and exports

Indeed an interesting observation that can be culled from the World Bank report is that the countries hastily seeking to align themselves with the Iranian mullahs have relatively disastrous relations with the business community, with or without sanctions. The Islamic regime itself ranked 131 among the 188 economies surveyed. It's main ally besides Syria (again, 144 out of 188), Venezuela, was really pulling up the global rear with a rank of 172. For purposes of comparison, Shi'ite dominated (and heavily Iran-influenced), recently war torn Iraq was still ahead of dictator Hugo Chavez's socialist paradise with a rank of 166.

Erstwhile Israeli ally and current Iranian partner in the region, Turkey was the one exception, with a rank of 65. But how long this will continue is in question as Ankara's economic policies helped drop Turkey five spots from its place at number 60 in just one year.