Romania moves up futher in World Bank’s Doing Business ranking, despite little progress in the past year

Romania ranks 37th out of 189 countries surveyed in World Bank’s recently published Doing Business 2016 report, up from 48th in last year’s ranking, and from 72th two years ago. At first sight, Romania has gained 11 places in this report compared to last year and no less than 35 places compared to 2013, but in reality much of this advance is due to a change in the methodology used by the World Bank to assess the ease of doing business. According to the World Bank’s comparable data, Romania has made little progress over the past year and its score only increased by 0.2 points (from 73.59 to 73.78). According to the new methodology used this year, Romania was already on 37th last year, a position which it kept but not improved. However, this is not to say that no progress has been made. Romania lowered the taxation level by reducing the rate for social security contributions and the rate for accident risk fund contributions paid by employers, made enforcing contracts easier by transferring some enforcement responsibilities from the court to the bailiff, and improved its insolvency system by introducing time limits for the observation period (during which a reorganization plan must be confirmed or a declaration of bankruptcy made) and for the implementation of the reorganization plan, according to World Bank. Much of Romania’s improved ranking comes from the ease of trading across borders, where all the European Union member states have got a perfect score of 100, as there is theoretically no obstacle in international trading in the EU. According to the previous methodology, Romania’s score was only 77 last year. Romania ranks 7th in the world for the ease of getting credit (the same as last year), but is only 133rd for the ease of getting electricity (up from 171st in 2014). Romania has also improved to some extent the ease of dealing with construction permits moving up from 140th to 105th on this chapter. Romania also moved up from 51nd to 34th for enforcing contracts, but went down on ease of starting a business (from 38th to 45th) and for protecting minority investors (from 40th to 57th). Singapore, New Zealand and Denmark top this year’s ranking of the countries where it’s easiest to do business. Estonia is the highest-ranked country in Eastern Europe, on 16th. Poland ranks 25th and the Czech Republic is 36th, just ahead of Romania. However, Romania ranks slightly better than Bulgaria, on 38th, and Hungary – 42nd. Romania is also ahead of Belgium, Italy, and Greece. The full Doing Business 2016 report can be found here. For comparison, the Doing Business 2015 is available here.