April 2021

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CENTRE FOR THE
STUDY OF LIVING
STANDARDS

The World Bank Doing BusinessIndex for Canada: An Assessment

Andrew Sharpe
April 1, 2021
CSLS Research Report 2021-02
Prepared for Office of the Chief Economist at Global
Affairs Canada

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The World Bank Doing Business Index for Canada: An Assessment
List of Tables ........................................................................................................................................................ 5
List of Charts......................................................................................................................................................... 6
List of Exhibits ......................................................................................................................................................6

Executive Summary ............................................................................................................................... 7
Introduction: Background and Motivation for the Report.............................................................. 11I.

The World Bank Doing Business Index: An Overview ....................................................... 12
A.

Motivation for the Doing Business Index ....................................................................................... 13

B.

Controversies about the DBI ........................................................................................................... 14

II.

Structure and Methodology of the World Bank Doing Business Index ............................. 14
A.

Structure of the DBI ........................................................................................................................ 14
1.

B.

III.

The DBI in a Federation .............................................................................................................16
Index Methodology ......................................................................................................................... 18

1.

Input aggregation and weights ................................................................................................... 18

2.

Questionnaires ............................................................................................................................ 19

A Snapshot of Canada’s Overall Performance on the DBI................................................. 20
A.

Ranking in 2020 ..............................................................................................................................20

B.

Trends in Canada’s DBI ranking..................................................................................................... 22C.

Comparison with Other International Indexes ................................................................................ 24IV.

A Deep Dive into Canada’s Performance on the Doing Business Index ............................ 26
A.

Overview of Pillar Developments ................................................................................................... 26
1.

Pillars in 2020 ............................................................................................................................ 27

2.

Changes in Pillar Rankings ........................................................................................................ 29

B.

Pillars with Average or Above Average Rankings and Limited Deterioration ............................... 30
1.

Starting a business ...................................................................................................................... 30

2.

Protecting minority investors .....................................................................................................31

3.

Resolving insolvency ................................................................................................................. 31

4.

Getting Credit ............................................................................................................................. 32

3
5.

Paying Taxes ..............................................................................................................................32

6.

Registering property ................................................................................................................... 32

C.

Trading across borders .................................................................................................................... 33
1.

Methodology .............................................................................................................................. 33

2.

Trends in the Indicators .............................................................................................................. 34

3.

Did Transport Costs Double between 2007 and 2009? .............................................................. 41

D.

Dealing with Construction Permits ................................................................................................. 42

E.

Enforcing Contracts ........................................................................................................................ 47

F.

Getting Electricity ........................................................................................................................... 50

G.

Explaining Canada’s DBI Performance .......................................................................................... 54
1.

Explaining Canada’s 23rd Ranking in 2020 ............................................................................... 55

2.

Explaining the Fall in Canada’s DBI Ranking ...........................................................................55

H.

V.

Concerns over the DBI Results for Canada .................................................................................... 57
1.

Data Issues ................................................................................................................................. 57

2.

Broader issues ............................................................................................................................ 58

Comparing the DBI with Other International Competitiveness and Economic
Environment Indexes.............................................................................................................. 59
A.

IMD World Competitiveness Index ................................................................................................ 60

B.

World Economic Forum Global Competitiveness Report............................................................... 62
1.

Comparing WEF and DBI rankings at the indicator level.......................................................... 64

2.

Transformation readiness performance ...................................................................................... 65

C.

The Fraser Institute Index of Economic Freedom ........................................................................... 67
1.

Comparing IEF and DBI indicators............................................................................................ 68

D.

The Cato Institute Human Freedom Index ...................................................................................... 70

E.

OECD Labour Market and Product Market Regulation Indicators ................................................. 72

F.

1.

Labour Market regulation indicators .......................................................................................... 72

2.

Product Market Regulation Indicators........................................................................................ 74
Concluding Remarks on Alternative Indexes.................................................................................. 78

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VI.An Assessment of the World Bank Doing Business Index .......................................................... 79A.

Composite Indexes in General ........................................................................................................ 79
1.

Strengths of Composite Indexes ................................................................................................. 80

2.

Weaknesses of Composite Indexes ............................................................................................ 80

B.

World Bank Evaluations of DBI ..................................................................................................... 81
1.

World Bank’s Independent Evaluation Group DBI Evaluation ................................................. 81

2.

Independent Panel of Experts DBI Evaluation ........................................................................... 83

3.

The Third World Bank Evaluation in Response to the Romer Controversy .............................. 85

4.
World Bank Group’s Internal Audit in response to the temporary suspension of the DB Reportin August 2020...................................................................................................................................... 86C.

D.

Critiques of the DB Report from the academic and NGO community ........................................... 89
1.

Methodological Concerns........................................................................................................... 89

2.

Critiques of the political impact of the DBI ............................................................................... 91

3.

Critiques of the Doing Business Index’s usefulness as an international benchmarking tool...... 92

4.

Critiques of the DBI as driver of international development ..................................................... 93
Assessment of the DBI Based on the Canadian Context................................................................. 95

VII.

Conclusion and Recommendations ....................................................................................... 97

VIII.

References for Doing Business Report ................................................................................ 100

Appendix 1: Doing Business Index by Country and by Pillar in 2020 ............................................................. 106
Appendix 2: List of Index Indicators in 2020 Index ......................................................................................... 114
Appendix 3: Ranking of Six Pillars of the Doing Business Index 2007-2020 .................................................. 115
Appendix 4: Canada’s Ranking on Six Pillars of the Doing Business Index and the Absolute Value andRanking of Pillar Indicators 2007-2020 ............................................................................................................ 119
Appendix 5: Scores for the Doing Business Index and its Pillars in Canada, 2015-2020 ................................. 126
Appendix 6: Ranking and Scores of Select Indicators, by pillar ....................................................................... 127

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List of Tables
Table 1: Overall and Pillar Rankings of Doing Business Index for Canada, 2007-2020 ............. 28
Table 2: Trading Across Borders Pillar ........................................................................................ 37
Table 3: Dealing with Construction Permits Pillar ....................................................................... 45
Table 4: Enforcing Contract Pillars .............................................................................................. 49
Table 5: Getting Electricity Pillar ................................................................................................ 53
Table 6: Comparison between Scores and Rankings for the DBI and Pillars for Canada, 2015
and 2020 ........................................................................................................................................ 58
Table 7: Canada’s Ranking for Competitiveness Indices 2007-2020 ........................................... 59
Table 8: Components of the IMD World Competitiveness Ranking, 2020. ................................. 61
Table 9: 2008 and 2019 Global Competitiveness Report World Economic Forum, Canadiancomparison for each subcomponent.............................................................................................. 63
Table 10: Canada’s Performance on Economic Transformation Priorities, by 2020 score .......... 66
Table 11: Fraser Institute Index of Economic Freedom Rankings for 2007 and 2020, Canada ... 68
Table 12: Fraser Institute Scores for Canada, 2007-2018............................................................. 70
Table 13: The Human Freedom Index for Canada, Scores over Time ......................................... 71
Table 14: The Human Freedom Index, for Canada, Scores for Economic Freedom Components,
2018............................................................................................................................................... 72
Table 15: OECD Employment Protection Legislation Indicators ................................................ 74
Table 16: Canada OECD Ranking for the OECD’s Economy-wide Product market Regulation
Index ............................................................................................................................................. 76
Table 17: Canada’s Ranking and Scores for the OECD’s Economy-wide Product Market
Regulation Index as compared with 36 other OECD countries, 2018 .......................................... 77
Table 18: Performance of G7 Countries on International Competitiveness Indexes 2020 or mostrecent year ..................................................................................................................................... 79

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List of Charts
Chart 1: Top 25 Countries Overall Performance on the Doing Business Index ........................... 21
Chart 2: Ranking of the G7 Countries on the Doing Business Index 2020 .................................. 22
Chart 3: Doing Business Index for Canada, Overall Index, 2006-2020 ....................................... 23
Chart 4: Canada’s Ranking in the Doing Business Index, 2007-2020 ......................................... 23
Chart 5: Canada’s Overall Ranking in Competitiveness and Economic Freedom Indices........... 25
Chart 6: Rankings for Doing Business Index and its Components for Canada, in 2007 and 2020....................................................................................................................................................... 27
Chart 7: Change in Rankings for the Pillars of the Doing Business Index for Canada between
2007 and 2020 ............................................................................................................................... 29
Chart 8: Rankings for the Trading across Borders Pillar, 2007-2020........................................... 34
Chart 9: Cost to Export and Import for Canada ............................................................................ 40
Chart 10: Dealing with Licenses (until 2009), Dealing with Construction Permits (since 2009) 42
Chart 11: Ranking for the Enforcing Contracts Pillar, 2007-2020 ............................................... 47
Chart 12: Ranking for the Getting Electricity Pillar 2012-2020 ................................................... 51

List of Exhibits
Exhibit 1: Pillars of the World Bank Doing Business Index ........................................................ 15
Exhibit 2: Pillars by Jurisdiction for the Doing Business Index for Canada ................................ 17
Exhibit 3: Summary of Index by Pillar, input type and weight .................................................... 18

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The World Bank Doing Business Index for Canada: An Assessment
Executive Summary
The World Bank Doing Business Index (DBI) attempts to measure the businessenvironment in ten areas or pillars for 190 countries. This flagship World Bank publication isboth very influential, leading to governments taking measures to improve their ranking, andcontroversial, as seen by the World Bank decision to suspend the DBI program in August 2020
for the investigation of data irregularities. The objective of this report is to provide a detailed
assessment of the DBI as it relates to Canada.
An assessment of the DBI for Canada is motivated by the fall in Canada’s ranking on the
DBI from 4th in 2007, the first year ranking were produced, to 23 rd out of 190 countries in 2020.
Should such a decline be considered evidence that Canada’s environment for doing business isworsening compared to other countries, or is the decline a statistical artifact related tomethodological issues and data problems, or is the fall caused by negative developments inindicators that have little overall importance for business? The report addresses these questions.
The DBI covers ten dimensions or pillars of the regulatory and business environment,
namely, starting a business, dealing with construction permits, getting electricity, registering
property, getting credit, protecting minority investors, paying taxes, trading across borders,
enforcing contracts, and resolving insolvency. Each year the World Bank administers detailed
questionnaires applicable to the country’s major city (Toronto in the case of Canada) on the 10
DBI pillars to business experts, mostly lawyers, in the 190 countries covered by the DBI. From
the responses, World Bank officials develop estimates for indicators related to business
operations and regulatory requirements (e.g., number of procedures, time, cost and quality). This
information is then transformed into scores and ranking for the pillars and the overall index.
Canada’s current ranking on the pillars and developments since 2007 are highlighted
below.
In terms of position in 2020, Canada ranked highest in starting a business (3rd), followedby protecting minority investors (7th), resolving insolvency (13th), getting credit (15th),and paying taxes (19th).



Canada ranked lowest in getting electricity (124th), followed by enforcing contracts(100th), dealing with construction permits (64th), and trading across borders (51st).

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

Between 2007 and 2020, Canada’s ranking declined in nine of the ten pillars. The
exception was paying taxes. The largest fall in ranking was in enforcing contracts (down84 places), followed by trading across borders (43 places) and dealing with construction
permits (32 places). The replacement of the employing workers pillar, in which Canada
ranked highly, by the poorly ranked getting electricity pillar also represented a major fallin ranking (111 places).

The deterioration in Canada’s DBI ranking between 2007 and 2020 took place in three
discrete jumps, each associated with particular development in one or more pillars. The
first jump in 2008-2009 was linked to the trading across borders and enforcing contracts
pillars, the second between 2011 and 2014 was due to the construction permits pillar andthe introduction of the getting electricity pillar, and the third in 2017 was related to theenforcing contracts pillar.

