Why Has Barbados Left The World Behind? A Look At Doing Business 2010

As I comb through the reading material that the world's learned journals produce, I came across the latest World Bank report on Doing Business 2010 (see www.doingbusiness.org). I was not surprised to find Singapore in first place or that the Central African Republic was last (#183).

I eagerly thumbed through the document online searching for Caribbean countries, but first I wanted to see how high Barbados was relative to the others. Hello? Is anyone there? Barbados? Where are you? I could not find Barbados anywhere.

I found Barbuda (ranked #51, as always with Antigua). I found The Bahamas (#68). I found Jamaica (#75) and Trinidad (#81). Is the money being spent tempting people to come to invest in Barbados being done on a wing and a prayer? How is the world investing community supposed to know how Barbados stacks up against the rest of the world, or the Caribbean alone? I get it. They just come on a plane and soak up the business making environment. Why waste time on a survey. I hope someone at the World Bank or in one of the government's economic ministries has a good answer--a very good answer. I think back to the past week of PM Thompson glad handing in Florida and I wonder if the "Bajan" way is just more smoke and mirrors.

Puetro Rico (#35) and St. Lucia (#36) do best in the region. But nowhere could I locate God's isle. If you do not believe me, then look at the regional table for Latin America and the Caribbean (see table), which I also reproduce below.

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Latin America & Caribbean

[Clicking the headers below will sort data by column (try it and see).]

Economy	Ease of Doing Business Rank	Starting a Business	Dealing with Construction Permits	Employing Workers	Registering Property	Getting Credit	Protecting Investors	Paying Taxes	Trading Across Borders	Enforcing Contracts	Closing a Business
Puerto Rico	1	1	30	3	21	3	2	15	22	12	4
St. Lucia	2	4	4	2	10	18	5	2	20	27	8
Colombia	3	12	8	12	6	9	1	20	16	25	6
Chile	4	11	12	15	3	13	11	4	8	4	18
Antigua and Barbuda	5	8	6	10	15	27	5	21	6	5	10
Mexico	6	14	9	25	14	9	11	16	11	8	2
Peru	7	19	24	23	2	2	3	12	15	18	16
Bahamas, the	8	9	20	7	27	13	20	3	3	21	5
St. Vincent and the Grenadines	9	6	1	11	25	18	5	7	5	15	28
Jamaica	10	2	11	6	20	18	15	30	21	22	1
St. Kitts and Nevis	11	13	3	1	28	18	5	14	6	18	28
Panama	12	3	13	29	7	3	20	29	1	20	12
Belize	13	27	2	4	22	18	23	6	25	29	3
Trinidad and Tobago	14	10	15	8	32	3	3	5	4	30	28
Dominica	15	5	7	16	17	13	5	8	14	28	28
El Salvador	16	20	26	21	4	7	23	22	10	2	13
Dominican Republic	17	18	17	19	16	13	13	9	2	9	24
Grenada	18	7	5	9	29	18	5	11	13	26	28
Guyana	19	16	10	18	9	31	15	19	12	7	21
Guatemala	20	28	31	24	1	1	25	17	26	16	15
Uruguay	21	23	29	13	30	7	18	27	29	11	7
Nicaragua	22	15	28	17	26	18	18	28	17	3	11
Argentina	23	24	32	20	18	9	20	23	23	1	14
Costa Rica	24	22	27	22	5	9	28	26	9	23	17
Paraguay	25	17	22	30	11	13	13	18	31	17	20
Brazil	26	21	23	26	19	18	15	25	18	13	22
Ecuador	27	29	16	27	8	18	25	10	28	14	23
Honduras	28	26	14	28	12	3	28	24	24	31	19
Haiti	29	32	25	5	23	29	28	13	30	10	27
Suriname	30	31	19	14	31	29	32	1	19	32	25
Bolivia	31	30	21	32	24	27	25	31	27	24	9
Venezuela, R.B.	32	25	18	31	13	32	31	32	32	6	26

©2009 The World Bank Group, All Rights Reserved

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How utterly strange, I thought. With all of the IMF's recent commentary and concerns about the need to keep investor confidence high the last thing I expected was to find that Bim had gone AWOL in the eyes of potential business people. Is the country serious about moving ahead, not just out of the current recession?

The Economist does its usual nice job on summarising the latest report (see Reforming through the tough times). It shows that a lot of reforms have occurred since the last report. It's interesting that countries tend to emulate the 'leaders' in the region--more reason to see Barbados, showing what it means to be out in front.

• Encouragingly, reform seems to be contagious. Countries try to emulate leaders in their regions. Many African governments, for example, have taken note of the success of Mauritius’s deregulated economy (#17).

The Economist reports that reforms matter a lot:

• Lower barriers to entry are associated with a smaller informal sector. Informal businesses have lower wages, lower growth rates, poorer safety records, tend not to pay taxes and are prey to corruption. Reducing the cost of doing business leads to higher rates of growth and entrepreneurship.

• One study shows that, in poor countries, a ten-day reduction in the time it takes to start a business can lead to an increase of 0.4 percentage points in GDP growth. Another shows that people who have a formal title to their property invest as much as 47% more in their businesses.

• The best reformers have several things in common. Their reforms are part of a broad agenda of boosting competitiveness.

So, with all of these good things to come from reforming the business environment, why is Barbados apparently not in the race? I promise not to mention again my view about the perceived myth of Barbados' economic success, really I do.

A query to the World Bank in Washington DC, got the following explanation:

'The Doing Business report includes 183 economies. Since the launch of the first report in 2004, economies are added to the report based on their request. The Doing Business team has recently received a request from Barbados to be included in the report, and we expect that Barbados will be part of next year's report.'