Georgia Ranks 4th Best Economy in Europe and Central Asia

Georgia Ranks 4th Best Economy in Europe and Central Asia

Georgia Ranks 4th Best Economy in Europe and Central Asia

The FINANCIAL -- Over 90 percent of economies in the Europe and Central Asia region implemented reforms to improve their business climate during the past year, finds the World Bank Group’s annual ease of doing business measurement.

Doing Business 2016: Measuring Regulatory Quality and Efficiency, released today, records 58 reforms implemented in 23 of the region’s 25 economies.

The reforms implemented in Europe and Central Asia accounted for 25 percent of the 231 reforms implemented worldwide during the past year. The region also boasted three of the world’s top 10 improvers, i.e. countries that implemented at least three reforms and moved up on the global rankings scale, with Cyprus, Kazakhstan, and Uzbekistan.  

“It is commendable that almost every single economy in Europe and Central Asia implemented at least one reform in the last year to improve the business environment,” said Rita Ramalho, Manager of the Doing Business project. “The political commitment and hard work involved in implementing these reforms has allowed the region’s economies to break into top performers on most of the indicators measured by the report.”

Georgia is ranked as the 4th best economy in Europe and Central Asia, with Macedonia being the region’s highest ranking economy, followed by Lithuania and Latvia. 

Globally, Georgia improved the most in the areas measured by Doing Business over the past 12 years. During this period output per capita in Georgia increased by 66% and business density more than tripled. Many factors contributed to this improvement in economic outcomes, and the effort to make it easier for local entrepreneurs to do business may have been one of them.

“Georgia remains a top performer on the ease of Doing Business,” said Eavan O’Halloran, World Bank Acting Regional Director for the South Caucasus.  “It is one of only 18 economies in the region that implemented two or more reforms over the past year – making enforcing contracts easier by introducing an electronic filing system for court users and making dealing with construction permits easier by reducing the time needed for issuing building permits. In this year’s report, there were significant changes in the scope and methodology that contribute to Georgia’s standing of 24 out of 189 economies. The main reason behind the drop with respect to last year’s published ranking is the new calculation of the ranking based on the methodology expansion.“

This year’s Doing Business report completes a two-year effort to expand benchmarks that measure the quality of regulation, as well as efficiency of the business regulatory framework, in order to better reflect the reality of business operations on the ground. On the five indicators that saw changes in this report – Dealing with Construction Permits, Getting Electricity, Enforcing Contracts, Registering Property and Trading Across Borders – Europe and Central Asia has performed well and this has positively impacted the global rankings of many of the region’s economies. 

The region stands out, globally, on the Registering Property indicator. The cost of registering property is the lowest globally – at an average of 2.6 percent of the property value. And, as in the high-income Organization for Economic Cooperation and Development (OECD) economies, it only takes 22 days to register property in the Europe and Central Asia region – the lowest time globally.

One of the biggest struggles for the region is the time it takes to get connected to the electrical grid. On average, this takes 119 days, compared to the average of 78 days in the OECD economies. But the region performs well on quality of electricity supply, with few outages and disruptions.