To explain the decline in Canada’s DBI ranking, the report conducts a deep dive on
developments in the four pillars that experienced the largest fall in ranking to identify the
specific indicator or indicators responsible for the fall. The key findings are highlighted below.
The fall in the ranking for the dealing with construction permits pillar was due to theincrease in the number of days needed to obtain a construction permit from 73 days in2012 to 249 days in 2014, driving Canada’s ranking for this indicator from 15 th to 160th.
.
The decline in the enforcing contract pillar was also due to the very large increase in time
for court cases, from 346 days in 2007 to 910 days in 2020, raising Canada’s ranking forthis indicator from 47th to 160th.



The fall in the ranking for the trading across borders pillar reflects an increase in trading
costs. The cost of exporting a container rose from US$700 in 2007 to US$1,660 in 2009,
with the ranking going from 40th to 130th. The cost of importing a container rose from
US$850 in 2007 to US$1,785 in 2009 with the ranking falling from 50 th to 122nd. No
explanation is provided for this massive increase on cost, which is inconsistent withoverall price developments. Even with the introduction of new cost indicators for the
trading across borders pillar in 2016, Canada’s ranking on costs remained very poor.

Canada has done poorly in the getting electricity pillar since it was introduced in 2012 to
replace the employing workers pillar where Canada ranked well. This change in pillars
reduced Canada’s overall DBI ranking. The poor performance in getting electricity is
explained by both the number of procedures (Canada ranked 169th in 2012 and 162 nd in2020) and the time needed (Canada ranked 156th and 171st).

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The report compares Canada’s DBI ranking with its rankings in two international
competitiveness indexes (the Global Competitiveness Index and the World CompetitivenessIndex) and in two indexes on the economic environment (The Economic Freedom Index and the
Human Freedom Index). For the most recent year for which estimates are available, Canada’s
DBI ranking is lower than that of all four other indexes. In addition, while Canada’s DBI ranking
has fallen since 2007, our ranking on the four other indexes has been relatively stable. There are
two possible explanations for this inconsistency. First, the indexes may be capturing different
phenomena, with the DBI confined to specific business practices and regulations. Support forthis hypothesis is provided by the OECD Product Market Regulation Index which in 2018 ranked
Canada 34th out of 36 countries. Second, data issues, including data errors and use of indicatorsthat have limited relevance for efficient operation of most businesses, may be providing a false
signal on trends in the ease of doing business in this country.
The DBI has come under criticism from persons both inside and outside the World Bank.
The report reviews the finding of four evaluations the World Bank commissioned on the DBI, as
well as critiques from NGOs in the development community. Weaknesses and limitations of the
DBI that have been pointed out include:

manipulation of DB rankings by World Bank staff for political purposes, as reported
in the December 2020 World Bank audit following the August 2020 DB suspension.

the limited number, poor quality, and narrow perspective of contributors;

inconsistencies in rankings over time due to methodological changes and introductionof new pillars or indicators;the omission from the DBI of key factors affecting the business environment such as
corruption and infrastructure;a failure to balance the benefits of business regulation with the costs;

inconsistencies between the DBI results and results from firm-level enterprisesurveys;a “one size fits all” approach that ignores the local context;

DBI-induced pressures on governments to game the index by making regulatorychanges that improve the country’s ranking and gain political points, but have only
superficial or limited effect on the ease of doing business and development;

10

insufficient attention in the DBI to consider equity implications arising from changes
in indicators; and

mixed success in identifying a close relationship running from improvements in DBI
pillars and indicators to sustainable and equitable development.

Overall, the benchmarking of Canadian performance related to the ease of doing business
relative to other countries is very informative. But some of the results appear strange and meritfurther investigation. The DBI results for Canada, at the national level, may not always bemeaningful.
Indeed, the suspension of the DBI by the World Bank because of data irregularities inAugust 2020 supports this cautious approach to the DBI. The full results of this investigation
should be awaited before a definite assessment is given on the validity and reliability of the DBI.
The initial audit results confirming data manipulation by World Bank staff because of politicalpressure are not encouraging.
Nevertheless, given the massive amount of information on the business environment that is
generated by the DBI, and the great value of this information, a case can be made that thecontinuation of the DBI in some form is desirable, at least from a knowledge perspective. It isbetter to have detailed information on doing business indicators for 190 countries, including
Canada, than to have no information, even if some of this information is not perfect.

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The World Bank Doing Business Index for Canada:
An Assessment1
Introduction: Background and Motivation for the Report
Policy-makers understand the importance of competitiveness to the well-being andprosperity of Canadians. Although much talked and written about, competitiveness does nothave a single and universally accepted definition. Various organizations and think-tanks produce
competitiveness studies and indices, one of which is the World Bank’s Ease of Doing BusinessIndex (DBI). In response to a request from Global Affairs Canada, the Centre for the Study of
Living Standards (CSLS) has conducted a deep dive into the World Bank Doing Business Index
for Canada.
The report examines the intent of the Index, the scientific soundness of data, themethodology, methodological changes over the time series of the index, and assesses the impact
of methodological changes on Canada’s ranking; It also discusses the quality of the index (e.g.
whether the DB index may lead to “false negative” conclusion or encourage a race to the bottom
to improve a country’s ranking); and review any other pertinent information available for Canada
and select countries ranked ahead of Canada (e.g. the United States, Australia and New Zealand)to assess the pertinence of this index for Canadian policy-making; Finally the report compares
the DBI index with other relevant indices (e.g. OECD’s Product Market Regulation (PMR)
Index, WEF’s Global Competitiveness Index, and IMD’s World Competitiveness Yearbook).
The five specific tasks for this report identified by Global Affairs Canada are the following: 1)
review data quality and methodology, including any changes, used by the World Bank for thisindex; 2) analyze Canada’s performance and compare it to that of other similar countries, and those
who have managed to surpass Canada, including a review of performance of the overall index,
pillars and indicators; 3) assess the pertinence of the overall index and sub-components to policymaking; 4) compare the DBI to other analogous measures produced by other organizations; and 5)
develop recommendations on the appropriate use of the DBI to inform policy-making (for example,
whether changes in overall ranking over time are meaningful, and what peer countries Canada
should be compared to).

1

This report was written by Andrew Sharpe, with contributions from Rachel Hammond and Gratiela-Catalina
Ciorica. The Centre for the Study of Living Standards would like to thank Global Affairs Canada for the invitation
to prepare this report. The author would like to thank Global Affairs officials, particularly Cristina Popovico andMelanie Raymond, Bert Waslamder and participants in the March 4 webinar on the report for comments

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The report is divided into seven major sections. The first section provides context for thereport by looking at the history of the World Bank’s Doing Business Index, referred to as the DBI
or the Index,2 including the motivation for the Index, the impact of the Index, the chronology ofdevelopments related to the Index and controversies associated with the Index. The second section
looks at the structure of the Index and the methodology. The third section provides a snapshot of
Canada’s overall performance on the Index. The fourth section, the longest, provides a detailed
examination of or “deep dive” on how Canada has performed on the Index since 2007 and thereasons for this performance. The fifth section compares the Index with six other international
indexes of competitiveness or economic performance. The sixth section provides a criticalassessment of the strengths and weaknesses of the DBI. The seventh and final section concludes
and provides recommendations for Global Affairs for the use of the DBI to inform policy-making.
An Appendix provides additional information on the DBI.

I.

The World Bank Doing Business Index: An Overview

The Doing Business Index (DBI) is a measure of the ease of operation of businesses in ajurisdiction. Many firms – from small to (especially) large – take the results and the rankings ofthe Index, and the general report that accompanies the Index, as a barometer of how businessfriendly a jurisdiction is. Indeed, some enterprises use the DBI results as a first filter when
examining where to open a representative office, regional headquarter or generally where to dobusiness.
The DBI is presented in the Doing Business Report (DBR or “Report”). It is a global
performance report and is a flagship publication of the World Bank. It is an annual report publishedby the Bank since 2003 (2004 edition of the Report) with the aim of measuring the business climateof each of its member states.3 In the most recent Report, 190 entities were assessed. The Report
was initiated by the Bank as a way to encourage economic development of its member states
through regulatory reforms.
The Report is released in the fourth quarter of each year as a guide for the businessenvironment in the coming year. The 2020 Report was made public in October 2019. The 2021
Report was to be launched at the end of October 2020 until the DBI was suspended in August of
last year.
The DBI provides useful insights into which parts of the public and private sectors are
efficient and which parts are lagging. The Index is especially relevant, though, for the public sector
given that it, in large part, measures the enabling environment of regulations. The Doing Business2

In the literature on the DBI, the acronym DBR or Doing Business Report is often used, This DRB is the report or
document that presents estimates of the DBI. Both DBI and DBR will be used in this report,
3
See Appendix 4 for a time series of Canada’s performance on the Index and its pillars.

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Report accompanies the Index and examines the details of the Index, how countries have
performed against each other and over time, and also particular theme(s) relevant to each year
(World Bank, 2019a). It is a global publication produced by a reputable institution (World Bank)and is widely known and used in the business community. It has had the support and input of
leading academics (e.g., Oliver Hart and Adrei Shleifer, both of Harvard University) and policy
makers over the years to arrive at its current form.
A.

Motivation for the Doing Business Index

Analysts of the economic development process focus on identifying the conditions thatfacilitate economic growth. The business environment is considered particularly important as, inmarket economies, economic growth is largely driven by the business sector. A favourable
business environment is often seen as a pre-condition for business investment. There are manydifferent aspects of the business environment and their relative importance can vary over time,
across countries, with the stage of economic development, and depend on the perspective of theanalyst.
The objective of the World Bank is to promote economic development in theunderdeveloped world to reduce poverty. To attain this objective, the World Bank provides
financial resources to developing countries and provides advice on what are the most effective
frameworks and policies to foster development. With its market orientation, the World Bank has
traditionally promoted the view that removing barriers to business is a means to foster economic
development. The fewer the barriers, that is the greater the ease of doing business, the greater,prospects for development, everything else being equal.
In the early 2000s, the World Bank attempted to identify the most important components
or areas of the business environment and specific indicators that captured or represented thesecomponents. The resulting information could then be aggregated into an aggregate or composite
index whereby countries could be assessed in both absolute and relative terms on their businessfriendliness. The result was the World Bank’s Doing Business Index, first published in 2003.
This World Bank project was allocated substantial internal resources and became theorganization’s largest research undertaking. The project also was very successful with the annual
Doing Business Report becoming one of the two World Bank flagship publications (the other isthe annual Word Development Report). The Report also became very influential in the developingworld, with countries making changes in their business regulations in response to the results fortheir country published in the Report to improve their ranking. These changes may have been realor cosmetic to game the indicator.

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B.

Controversies about the DBI

While certainly influential, the Doing Business Index has also been very controversial
throughout its history. Indeed, because of concerns about the validity of the DBI estimates, theWorld Bank, on August 27, 2020, suspended, for review, production of the 2021 Doing BusinessIndex. By early February 2021, no decision has been announced on the future of the DBI.
There have been two major controversies in the history of the DBI. First, in 2007, theInternational Labour Organization (ILO) and other labour groups objected to the labour market
component, which was considered anti-union. Second, in 2018, the World Bank Chief Economist(and Nobel laureate in economics) Paul Romer made the claim that the DBI data were manipulated
for political purposes in the case of Chile. In the first instance, the DBI made the decision to
exclude the labour input from the calculation of the overall DBI score, but still gathered
information on the measure. In the second case, Paul Romer ended up resigning from the WorldBank over the incident.
The DBI is certainly less influential in Canada than in developing countries dependent on
the World Bank for aid. But it is still important, as seen by the recent reference to the Index by theBusiness Council of Canada (BCC). In the Fall 2019 report of its Task Force on Canada’s
Economic Future, BCC indicated that a survey of its members had identified “the regulatoryburden as the single most important factor weighting on Canadian competitiveness” (BCC,
2019:6). The BCC report recommended that Canada commit to the goal of being the mostefficiently regulated country on earth, as measured by the DBI. In a federation, businessregulations can vary by province and the DBI for Canada is based on information for Toronto, thus
only capturing the business regulation framework in Ontario. The BCC recognized this limitationof the DBI for Canada. The BCC considered developing estimates of the DBI by province, but it
appears that this project has not gone ahead.

II.

Structure and Methodology of the World Bank Doing Business Index
A.

Structure of the DBI

The DBI aims to measure the costs to firms of business regulations. It is a theoretical
exercise in that it examines the business regulations that pertain to a hypothetical firm (of a certain
structure in a particular situation) that conducts business in the nation’s business capital. In
Canada, the city used in the DBI is Toronto. For some large countries more than one city may be
used to ascertain the cost of doing business. For example, in the United States the cities are New
York and Los Angeles. In such cases, the results for the cities are combined into one representativescore for the country.

15
To assess the ease of doing business the hypothetical company is examined to see how
onerous it is to execute various business activities, such as getting electricity or resolving
insolvency. Ten of these general hypothetical situations are the pillars of the Index:
Exhibit 1: Pillars of the World Bank Doing Business Index
EDB
Index

Starting abusiness

Dealing withconstruction
permitGetting
electricity

Registering
property

Getting
creditProtecting
minorioty
investors

Paying taxes

Tradingacrossborders

Enforcing
contracts

Resolving
insolvency

1. Starting a business
2. Dealing with construction permits
3. Getting electricity
4. Registering property
5. Getting credit
6. Protecting minority investors
7. Paying taxes
8. Trading across borders
9. Enforcing contracts
10. Resolving insolvency
The index value takes on values in the range 0 (worst) to 100 (best). The value is interpreted
as a “distance to frontier” measurement, meaning it expresses how close a country is to the leader.
The top five global leaders in 2020 were (from first to fifth): New Zealand, Singapore, Hong Kong,
Denmark, and Korea. Canada places 23rd overall on the Index, placing as high as 3rd for theStarting a Business pillar and as low as 124th for the Getting Electricity pillar. The United States
ranks 8th overall. (See Appendix 1 for a list of rankings for all 190 member states.)
The DBI can also be applied at a sub-national level (i.e., for regions/cities in a country).
This application is not unusual. In fact, the World Bank has produced sub-national reports for 71
countries (including OECD countries) covering hundreds of regions, 4 including one for New YorkState. Sub-national reports are effective means to understand the business climate in particularregions or cities within a country. However, no sub-national report has ever been produced for
Canada. Producing a sub-national report can be an extensive exercise for the World Bank. It
requires not only significant resources from the Bank, but also a dedicated local team collaboratingon the project.
4

See: https://www.doingbusiness.org/en/reports/subnational-reports

16

1.

The DBI in a Federation

Canada is a federation. Jurisdictional authority in many fields lies not with the central or
national government, but with the sub-national levels of government. This has implications for the
DBI for Canada, which is based on questionnaires administered in Toronto. For pillars underprovincial regulation, the results for Canada based on Ontario legislation may not be accurate forother provinces. The same point applies to pillars under municipal jurisdiction, which will reflect
the regulations for the City of Toronto.
Exhibit 2 shows which of the three levels of government in Canada (federal, provincial andmunicipal) has sole authority, or shared authority, for the ten DBI pillars. The federal government
has sole authority for only one pillar (trading across borders), the provincial government two pillars(protecting minority investors and enforcing contracts), and municipal governments one pillar(construction permits).
There is shared jurisdiction between the federal government and the provincial government
in four pillars (starting a business, getting credit, paying taxes, and resolving insolvency). There isshared jurisdiction between the provincial and municipal governments in two pillars (getting
electricity and registering property).
The CSLS calculated an average ranking by jurisdiction. They found that the average rankfor pillars under federal jurisdiction is 20, outperforming both the provincial government (40), andthe municipal government (75). The federal government performs better on the three pillars undershared jurisdiction (getting credit, paying taxes and starting a business) than the trading acrossborders pillar.

17
Exhibit 2: Pillars by Jurisdiction for the Doing Business Index for Canada
Panel A: Jurisdiction by Pillar
2020 Rank
FederalProvincial
Starting a business
Dealing withconstruction permits
Getting electricity
Registering property
Getting credit
Protecting minority
investors
Paying taxes
Trading across borders
Enforcing contracts
Resolving insolvency

3
64
124
36
15
7
19
51
100
13

X

10

X
X

X

X
X
X

X
X

X
X
X
X

Panel B: Number of Pillars by Jurisdiction
Total
Number ofFederalPillars
Sole Jurisdiction
5
1
Joint Jurisdiction
5
4
Total Components underJurisdiction

Municipal

5

X
X
X

Provincial

Municipal

2
6

1
2

8

3

Panel C: Average Rank of Pillars Under Sole and Joint Jurisdiction and Overall, by Jurisdiction
Total
Average
FederalProvincial
Municipal
Rank
Sole Jurisdiction
47
51
53
64
Joint Jurisdiction
33
12
35
80
Total Components underJurisdiction

43

20

Source: CSLS Calculations based on DBI rankings in WB publication.

40

75

18
B.

Index Methodology

1.

Input aggregation and weights

Exhibit 3: Summary of Index by Pillar, input type and weight=A+B#

PILLAR

1
2
3
4
5
6
7
8
9
10

Starting a business
Dealing with construction permits
Getting electricity
Registering property
Getting credit
Protecting minority investors
Paying taxes
Trading across borders
Enforcing contracts
Resolving insolvency
COUNT
WEIGHTAB
DATACOMPOSITEWEIGHT INDICATORSINDICATORS INDICATORS
10%
7
7
0
10%
4
3
1
10%
4
3
1
10%
4
3
1
10%
2
0
2
10%
6
0
6
10%
4
3
1
10%
8
8
0
10%
3
2
1
10%
2
1
1
10
44
30
14
100%
100%
61.7%
38.3%

C

=A+C

COMPONENTSELEMENTS

0
11
6
27
15
44
6
0
17
18
144
38.3%

7
14
9
30
15
44
9
8
19
19
174
100%

The Index is comprised of 10 pillars which are further divided into 44 indicators. (SeeAppendix 2 for a list of all the indicators.) These indicators can be either data indicators (30) orcomposite indicators (14). Composite indicators can be further broken down into their underlying
components (144). The total number of elements (the smallest unit of division for the indicators)
is thus 174 (144 + 30).
The methodology in place for the 2020 Report has been in force since the 2015 Report.
The report has undergone several significant changes in methodology since its inception. In fact,
the DB Report only began ranking countries in 2006 and initially only provided a ranking for an
overall ease of doing business. In 2007, the Bank subsequently also started ranking countries oneach of the pillars that comprise the Index. The ten pillars in use today began with the 2012 Report,
and the use of the distance to frontier (a.k.a. ease of doing business score) was first implemented
for the 2015 report. (See Appendix 3 for Canada’s ranking performance on the Index and its pillars
since 2007).
The DBI score is a simple average of the scores of its ten pillars. Thus, each pillar accounts
for 10% of the final score of the Index. Underlying each of the pillars is a set of indicators whose
weights are equally distributed across the number of indicators in their respective pillar. The scoresof the various indicators are aggregated by converting them all first to a score ranging from 0 to
100 using a “distance to frontier” transformation, also called the “ease of doing business score”:
d(x) = 100*[worst – x]/ [worst – best]

19
In the equation above, x is the score of an indicator for a given jurisdiction. The variableworst is the worst value taken on in the sample of countries (usually this is fixed and reset every
few years or so) for the indicator, and best is the best value taken on in the sample of countries. 5
Since these variables are typically time, cost or procedures to execute a business transaction thelower the value the better. For example, if the number of procedures to start a business is 8, thenumber in the worst performing country is 21 and the number in the best performing country is 2
days, then the ease of doing business score for the starting a business indicator is 100*[21 – 8]/[21 – 2] = 68.4.
Composite indicators are comprised of smaller elements, which are called components.
The raw composite indicator score (i.e., before it is transformed into an ease of doing businessscore) is the sum of all its underlying component scores which are non-negative integer values.
The component data are discrete variables that take on a positive integer value when a particularbusiness condition is true and otherwise take a zero value. 6
Once the indicators have been transformed to a form d(x) they are then aggregated at thepillar level. Then the pillar scores are aggregated at the index level to arrive at the DBI Index score.
Since all the indicators are converted to a score between 0 and 100, the pillar scores are also
between 0 and 100, and likewise the Index score since they are just weighted averages of theindicator scores. A score of 100 represents being at the frontier; a score of 0 represents being thefarthest from the frontier (laggard). Countries are then ranked on their Index score to arrive at the
DBI rank. In addition, countries are ranked for each of the underlying pillar and indicator scores. 7
2.

Questionnaires

Although the inputs into the Index are objective rather than subjective measures, most of
the inputs are based on expert opinion/knowledge surveys. This is because the inputs are generally
measures of time, cost and procedures to do a business transaction for a hypothetical company
operating in the business capital (or possibly in several cities) of a country. As such they require
expert legal, accounting and other knowledge to ascertain these values. For example, thisknowledge base might include information on whether parties who construct a structure are legally
5

To deal with outliers sometimes the best and worst scores are truncated.
For example, a component variable may be whether or not insurance is (legally) mandatory or not for a given
transaction (with a score of 1 when it is the case and 0 otherwise).
7
Although the DBI Index score is scaled to 100, doing time series comparisons can be tricky as there may bedifferent published/official Index scores for a country. This is because the World Bank publishes a hard copy of theIndex but it also maintains a live (real-time) score in which the value of underlying indicators may have changed
since the Index was initially published in hard copy format. This may also affect the worst and best values of an
indicator, so that even if there are no changes to a given country’s indicators, its score (and rank) may change if the“goalposts” have changed, or if other countries’ scores have changed. Sometimes there are also modifications to theIndex methodology which may result in real-time results differing from results published in hard copy (or retrieved
from Internet sources that have not been refreshed/updated).
6

20
liable for structural flaws. The World Bank administers 10 questionnaires for the report, 8 one foreach of the pillars. Often it requires more than one expert to adequately answer the questionnaire.
Time required to answer the survey can be substantial if it requires the expert to do research orother actions to generally track down the answer.
For the Canada DBI report, 53 experts, mostly lawyers were consulted by the World Bank. 9
The vast majority of these individuals are based in Toronto.

III.

A Snapshot of Canada’s Overall Performance on the DBIThis section provides a snapshot of Canada’s aggregate performance on the DBI from three
angles. First, it looks at how Canada performed on the DBI in the 2020 publication of the Index(data for 2019) and compares Canada’s performance with that of other countries. Second, it looks
at how Canada’s DBI ranking has evolved over the 2007-2020 period. Third, it compares Canada’s
performance on the DBI to that of other international competitiveness and economic environment
indexes, both for the latest year and for trends over time.
A.

Ranking in 2020

In 2020 Canada ranked 23rd out of 190 economies on the DBI. Chart 1 shows the top 25
countries in the DBI rankings in 2020. Appendix 1 provides the ranking for all 190 countries
covered by the DBI. The top performing countries on the DBI in 2020 were New Zealand, followedby Singapore, Hong Kong, Denmark, and South Korea. The United States ranked sixth.

89An additional questionnaire related to Employing Workers is no longer used for the Index.
See : https://www.doingbusiness.org/en/contributors/doing-business/canada

21
Chart 1: Top 25 Countries Overall Performance on the Doing Business Index

Canada’s 23rd place may appear a not particularly impressive ranking for a rich, wellgoverned country. Four observations outlined below place Canada’s 23rd DBI ranking in context.
First, among G-7 countries (Chart 2) Canada ranks fourth behind the United States (6th),
the UK (8th), and Germany (22nd), and ahead of Japan (29th) France (32nd), and Italy (58).
Canada’s score is highly comparable to Germany’s who ranks just one place ahead.

22
Chart 2: Ranking of the G7 Countries on the Doing Business Index 2020
0

6

8

10
22

Ranking

20

23
29

30

32

40
50
58
60
United States

UnitedKingdom

Germany

CanadaJapan

FranceItalysource: https://www.doingbusiness.org/en/rankings

Second, several non-G-7 OECD countries that generally do well on international
competitiveness indexes do poorly on the DBI, including Switzerland (36th), the Netherlands(42nd), Belgium (46th), and Luxembourg (72nd). This suggests that an index designed to capture
the ease of doing business is not the same as one that measures a country’s ability to competeinternationally.
Third, a number of small, middle income countries not normally considered international
leaders do remarkably well (in the top 20th) on the DBI, possibly because of their decisions to
implement policies to directly target components of the DBI and foster competitiveness. These
countries include Georgia (7th), Malaysia (12th), Mauritius (13th), North Macedonia (17th),
United Arab Emirates (16th). It is also noteworthy that the UAE was involved in the data
manipulation scandal story that broke in 2020.
Fourth, certain countries that are not historically known as business-friendly economies doquite well in the DBI. For example, Russia ranks 28th and China 31st.
B.

Trends in Canada’s DBI ranking

Canada’s ranking in the Doing Business Index (DBI) fell 19 places from 4th to 23rd placein the 13 years between 2007 and 2020 (Chart 3). This deterioration has taken place in stages(Chart 4). In 2008, the ranking fell to 7th place and then stabilized for the next three years. Between
2011 and 2013 the ranking fell from 7th to 17th. It then remained more or less stable for the next
three years, before decreasing to 22nd in 2017, and has remained around this level for the threesubsequent years.

23

Chart 3: Doing Business Index for Canada, Overall Index, 2006-2020
0
4

4

5

7

8

8

7

Ranking

10

13

14

15

16

17

18

19
20

22

22

23

25
2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Year
Source: https://www.doingbusiness.org/en/reports/global-reports/doing-business-2020

Chart 4: Canada’s Ranking in the Doing Business Index, 2007-2020
0

Ranking5

2008- 2011 average

1015

2012-2016 average
20

2017-2020 average
25
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Year
rank

2008- 2011 average

2012-2016 average

2017-2020 average

Source: https://www.doingbusiness.org/en/reports/global-reports/doing-business-2020

In other words, there have been three downward shifts in the path of the DBI ranking for
Canada over the 2007-2020 period, downward shifts in 2008, 2012 and 2013, and 2017. This reportwill examine what was been behind each of these developments.

24
The downward trend in Canada’s overall DBI ranking reflects three factors. The first is thechange in Canada’s ranking in specific pillars. This can be driven by changes in the values of theindicators that make up a pillar in Canada or by changes in the values of the indicators in othercountries which change the ranking of those countries with respect to Canada, with no change inthe values of indicators and the pillar in Canada.
Second, change in ranking can arise when a pillar’s name is changed, either to capture thesame general topic in a slightly different manner or when a pillar is replaced by another pillar on
a completely differ topic. The ranking for the revised or new pillar may differ substantially fromthe ones they replace, resulting in major changes in overall ranking. Three of the original 10 pillars
have been altered since 2007, with dealing with licences becoming dealing with construction
permits, protecting investors becoming protecting minority investors and closing a businessbecoming resolving insolvency. One pillar was entirely replaced, with employing workers
becoming getting electricity.
Third, change in ranking for a pillar may reflect changes in indicators used for the pillar,even though the name of the pillar remained unchanged. This has happened in the trading acrossborders pillar in 2016.
The analysis will proceed in three steps. First, the ranking of the pillars in 2020 will be
discussed. Second, the trends in the six original pillars will be examined and the contributions ofany deterioration in these pillars to the overall deterioration identified. Third, the introduction of
the four replacement pillars will be examined, both in terms of the impact of the replacement on
the overall ranking and trend in the pillar ranking since this introduction.
The report will identify which pillars have been responsible for the downward trend or fallin the Canada’s DBI ranking and then undertake a deep dive to explain what is driving thedownward trends in each pillar.
C.

Comparison with Other International Indexes

Canada’s 23rd ranking in the DBI in 2020 compared unfavourably with that of thecountry’s ranking in four prominent competitiveness or economic environment indexes, as shownin Chart 5. For the most recent year for which data are currently available, Canada ranked 6th in
the Human Freedom Index, 8th in the IMD Competitiveness index, 9th in the Index of Economic
Freedom and 14th in the WEF Global Competitiveness Index.
In contrast to the fall in Canada’s DBI ranking over the 2007-2020 period, Canada’s
ranking in the other four indexes has remained stable.

25
Chart 5: Canada’s Overall Ranking in Competitiveness and Economic Freedom Indices
1
3
5
7
9

Ranking

11
13
15
17
19
21
23
25
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

IMD World Competitiveness Ranking (63 countries)
Global Competitiveness Report World Economic Forum (137 countries)
Cato Institute Human Freedom Index (141 countries)
Fraser Institute index of Economic Freedom (186 countries)
World Bank Ease of Doing Business Index (190 countries)

Source: Compiled by the CSLS based on rankings presented in Table 8

This divergence between the DBI and the four other indexes needs to be explained. There
are three possibilities. First, the stability of Canada’s international competitiveness as captured by
the four indexes is accurate and the deterioration reported by the DBI is inaccurate, reflecting data
problems. Second, the stability of Canada’s international competitiveness as captured by the fourindexes is accurate and the deterioration reported by the DBI is also accurate for the pillars andindicators chosen, but these measures are not particularly important for competitiveness and forthat reason not covered in the other four indexes. Third, the stability of Canada’s international
competitiveness as captured by the four indexes is inaccurate and the deterioration reported by the
DBI is accurate. Given that four indexes point to stability in Canada’s international
competitiveness and only one to a deterioration, the likelihood of this third explanation is low. The
report will later present the four indexes and discuss reasons for the divergence noted above.

26

IV.

A Deep Dive into Canada’s Performance on the Doing Business Index

This section of the report provides a detailed examination of or deep dive into the ten DBI
pillars for Canada over the 2007-2020 period. The objective is to shed light on the reasons for
Canada’s 23rd ranking in 2020 and for the deterioration in the ranking from 4th in 2007. The pillars
with the worst rankings in 2020 and the largest deterioration in ranking are key to the story andwill receive the most attention.
This section is divided into seven sub-sections. The first provides an overview of the
ranking of the pillars in 2020 and their trend over time. The second section examines briefly thesix pillars that have an above average ranking and have not experienced a major deterioration in
their ranking. The next four sub-sections look separately at the four specific pillars in which
Canada ranked poorly in 2020. The final sub-section summarizes the findings.
A.

Overview of Pillar Developments

Table 1 provides the annual time series of the rankings for Canada for the overall DBI and
its ten pillars from 2007 to 2020.10 Two observations can be made. First, while there are 10 pillars
in every year, four of the original pillars were replaced over time, 11 with important implications
for the consistency of the rankings and hence the meaningfulness of the trends. Second, the numberof countries or economies covered by the ranking has increased slightly over time, from 175 in2007 to 190 in 2020. However, this development has no effect on the absolute rankings for Canada
as the countries added, all developing countries, are in the bottom half of the rankings.
Appendix 5 provides the annual time series of the scores and rankings for Canada for the overall
DBI and its ten pillars from 2015 to 2020, the only period when the DBI is consistent over time as
there were no changes in pillars during this period. Appendix 3 provides bar charts of

10

The DBI can be expressed in absolute and relative terms. The absolute score is based on the distance function for
the indicators discussed in the previous section. Unfortunately, both the indicators and the methodology for theirconstruction must be constant for the scores to be consistent and hence meaningful over time. For the DBI this has
only been the case since 2015 (See Appendix 5). A ranking can be calculated from the country scores for indicators
based on any methodology and it captures that country’s performance for that index based on the current set ofindicators and their methodology. It that sense it is a meaningful number. The time series of ranking however may
be less meaningful because of changes in the indicators and their definitions. It is important to track rankings sincethese rankings garners much attention and to determine whether rankings is consistent over time and hence
meaningful.
11
The dealing with licences pillar was replaced by the dealing with construction permits pillar in 2009. The
employing workers pillar was dropped in 2010 and replaced in 2012 by the getting electricity pillar. The closing abusiness pilar was replaced by the resolving insolvency in 2012.The protecting investors pillar was replaced by theprotecting minority investors pillar in 2015.

27
developments by year in all pillars from 2007 to 2020. Because of replacements, there were 14
different pillars over the period, with six pillars unchanged for all 14 years.
1.

Pillars in 2020

Chart 6 gives the ranking and the scores for the overall DBI and the ten pillars for Canada
in 2007 and 2020. Canada best performance in 2020 was in starting a business where the country
ranked third. Canada also did well in protecting minority investors (7th), resolving insolvency(13th), getting credit (15th) and paying taxes (19th). The ranking for the other five pillars were
worse than the overall 23rd ranking.
Canada’s worst performance for the pillars was for getting electricity, where it placed
124th. This was followed by enforcing contracts at 100th, dealing with construction permits (64th),
trading across borders (51st), and registering property (36th). The reasons for Canada’s poor
ranking on these pillars, particularly the four worst, need to be identified to explain Canada’s
overall ranking among developed countries.
Chart 6: Rankings for Doing Business Index and its Components for Canada, in 2007 and 2020
Starting a business1

protecting Investors/Protecting Minority Investors

5
7

Closing a business/Resolving Insolvency

5

Getting Credit

7

3

13
15
22
19

Paying Taxes
Overall ranking

4

23
22

Registering Property
Trading across Borders

36

8

51

Dealing with licenses/Dealing with Construction
Permits

32

Enforcing Contracts

16

Employing workers/Getting electricity

13

0
20
40
2007 Ranking
2020 Ranking

64
100
124

60

80

100

Source: https://www.doingbusiness.org/content/dam/doingBusiness/media/Annual-Reports/English/DB07FullReport.pdf (2007), https://www.doingbusiness.org/content/dam/doingBusiness/country/c/canada/CAN.pdf(2020).

120

28
Table 1: Overall and Pillar Rankings of Doing Business Index for Canada, 2007-2020
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

19
2

16
2

14
3

22
2

18
2

22
3

23
3

118

53

57

54

63

64

Ranking
Overall
Starting a Business
Dealing with licenses
DealingwithConstruction
Permits
Employing workers
Getting
electricity
Registering Property
Getting Credit
Protecting investors
Protecting
Minority
Investors
Paying Taxes
Trading across Borders
Enforcing Contracts
Closing a businessResolving
Insolvency

4
1
32

7
2
26
N/A

13

19

8
2

8
2

7
3

28
7
5

17
3

N/A
29

29

18

17

29

32
28
5

25

69

116

N/A

N/A
22
7
5

13
3

35
30
5

37
32
5

156

152

145

150

105

108

105

121

124

41
24
5

54
23
4

55
28
4

55
7

42
7

43
7

33
12

34
12

36
15

N/A
22
8
16
5

25
39
43
4

28
44
58
4
N/A

28
38
58
4

10
41
58
3

N/A
7

6

7

8

11

7

9
44
49

17
46
112

16
46
114

19
50
96

19
51
100

15

11

13

13

8
42
59

8
44
62

8
45
58

9
23
65

3

4

9

6

N/A

16

175
178
181
185
183 economies
189 economies
190 economies
economies
economies
economies
economies
Source: https://www.doingbusiness.org/en/reports/global-reports/doing-business-2020
Note 1: “Dealing with licenses” was replaced in 2009 by “Dealing with construction permits”.
Note 2: There weren’t available data for “Employing workers” in 2011 and in 2012 another indicator was introduced “Getting electricity”. “Closing a business” was replaced in 2012 by “Resolving
insolvency”.
Note 3: “Protecting investors” was replaced in 2015 by “Protecting minority investors”
Nbr. of Economies

29

Employing workers/Getting
electricity

Enforcing Contrcats

Trading across Borders-8

Dealing with Licenses/Dealing with
Construction Permits-8

Registering Property-2

Getting Credit

Starting a Business-2

Closing a business/Resolving
Insolvency

Protecting investors/Protecting
Minority Investors

20

Pating Taxes

Difference in Rank between 2007 and 2020

Chart 7: Change in Rankings for the Pillars of the Doing Business Index for Canada between
2007 and 2020

3

0
-20
-40

-14
-32
-43

-60
-80

-84

-100

-111

-120

Source:https://www.doingbusiness.org/content/dam/doingBusiness/media/Annual-Reports/English/DB07FullReport.pdf(2007),https://www.doingbusiness.org/content/dam/doingBusiness/country/c/canada/CAN.pdf (2020).

2.

Changes in Pillar Rankings

Before examining changes in the rankings of the pillars between 2007 and 2020, it should
be noted that the names of three of the original ten pillars were altered, although the issue addressed
remained largely the same. These pillars were dealing with licences, which was replaced by dealing
with construction permits in 2009, protecting investors, which was replaced by protecting minority
investors in 2015, and closing a business which was replaced by resolving insolvency in 2012. In
all three cases the ranking of the newly named pillar in the first year was almost identical to theranking of the pillar before the name change. In other words, the changes in the names in thesepillars appears to have had no effect in rankings of the pillars.
Additionally, one pillar was dropped and replaced by a completely different pillar.
Employing workers was dropped as a DBI pillar in 2010. It was replaced in 2012 with the new,completely unrelated pillar getting electricity. In 2010, Canada ranked 17th for employing

30
workers. When the getting electricity, pillar was introduced in 2012, Canada ranked 155th. This
move to a pillar in which Canada ranked much lower had a negative impact on Canada’s overall
DBI rank. This impact will be discussed further later in the report.
Given Canada’s overall fourth place DBI ranking in 2007, it is not surprising that for mostpillars Canada’s ranking was much better than in 2020. Starting a business performed best, with
Canada in first place. The second-best performance (5th) was achieved by closing a business andprotecting investors. Next came getting credit (7th) followed by trading across borders (8th),
employing workers (13th), enforcing contracts (16th), and registering property and paying taxes,
ranked 22nd. In last place, with a 32nd ranking, was dealing with licenses. In 2020, five of the ten
pillars had lower rankings than the lowest ranked pillar in 2007.
Nine of the 10 pillars saw a deterioration in their ranking between 2007 and 2020 (Chart 7).
The exception was paying taxes where Canada improved from 22nd to 19th place. The largest
deterioration in ranking was for the employing workers/getting electricity pillar, dropping 111
places from 13th to 124th. This was followed by the enforcing contracts pillar, down 84 placesfrom 16th to 100th and the trading across borders pillar, down 43 places from 8th to 51st. The
dealing with construction permits pillar also dropped considerably, down 32 places from 32nd to
64th. The five other pillars all had much smaller deteriorations in their ranking, all with drops ofless than 15 placements in the rankings.
In other words, four pillars can be identified as largely responsible for pulling down Canada’s
DBI ranking: trading across borders, getting electricity, dealing with construction permits andenforcing contracts. To understand the overall DBI deterioration one must explain developments
for these four pillars.
B.

Pillars with Average or Above Average Rankings and Limited Deterioration

Before the deep dive on the four indicators that are largely behind Canada’s current DBI
ranking and the deterioration in these rankings since 2007, this sub-section briefly discusses thestate of the other six DBI pillars. This provides insight into where Canada performs well. The
discussion is ordered by the ranking, starting with the highest ranked pillar. This ordering principle
is also used for the four pillars with the worse rankings.
1.

Starting a business

Canada’s highest ranked pillar is starting a business. In 2020, Canada ranked third out of
190 countries on this pillar, down slightly from first in 2007. Canada placed no worse than thirdin any year over the 2007-2020 period. Canada has performed consistently well over time on all
four indicators in this pillar (Appendix 4, Panel A). The number of procedures required to start a

31business in 2020 was only two, the same as in 2007. The number of days needed to start a business
was 1.5 days, down from 3 days in 2007.The cost of starting a business was only 0.3 per cent ofincome per capita, down from 0.9 per cent in 2007. The minimum capital needed to start a business
was zero, unchanged from 2007.
Canada has improved its absolute performance on two of the four starting businessindicators between 2007 and 2020 and remained unchanged in the other two indicators. The verysmall slippage in relative terms, as indicated by the move from first to third place, reflects the evenbetter performance of the top two countries in 2020 (New Zealand and Georgia). The bottom lineis that Canada is an excellent location for the ease of starting a business.
2.

Protecting minority investors

Canada consistently performs well in the protecting investors pillar (called the protecting
minority investors after 2015). In 2020, Canada ranked 7th, down slightly from 5th in 2007. In
terms of the six indicators for this pillar, Canada scored particularly high on the extent of director
liability index (9 out of 10), the ease of shareholder suits index (9 out of 10), the extent ofownership and control index (6 out of 7), and the extent of corporate transparency index (6 out of
7). Canada did slightly less well on the extent of disclosures index (8 out of 10) and the extent ofshareholders rights index (6 out of 7). From the perspective of protection of minority investors,
Canada is an attractive place to do business.
3.

Resolving insolvency

Canada does fairly well in the resolving insolvency pillar (called closing a business before
2015 when it had two fewer indicators). In 2020, Canada ranked 15th, up from 5th in 2007. The
pillar has five indicators. It took 0.8 years to resolve an insolvency in 2020 and this time duration
has remained unchanged since 2007. The cost of resolving insolvency is 7 per cent of the value ofthe estate, up from 4 per cent in 2007. The recovery rate is 86.7 cents on the dollar, down slightly
from 89.3 cents in 2007. The strength of the insolvency framework index is 11.0 (on a scale from
1 to 16), down from 13.5 in 2015, the first year this indicator was part of the pillar. The fifth
indicator, also introduced in 2015, is the outcome indicator. It has a value of 0 if the insolvency
results in a piecemeal sale and a value of 1 if the outcome results in a continuing business. On thisindicator, Canada has a value of 1.
The small fall in the pillar’s ranking is explained by the decline in three of the fiveindicators of the pillar with the other two unchanged. Despite this slight deterioration in ranking,the ease of resolving insolvencies in Canada is relatively high.

32
4.

Getting Credit

Canada also does well in getting credit, ranking 15th in 2020, up from 7th in 2007. Canada
does extremely well in the depth of credit information index scoring 8 out of 8. It also does
extremely well in the proportion of the adults with credit bureau coverage, at 100 per cent or fullcoverage. On the other hand, it does less well in the strength of legal rights index, scoring 9 out of
12. Canada also has no public registry coverage of adults. None of the five indicators in the getting
credit pillar appears to have fallen in absolute terms over the 2007-2020 period so the fall inranking must reflect improvement in the performance in other countries. Despite this decline inranking, Canada remains a country where the ease of getting credit is fairly high.
5.

Paying Taxes

Canada’s ranking on the paying taxes pillar at 19th in 2020 is somewhat better than theoverall DBI ranking of 23rd. This pillar was the only one of the 10 DBI pillars whose ranking
improved between 2007 and 2020. Indeed, in 2007, the pillar paying taxes had the second worst
ranking at 22nd place among the ten pillars. In 2020, it had the fifth best ranking. This turnaroundreflected more the deterioration of the ranking of other pillars than the improvement in the rankingof the paying taxes pillar.
The paying taxes pillar has five indicators. In 2020, the number of procedures for making
tax payments in Canada was 8, down from 10 in 2007. The number of hours per year needed forbusiness to pay taxes was 131, up from 119 in 2007. The total business tax rate in 2020 was 24.5
per cent, down substantially from 43.0 per cent in 2007. In 2017, a fourth indicator was added tothe paying taxes pillar, the post-filing index from 0 to 100. This index measures the regulatory bestpractices of the indicator. Canada does relatively poorly on this metric as its introduction in 2017
reduced Canada’s ranking for the paying taxes pillar from 9th to 17th place (the other indicators
were identical in both years).
While there are areas for improvement, Canada performs adequately on the paying taxes
pillar. Canada is the top decile in the countries of the world for ease of paying taxes.
6.

Registering property

Canada does not do particularly well on the registering property pillar. In 2020, Canada
ranked 36th, down from 22nd in 2007. The deterioration was due to the doubling of the cost ofregistering property, from 1.7 per cent of the property value in 2007 to 3.8 per cent in 2020. The
other three indicators in this pillar fell over time in absolute terms. The number of procedures forregistering property dropped from 6 in 2007 to 5 in 2020. The number of days needed to registera business property fell from 10 to 4 between 2007 and 2020. In 2016, a fourth indicator was

33
introduced to this pillar, the quality of land administration index (from 0 to 30). In 2016, Canada’sscore on this index was 21.5. Canada’s ranking on the pillar in 2016 improved to 42nd place from55th in 2015. As the values of the other three indicators were identical in 2015 and 2016, theintroduction of this indicator was behind the improved ranking.
Canada’s performance on this pillar is not particularly impressive. Its ranking at 36 th place
is worse than Canada’s 23rd overall DBI ranking. The pillar ranking fell 14 places between 2007
and 2020. However, we have not included this pillar among the ones to receive detailed analysis
because four other pillars did much worse, both in terms of their 2020 ranking and theirdeterioration in ranking between 2007 and 2020.
The following sub-sections looks at developments for the four worst performing pillars:trading across borders, dealing with construction permits, enforcing contracts, and getting
electricity.
C.

Trading across borders

This sub-section sheds light on the reasons for the deterioration of the ranking of the trading
across borders pillar for Canada from 8th place in 2007 to 51st place in 2020. The methodology
for the pillar is presented first, followed by an examination of trends in the indicators that make up
the pillar.
1.

Methodology

The indicators that comprise the trading across borders pillar from 2007 to 2015 were
documents, time, and cost of exporting and importing, as shown in Table 2. Documents are all thenecessary paperwork (e.g., bank documents, customs declaration and clearance documents etc.)
for trading activities. The time for exporting and importing is recorded in calendar days. If a
procedure can be completed more quickly, then the legally fastest way is chosen and if several
procedures can be completed in parallel, then the time needed for each procedure is not cumulated.
The cost includes the fees levied on a 20-foot container in U.S. dollars, but does not include thetariffs or trade taxes. Signatures were defined as an approval, signature or stamp from all levels
that concludes one or more procedures. Electronic signatures were valid.
In 2016, the variables that compose the trading across border pillar of the DBI weremodified. The new variables are the time and cost of documentary compliance and bordercompliance for export and import, except in 2016 there was also a variable entitled "domestictransport" for the time and cost of these international exchange activities. The documentarycompliance includes the obtaining, preparation and submission of documents concerning transport,
clearance, inspections, port or border handling in the economy where the exchange takes place, as
well as the documents requested by the country with which the business is concluded. Border34
compliance refers to customs clearances and inspections by other agencies (applied if more than
20 per cent of the goods are inspected) and handling and inspections that take place at theeconomy's port of border.
Equal weighting is assigned to the different components of the pillar. For example, fortrading across borders in 2007-2015, a weight of one third was assigned for the documents toexport and import (all documents to export and import), one third for the time to export and import(document preparation, customs clearance and inspections, port and terminal handling, inlandtransport and handling) and one third for the cost to export and import (US$ per 20-foot container,
no bribes or tariffs included). In 2016-2020, a weight of one quarter was assigned to each of thefour indicators: export time, export cost, import time and import cost.
Chart 8: Rankings for the Trading across Borders Pillar, 2007-2020
08

Ranking

10
23

20
30

39

40

38
44

41

42

44

44

45

46

46

2017

2018

50

50

51

2019

2020

60
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

Year
Source: The World Bank’s reports for DB.

2.
Trends in the Indicators
Chart 8 provides rankings for the trading across borders pillar by year for the 2007-2020
period. Panel A of Table 2 gives the absolute values for the six indicators for the trading acrossborders pillar for five years for the 2007-2015 period and the 2016-2020 period and as wellprovides Canada’s ranking for each indicator. 12
Between 2007 and 2020, Canada's rank in the trading across border pillar deteriorated from
8th to 51st position. Between 2007 and 2009, there was a very large change in the ranking from
8th to the 44th. Between 2014 and 2015, the ranking fell from 45th to 23rd and then rebounded to44th in 2016. This appears to be a typographic error in the World Bank database as the values of
12

Appendix 1 gives the best (frontier) and worse values among all economies covered by the DBI for all indicatorsin the trading across borders pillar for selected years from 2007 to 2020

35
the indicators and their ranking in 2015 are virtually identical to those in 2014. Between 2016 and2020, the ranking deteriorated slightly from 44th to 51st. Consequently, to explain the fall in the
ranking, we must shed light on the factors behind the large change in ranking between 2007 and2009.
The numbers of documents Canadian businesses need to obtain to export goods was
unchanged at 3 between 2007 and 2015. Canada ranked extremely high on this indicator, between
first and third in the world over the 2007-2015 period. The number of documents Canadianbusinesses need to import was also stable over the 2015-2020 period at 3 or 4. Again, Canada
scored very high on this indicator, ranking third to sixth in the world.
The numbers of days Canadian businesses need to export was also virtually unchanged
between 2007 and 2015, falling from four to three. Canada ranked high on this indicator, ranking
either 8th or 9th in the world over the period. The number of days Canadian businesses need toimport was also stable over the period, but higher than for exporting, at 10-11 days. Canada’s
ranking on this indicator was less impressive, falling from 14th to 32nd. As the number of days
needed for importation in Canada was the same in 2007 and 2017 at 10 days, the deterioration in
the ranking must have meant that other countries moved to less than 10 days.
The fall in Canada’s ranking in the trading across borders pillar between 2007 and 2015
consequently was not linked to negative developments related to the number of documents toexport and import and the days needed to export and import.
The cost for a Canadian business to export a container to the US border rose from $700 US
in 2007 to $1,660 USD in 2009 and remained unchanged to 2015. This represents a massive
increase and results in Canada falling from 40th to 138th in the world for the cost to export
indicator. Whether this development reflects true cost developments will be examined shortly.
The cost for a Canadian business to import a container from the US border rose from $850
US in 2007 to $1,785 in 2009 and remained relatively stable to 2015. Again, this represents a
massive increase and resulted in Canada falling from 50th to 137th in the world for the cost toimport indicator. The accuracy of this development will be discussed shortly.
The indicators for the trading across borders pillar changed starting in 2016, as shown inPanel B of Table 2. The new indicators are documentary and border compliance in hours anddocumentary and border compliance in US dollars for both exports and imports.

36
As was the case with the earlier indicators (2007-2015), Canada does very well on the timeneeded for both documentary13 and border14 compliance procedures for both exporting andimporting and very poor in terms of costs. In 2020, only 1 hour was needed for documentarycompliance and 2 hours for border compliance for both exporting and importing. Canada ranked
first in the world for documentary compliance for both exporting and importing, 20th for bordercompliance for exporting and 26th for border compliance for importing.
In 2020, the cost for exporting was $156 US for documentary compliance and $167 US for
border compliance. Canada ranked 141st in the world for the former and 54th for the latter. The
cost for importing was $163 US for documentary compliance and $172 for border compliance in
2020. Canada ranked 132nd in the world for the former and 49th for the latter.
Canada’s ranking for trading across borders fell from 44th in 2016 to 51st in 2020. Yet all
absolute values for the eight indicators were unchanged between 2016 and 2020. Six of the eightrankings were also unchanged or virtually unchanged. The exceptions were the cost of
documentary compliance, which rose from a ranking of 118th in 2016 to 141st in 2020 for
exporting and from 117th to 132nd for importing over the same period. This means that thedeterioration in the trading across borders pillar ranking between 2016 and 2020 was not due tohigher costs or greater administrative burden in an absolute sense, but to other countries lowering
their costs and moving ahead of Canada.
Table 2 C shows how Canada compares in absolute terms to the average for OECD highincome countries for the indicators in the trading across borders pillar in 2020, and as well gives
the best regulatory performance and the number of economies with this performance. Not
surprisingly given the ranking discussed above, Canada greatly outperforms the average for thetime for exporting and importing, particularly for the cost of border compliance and underperforms
for cost, especially related to importing. One notes that 19-20 economies impose no cost for borderand documentary compliance to export and even more economies (28-30) impose no cost forborder and documentary compliance to import.

13

Documentary compliance measures the time in hours and cost associated with the logistical process needed toobtain, preparer and submit documents during transport, inspections and port or border handling in origin economy
and to obtain prepare and submit documents required by destination economy and any transit economies. This
covers all documents required by law and in practice, including electronic submissions of information. Costs include
insurance costs and informal payments and ae reported in US dollars at prevailing exchange rates.
14
Border compliance measures the time in hours and cost associated with the logistical processes related customs
clearance and inspections, inspections by other agencies, and handling and inspections that take place at theeconomy’s port or border.

37

Table 2: Trading Across Borders Pillar
Panel A: Canada’s Overall Ranking and Absolute Values for each Indicator of the Pillar 20072015
2007
2008
2009
2010
2011
2012
2013
2014
2015
Overall ranking
8
39
44
38
41
42
44
45
23
Absolute Values by Indicator
Exports
Documents to export(number)
Time to export (days)
Cost to export (US$ percontainer)

3

3

3

3

3

3

3

3

3

7

7

7

7

7

7

7

8

8

700

1,385

1,660

1,610

1,610

1,610

1,610

1,680

1,680

Imports
Documents to import(number)
Time to import (days)
Cost to import (US$ percontainer)

4

4

4

4

4

4

4

3

3

10

11

11

11

11

11

11

10

10

850

1,425

1,785

1,660

1,660

1,660

1,660

1,680

1,680

2007

Ranking by Indicator
Exports
2008
2009
2010
2011

2012

2013

2014

2015

Documents to export

2

1

2

2

2

2

2

3

3

Time to export

8

8

8

8

8

8

7

9

9

Cost to export

40

130

138

140

138

139

141

142

142

Imports
Documents to import

6

3

5

6

6

5

6

3

3

Time to import

14

20

22

25

27

28

35

30

32

Cost to import

50
122
137
125
127
124
126
125
127
Source: Ease of Doing Business Index Reports
Note: In order to find Canada’s positions, we ranked the countries from the smallest absolute value to the largest andif many countries had the same absolute value, we considered them all on the same position.

38
Canada’s Overall Ranking and Absolute Values for each Indicator of the Pillar 2016-2020

Overall ranking

2016
2017
2018
44
46
46
Absolute Values by Indicator

2019
50

2020
51

Time toexportDocumentary compliance (hours)

1

1

1

1

1

Border compliance (hours)

2

2

2

2

2

Cost toexportDocumentary compliance (US $)

156

156

156

156

156

Border compliance (US $)

167

167

167

167

167

Time toimportDocumentary compliance (hours)

1

1

1

1

1

Border compliance (hours)

2

2

2

2

2

Cost toimportDocumentary compliance (US $)

163

163

163

163

163

Border compliance (US $)

172

172

172

172

172

2018
1
20
139
51
1
27
126
47

2019
1
21
141
52
1
27
131
48

2020

Time toexportCost toexportTime toimportCost toimportRanking by Indicator
2016
2017
Documentary compliance (hours)
2
1
Border compliance (hours)
20
20
Documentary compliance (US $)118
133
Border compliance (US $)50
50
Documentary compliance (hours)
1
1
Border compliance (hours)
27
27Documentary compliance (US $)117
123
Border compliance (US $)
49
47

1
20
141
54
1
26
132
49

Source: Ease of Doing Business Index Reports and CSLS calculations
Note: In order to find Canada’s positions, we ranked the countries from the smallest absolute value to the largest andif many countries had the same absolute value, we considered them all on the same position. Note ranking
methodology changed between 2015-2016.

39
Panel B: Frontier and worst performance for the Trading Across Borders Indicators, 2007-2009,2015, and 2020
2007
2008
2009
2015
Documentstoexport (number)Time to export(days)
Cost to export (US$per container)
Documents
toimport (number)Time to export(days)
Cost to import(US$ per container)

Frontier

Worst
Performance

Frontier

Worst
Performance

Frontier

Worst
Performance

Frontier

Worst
Performance

2

16

3

13

2

13

2

11

3

105

5

102

5

102

6

54

265

4,300

390

4,867

450

5,367

410

5,000

2

20

3

18

2

18

2

15

3

139

3

104

3

104

4

66

333

4,565

367

5,520

439

6,020

368.4

6,000

2020
Frontier

Worst Performance

1
1
0
0

170
160
400
1,060

1

240

Border compliance (hours)
Documentary compliance (US$

1
0

280
700

Border compliance (US$)

0

1,200

Documentary compliance (hours)
Border compliance (hours)
Documentary compliance (US$)
Border compliance (US$)
Documentary compliance (hours)

Source: The World Bank’s DB reports
Notes:
a. Defined as 1 hour even though in many economies the time is less.
b. Worst performance is defined as the 95th percentile among all economies in the Doing Business sample.
c. Worst performance is defined as the 99th percentile among all economies in the Doing Business sample.

40
Panel C: Canada’s performance on the Trading Across Borders Indicators relative to OECD highincome countries and the best performance, 2020
Indicator
Time to export: Bordercompliance (hours)
Cost to export: Border compliance(USD)
Time to export: Documentarycompliance (hours)
Cost to export: Documentarycompliance (USD)
Time to import: Bordercompliance (hours)
Cost to import: Border compliance(USD)
Time to import: Documentarycompliance (hours)
Cost to import: Documentarycompliance (USD)
Source: The World Bank Report, 2020.

CanadaOECD high income

Best Regulatory
Performance

2

12.7

1 (19 Economies)

167

136.8

0 (19 Economies)

1

2.3

1 (26 Economies)

156

33.4

0 (20 Economies)2

8.5

1 (25 Economies)

172

98.1

0 (28 Economies)1

3.4

1 (30 Economies)

163

23.5

0 (30 Economies)

Chart 9: Cost to Export and Import for Canada
Panel A: Data from DB’s Reports
2000
1800

Dollars

1600
1400
1200
1000
800
600
400
2007

2008

2009

2010

Cost to export (US$ per container)
Source: The World Bank’s reports for DB

2011

2012

2013

2014

Cost to import (US$ per container)

2015

41
Panel B: Data from DB’s Website
2200
2000

Dollars

1800
1600
1400
1200
1000
2006
2007
2008
2009
2010
Cost to export (US$ per container deflated)

2011
2012
2013
2014
2015
Cost to import (US$ per container deflated)

Source: The World Bank (https://www.doingbusiness.org/en/custom-query )Note from the web-site: “To provide a comparable time series for research, the dataset is back-calculated to adjust for any revisions
in data due to corrections. Each change in methodology is back calculated for one year to provide comparable data for the previous
year. For this reason, the historical data published on this webpage may be different from the data published in theirrespective Doing Business reports”.

3.

Did Transport Costs Double between 2007 and 2009?

The analysis has revealed that the key reason that Canada has seen a fall in its ranking forthe trading across borders pillar over the 2007-2020 period was the result of the more than doublingof the transport cost to export and import between 2007 and 2009. We will now look at thisdevelopment.
The rise in the cost of importing and exporting between 2007 and 2009 in the World Bank’s
estimates of the indicators for the trading across border pillar in the DB report for Canada (Chart
9, Panel A) is very puzzling. Indeed, it is inconsistent with trends in this indicator reported in the
DB database on the World Bank website, which shows no major change in the cost of exportingand importing in Canada between 2007 and 2009 (Chart 9, Panel B). The absolute cost of exportingand importing was about the same in both charts in 2009 at around $1,800 US.
The more than doubling of the cost of exporting and importing in Canada between 2007
and 2009, as shown in the trading across borders pillar of the DBI for Canada, appears inconsistent
with overall price developments in the country at the time. The GDP deflator rose only 4 per centfrom 2007 to 2009 (Statistics Canada, Table: 36-10-0223-01). Thus, it seems extremely unlikelythat trade costs could more than double in this period of relative general price stability. In addition,
during the financial crisis over the 2007-2009 period, the cost of transport fell sharply. The most
likely explanation for the inconsistency in the two price trends appears to be data error. This meansthat the large increase in trading costs between 2007 and 2019 in the DBI estimates for Canada isa data error and that the DB database captures the true development, namely stability.

42

The upshot of this analysis is that it is likely the cost of exporting and importing in Canada
in 2007 given in the DBI report is incorrect. This means that Canada’s ranking on the cost ofexporting and importing indicators and consequently the overall trading across borders pillar in2007 should have been worse. This would mean that Canada’s ranking on the trading acrossborders pillar likely did not deteriorate between 2007 and 2009. 15

D.

Dealing with Construction Permits

Chart 10: Dealing with Licenses (until 2009), Dealing with Construction Permits (since 2009)
0
20

32

26

29

29

29

25

Ranking

40

53

57

54

2016

2017

2018

69

60

63

64

2019

2020

80
100

116

118

2014

2015

120
140
2007

2008

2009

2010

2011

2012

2013

Year
Source: The World Bank’s reports for DB

Canada’s ranking in the dealing with licenses/dealing with construction permits pillar also
dropped considerably between 2007 and 2020, down 32 places from 32nd to 64th. In 2009, thedealing with licenses pillar was changed to the dealing with construction permits. This change
appears to have had no effect on the overall ranking of the pillar, which was 32nd in 2007 and 29th
in 2009. This analysis will focus on the post-2009 period.

15

This analysis of the details of the trading across borders pillar has raised a number of issues that may merit further
investigations. These issues include the following. 1) Are the prices shown for export and import costs expressed inconstant or current dollars; 2) One observes that the values for all indicators for the trading across borders pillar are
identical from 2010 to 2013 and from 2016 to 2020. What is the reason for this?3) The distance between a country’s
border and the city chosen for the DBI vary by country How is this factored into the cost of importing and exportingwhich is linked to distance? 4) What was the change in methodology or definitions that produced the time needed toexport from 8 days in 2015 to 3 hours in 2016?

43
The ranking of the construction permits pillar has varied considerably over the 2009-2020
period, rising from 29th in 2009 to a peak of 18th in 2015 before falling to 64th in 2020 (Chart 10
and Table 3).
The number of indicators that make up the construction permits pillar has changed overtime. From 2009 to 2014 there were three indicators: number of procedures for a business to obtaina construction permit to build a warehouse, days needed to obtain the permit, and cost, as measured
by per cent of income per capita. In 2015, this cost indicator was dropped and replaced by a costindicator based on the per cent of the value of the warehouse. In 2017, a fourth indicator wasadded, building quality, measured by an index from 0 to 15. The introduction of the fourth indicator
had a major effect on Canada’s ranking on the pillar.
The number of procedures16 needed for a business to obtain a construction permit to build
a warehouse in Canada (Toronto) has been falling gradually over time. It was 14 each year from2009 to 2011, falling to 13 in 2013 and 2014 and then falling to 12 in 2015 and remaining at thisnumber until 2020. The world’s best practice for number of procedures is five and the worst
performance is 30. Canada is fortunately closer to best than worse practice. Even with the fall in
the number of procedures from 14 to 13 between 2009 and 2014, Canada’s ranking on thisindicator deteriorated from 48th to 73rd. The ranking did subsequently improve between 2015
and 2020 and by 2020 Canada ranked 41st overall.
The number of days to obtain a construction permit to construct a warehouse has massively
increased over time in Canada (Toronto).17 In the 2007-2012 period it took 75 days to obtain aconstruction permit. In 2013, this jumped to 163 days and in 2014 to 249 days where it remained
until 2020. The world’s best practice for number of days to obtain a permit is 26 days and the worst
performance is 373 days. Canada’s ranking in this indicator dropped from 15th in 2007 to 160th
in 2014. The very large increase in this indicator between 2012 and 2014 had a major impact on
Canada’s ranking for the construction permits pillar, which fell from 25th in 2012 to 116th in 2014.
Such a large increase in the number of days needed to obtain a construction permit seems strange.
This development needs a proper explanation and should be investigated with experts in the area.
The 2020 Doing Business Report for Canada provides a breakdown of the 249 days foreach of the 12 procedures. By far the most time-consuming procedure, requiring 180 days or
nearing three quarters of the time, is to obtain site plan approval from the Toronto Municipal

16

The number of procedures to legally build a warehouse includes the following: submitting all relevant documents
and obtaining all necessary clearances, licenses, permits and certificates; submitting all required notifications andreceiving all necessary inspections; obtaining utility connections for water and sewerage; and registering and sellingthe warehouse after its completion.
1717
The time required to complete each procedure in calendar days does not include time spent gathering
information, requires each procedure to start on a separate day, does not consider the procedure complete until a
final document is received, and assume no prior contact with officials.

44
Authority. The World Bank notes that a City councillor may become involved in the review of thesite plan and community consultation may be requested by the planner. The process can take from
3 to 9 months depending on the complexity of the site plan, political interests, and the number ofrevisions to meet the city’s requirements.
The cost, which is the official cost only (excluding bribes), for a business to obtain aconstruction permit to construct a warehouse was 103.7 per cent of per capita income in 2007 in
Canada (Toronto). The cost fell over time and by 2014, the last year this indicator was included in
the construction permits pillar, was 61.0 per cent. Despite this reduction in cost, Canada’s ranking
for this indicator did not see improvements, deteriorating from 68th in 2009 to 70th in 2014.
In 2015, a new cost indicator was introduced to replace cost of a proportion of per capita
income, namely the cost of obtaining a construction permit for a warehouse as a share of the valueof the warehouse. This includes attorney fees, court costs and enforcement of judgment. The value
for this indicator was 1.3 per cent in the 2015-2017 period, rising to 1.8 per cent in 2020. The
world’s best practice for cost of obtaining a permit to construct a warehouse was zero per cent of
the value of the warehouse and the worst performance was 20 per cent. Despite the rising cost
between 2015 and 2020, Canada’s ranking on this pillar improved, falling from 82nd to 73rd. As
the relative ranking of the two cost measures were similar, the move to the new definition of costin 2015 had no major effect on the ranking of the overall.
In 2016, a new indicator was added to the construction permits pillar, a building quality
control index. The values of the index ranged from 0 to 15. 18 Canada did very well in absoluteterms on this measure, with a value of 14 in all years from 2016 to 2020. In relative terms, Canada’s
performance was also impressive. Canada ranked 2nd in 2016, dropping slightly to 8th in 2020 asseveral other countries moved to an index value of 15. The addition of this indicator to theconstruction permits pillar in 2016 significantly improved Canada’s ranking from 118th in 2015
to 53rd in 2016. Again, this illustrates the importance of the choice of indicators for the ranking,which in many ways is arbitrary.

18

The building quality control index (0-15) contains six components: quality of building regulation (0-2); quality
control before construction (0-1); quality control during construction (0-3); quality control after construction (0-3);
liability and insurance regimes (0-2); and professional certifications.

45
Table 3: Dealing with Construction Permits Pillar
Panel A: Overall Ranking and Absolute Value for each Indicator of the Pillar, 2009-2020
Rank
Procedures(number)
Time (days)
Cost (% ofincome percapita)Cost (% ofwarehousevalue)
Building
qualitycontrol index(0-15)

Procedures(number)Time(days)
Cost (% ofincome percapita)Cost (% ofwarehousevalue)
Building
qualitycontrol
index (015)Overall Ranking and Absolute Values by Indicator
20112012 2013 20142015 2016
2017
29
25
69
116
118
53
57

2009
29

2010
29

14

14

14

12

13

13

12

12

75

75

75

73

163

249

249

249

103.7

100.7

101.0

57.5

64.1

61.0

N/A

2018
54

2019
63

2020
64

12

12

12

12

249

249

249

249

N/A
1.3

N/A

1.3

1.3

1.9

1.8

1.8

14.0

14.0

14.0

14.0

14.0

2009

2010

2011

2012

Ranking by Indicator
2013 2014
2015

2016

2017

2018

2019

2020

48

47

47

48

69

73

72

57

51

44

44

41

15

18

18

17

97

160

167

163

169

167

167

168

68

71

69

65

70

70

N/A

N/A
82

N/A

81

75

78

77

73

2

3

4

4

8

Source: World Bank, Doing Business Reports
Note: In order to find Canada’s positions, we ranked the countries from the smallest absolute value to the largest (except for the building quality
control index) and if many countries had the same absolute value, we considered them all on the same position.

46
Panel B: Frontier and worst performance on the Dealing with Construction Permits Indicators,
2015-2016
2015

2016

Frontier

Worst
Performance

Frontier

Worst
Performance

5

30

5

30

26

373

26

373

0.0

20.0

0.0

20.0

15

0

Procedures(number)
Time (days)
Cost
(%
of
warehouse value)
Building
qualitycontrol index (015)

N/A

Source: World Bank, Doing Business Reports

Notes:
b. Worst performance is defined as the 95th percentile among all economies in the Doing Business sample.
c. Worst performance is defined as the 99th percentile among all economies in the Doing Business sample.
d. Worst performance is the worst value recorded.

Panel C: Canada’s performance on the Dealing with Construction Permits Indicators relative toOECD high income countries and the best performance, 2020
Indicator
Procedures (number)Time (days)
Cost (% of warehouse)
Building quality control
index (0-15)
Source: The World Bank Report, 2020.

CanadaOECD high income

12
249
1.8
14

12.7
152.3
1.5
11.6

Best Regulatory
Performance
None in 2018/19
None in 2018/19
None in 2018/19
15.0 (6 Economies)

47

E.

Enforcing Contracts

According to the DBI, the environment for the enforcement of contracts by business has
significantly worsened in Canada, with the enforcing contracts pillar down 84 places from 16th in2007 to 100th place in 2020 (Chart 11 and Table 4). This deterioration took place in two stages
between 2007 and 2009, when the ranking rose from 16th to 58th and between 2016 and 2017
when the ranking rose from 49th to 112th.
Chart 11: Ranking for the Enforcing Contracts Pillar, 2007-2020
0
16
20
43

Ranking

40

49
58

58

58

60

59

58

62

65

80
96
100

112

114

2017

2018

100

120
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2019

2020

Year

Source: The World Bank’s reports for DB

Over the 2007-2020 period the enforcing contracts pillar was composed of three indicators.
Two of these indicators, time and costs, were unchanged over the period. One original indicator
was replaced. In 2016, the indicator for number of procedures was dropped and an index of thequality of juridical processes introduced. This change had a minor effect on Canada’s ranking in
the pillar.
The number of procedures needed for a business to enforce a contract in Canada was 17 in2007 and rose to 36 in 2008, remaining at this number until this indicator was dropped in 2015.
The world’s best practice for number of procedures for enforcing contracts in 2015 was 21 and theworst performance was 53. Canada ranked close to best practice in 2007 with a ranking of 5th.
However, given the more than doubling of the number of procedures, Canada dropped to 64th
place in 2015.

48
In 2016, the index of the quality of juridical processes was introduced to replace the numberof procedures indicator. This new index includes court structure and proceedings (1-5), casemanagement (0-6), court automation (0-4) and alternative dispute resolution (0-3). The values forthis index run from 0 (lowest quality) to 18 (highest quality). The value of the index for Canada(Toronto) was 10.5 in 2016, rising to 11.0 by 2020. In terms of the breakdown of this score, Canada
received 4 out of 6 for court structure and proceedings, 2 out of 6 for case management, 3 out of 4
for court automation, and 2 out of 3 for alternative dispute resolution.
Canada ranked 46th on this indicator in 2016, rising slightly to 48th in 2020. As Canada
ranked 64th in the former indicator in 2015, the move to the better ranked juridical quality indicatorin 2016 boosted Canada’s ranking for the pillar from 65th in 2015 to 49 th. The absolute values ofthe other two indicators were unchanged between 2015 and 2016 and their ranking also almost
unchanged, meaning that the 16-place improvement in the pillar’s ranking can be attributed to themethodological changes brought by the move to the quality of juridical processes indicator.
There have been major increases in the time needed to enforce contracts through the courts
in Canada (Toronto). This enforcement includes time to file and serve the case, time for the trial
and to obtain the judgement and time to enforce the judgment. In 2007, this time was 345 calendar
days. It then nearly doubled to 570 days in 2008 and stayed at this level to 2016. In 2017 it again
increased significantly to 910 days and remained at this level through 2020. These 910 days arebroken down into 30 days for filing and service, 150 days for enforcement, and 730 days for trial
and judgement. It is this latter category, which is exactly two years, that accounts for Canada’s
poor result on this pillar.
The world’s best practice for number of days for contract enforcement is 120 days and theworst performance is 1,340 days. Canada’s ranking in this indicator dropped from 47th in 2007 to
97th in 2008 and then to 160th in 2017. Canada’s performance on this measure is truly shocking,both in absolute and relative terms. It takes 2.5 years to obtain a juridical order for contract
enforcement and Canada is in the bottom quintile of countries in the world on this indicator,
including the developing countries. As the saying goes, justice delayed is justice denied.
The cost of enforcing contracts, which includes average attorney fees, court costs, andenforcement costs, has also increased in Canada (Toronto). In 2017, costs as a percentage of thevalue of the claim were 12.0 per cent. This increased to 16.2 per cent in 2008 and then to 22.3 percent in 2009 and has remained unchanged at this level until 2020. The breakdown of the 22.3 percent is 15.0 per cent for attorney fees, 5.3 per cent for court fees and 2.0 per cent for enforcement
fees. The world’s best practice for contract enforcement costs is 0.1 per cent of the claim and theworst performance is 89 per cent. Canada’s ranking on this indicator was 32nd in 2007 and fallingto 69th in 2009, remaining around this number up to 2020.

49
Table 4: Enforcing Contract Pillars
Panel A: Canada’s Overall Ranking and Absolute Values for each Indicator of the Pillar, 2004-2020
Overall Ranking and Absolute Values by Indicator
2004
Rank

-

Procedures
17(number)
Time (days) 425
Cost (% ofclaim)
Quality of
judicial
processes
index(0-18)

Procedures
Time
Cost (% of Claim)

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

-

-

16

43

58

58

58

59

62

58

65

49

112

114

96

100

17

17

17

36

36

36

36

36

36

36

36

346

346

346

570

570

570

570

570

570

570

570

570

910

910

910

910

12.0

12.0

12.0

16.2

22.3

22.3

22.3

22.3

22.3

22.3

22.3

22.3

22.3

22.3

22.3

22.3

10.5

9.5

9.5

11.0

11.0

2005

N/A

2007
5
47
32

Quality of judicial
process index (018)

Ranking by Indicator
2009
2015
62
64
97
101
60
52
N/A

N/A

2016

2020
N/A

98
53

160
51

46

48

Source: World Bank, Doing Business Reports
Note: In 2004, there were two other indicators entitled “procedural-complexity index (0-100)” and “cost (% of income per capita)”.
The first one, higher values indicated more procedural complexity in enforcing a contract. For Canada, in 2004, its value was 29.
The second, included “court costs and attorney fees, as well as payments to other professionals like accountant and bailiffs” (World
Bank, 2004). The value was 28.0.
Note: In order to find Canada’s positions, we ranked the countries from the smallest absolute value to the largest (except for thequality of judicial processes index) and if many countries had the same absolute value, we considered them all on the same position.

50

Panel B: Frontier and worst performance for Enforcing Contracts Indicators, 2015-2016
2015
2016
Worst
Frontier
Frontier
Worst Performance
Performance
Procedures
21
N/A
53
(number)
Time (days)
120
120
1,340
1,340
Cost (% of
0.1
0.1
89.0
89.0
claim)
Qualityofjudicial
N/A
18
0
processes index(0-18)
Source: World Bank, Doing Business Reports
Notes:
b. Worst performance is defined as the 95th percentile among all economies in the Doing Business sample.
c. Worst performance is defined as the 99th percentile among all economies in the Doing Business sample.
d. Worst performance is the worst value recorded.

Panel C: Canada’s performance on Enforcing Contracts Indicators relative to OECD high income
countries and the best performance, 2020
Indicator

Canada910
22.3

OECD highincome589.6
21.5

Best Regulatory
Performance120 (Singapore)
0.1 (Bhutan)

Time (days)
Cost (% of claim value)
Qualityofjudicial
processes index (0-18)

11.0

11.7

None in 2018/19

Source: The World Bank Report, 2020.

F.

Getting Electricity

The largest deterioration in ranking was for the employing workers/getting electricity pillar
dropping 111 places from 13th to 124th (Chart 12 and Table 5). In other words, the replacementof the employing workers pillar, which the World Bank dropped from the DBI in 2011 in response
to objections from labour groups, by the getting electricity pillar resulted in an upward shift in
Canada’s ranking. Indeed, when the getting electricity pillar was introduced in 2012, with a dismal
ranking of 156th place, Canada’s DBI ranking rose five places from 7th, in 2011, to 13th, in 2012.

51
Chart 12: Ranking for the Getting Electricity Pillar 2012-2020
020
40

Ranking

60
80

105

100
120
140

156

152

2012

2013

145

150

2014

2015

108

105
121

124

2019

2020

160
180
2016

2017

2018

Year
Source: The World Bank’s reports for DB

Canada’s poor performance on getting electricity is surprising. Canada is a world leader inboth the production of electricity and in the electricity generation and transmission technologies.
This section examines the four indicators that comprise the getting electricity pillar to shed lighton Canada’s poor performance and to assess whether it reflects the Canadian reality, or rather is
specific to Toronto, the city for which the estimates of the indicators are gathered.
From 2011 to 2015 there were only three indicators: number of procedures for getting
electricity,19 number of days needed to get electricity,20 and cost of getting electricity,21 as apercentage of per capita income. In 2016, a fourth indicator was added, an index of reliability ofsupply and transparency of tariffs as expressed from 0 to 8. 22 The actual price of electricity is notincluded in the ease of doing business score nor in the ranking on the ease of getting electricity.
While Canada has always ranked in the bottom half of the economies for the getting
electricity pillar covered by the DBI over the 2012-2020 period, there have been fluctuations(Table 5). The ranking was relatively stable from 2012 to 2015 in the 145-156 range. It improved
to 105th in 2016 with the introduction of the reliability measure as Canada performed much better
19

The procedures to obtain an electricity connection for a newly constructed warehouse include submitting all
relevant documents and obtaining all necessary clearances and permits; completing all required notifications andreceiving all necessary inspections; obtaining external installation works and possibly purchasing materials for theseworks; and concluding any necessary supply contract and obtaining final supply.
20
The time required to complete each procedure is at least 1 calendar day with each procedure starting on a separate
day, does not include time spent gathering information, and reflects the time spent in practice, with little follow-up
and no prior contact with officials.
21
The cost is official costs only and excludes bribes and value added taxes.
22
The reliability of supply and transparency of tariffs index (0-8) includes six components: duration and frequencyof power outages (0-3); tools to monitor power outages (0-1); tools to restore power supply (0-1); regulatory
monitoring of utilities’ performance (0-1); financial deterrents limiting outages (0-1); and transparency andaccessibility of tariffs (0-1).

52
on this indicator (46th) than on the other indicators. Since then, Canada’s performance has steadily
deteriorated, with the ranking rising to 124th by 2020.
Canada does particularly poorly in the number of procedures required for a new businesselectricity hook-up. This number was 8 in 2012 and 2013 and then fell to 7 from 2014 to 2020.
The world best practice is 3 and the worst performance is 9. Given that Canada is close to the worst
in the number of procedures, its ranking on this indicator is very poor, 169th in 2012 and 162nd in
2020.
Canada also did poorly in terms of time required for a new business electricity hook-up. In
2012, 168 days were needed. This fell to 142 days in 2013 and then fell again to 137 days where
it remained for the rest of the decade. The world best practice is 18 days, and the worst
performance is 248 days. Given that Canada is closer to the worst than to the best, its ranking on
this indicator is high, 156th in 2012 and 171st in 2020. Canada’s relative performance has
deteriorated over time even though in absolute terms Canada is improving. This suggests othercountries are improving at a faster rate.
The 2020 Doing Business Report for Canada provides a breakdown by procedure of the
130 days needed for an electricity connection. The time needed to submit the application to
Toronto Hydro and await comments on the proposal is 15 calendar days. Next is 13 days needed
to await completion and approval of project design, followed by 22 days to submit the final design
to Toronto Hydro and await the offer to connect. It then takes 80 days for the completion of theexternal works by Toronto Hydro. Given that over 60 per cent of the days are in this stage, it islikely here that Canada performs poorly compared to other counties. It is unclear if Hydro
Toronto’s performance is typical of electricity providers in Canada.
The cost to a new business of obtaining an electricity hook-up in Canada in 2012 was 143.9
per cent of income per capita, which seems high. This cost has fallen steadily over time and by
2020 was 116.9 per cent of income per capita. The world best practice is apparently 0, that is nocost for a new business to get electricity while the worst performance is 8,100 per cent of per capita
income. Canada is far from this number, ranking 50th in 2012, and 63rd in 2020. Again, one notesthat Canada’s relative performance fell while its absolute performance improved as other countries
improved faster.
In 2016, Canada received a score of 6 out of 8 on the index for the reliability of electricity
supply and transparency of tariffs and obtained the same score in three of the following four years(the score rose to 7 in 2018). Canada ranked 46th on this indicator in 2016, falling to 59th in 2020.
Canada’s poor performance on getting electricity is suspect, especially when compared tothat of other G7 countries. In 2019 Germany ranked 5th, the UK 7th, France 14th, Japan 22nd,

53
Italy 37th. and the United States 54th. Australia, which is very similar to Canada in many ways
ranked 52nd.
As noted earlier, the poor performance may reflect the situation in Toronto. Other parts ofthe country may be more, or less, efficient and cost effective for a new business to obtainelectricity. In any case, the inclusion of the getting electricity pillar in the DBI in 2012 madeCanada’s overall DBI ranking worse.
Table 5: Getting Electricity Pillar
Panel A: Overall Ranking and Absolute Values by Indicator of the Getting Electricity Pillar, 20122020
Overall Ranking and Absolute Values by Indicator
20122013 2014 2015 2016 2017 2018 2019 2020
Rank
156
152
145
150
105
108
105
121
124
Procedures
8
8
7
7
7
7
7
7
7
(number)
Time (days)
168
142
142
142
137
137
137
137
137
Cost (% of income
143.9 140.4 131.8 131.0 126.1 125.8 125.3 119.8 116.9
per capita)
Reliability ofsupply and
N/A
6
6
7
6
6
transparency oftariffs index (0-8)
Ranking by Indicators
2012
2016
2020
Procedures
169
156
162
Time
156
163
171
Cost (% of income
50
60
63
per capita)
Reliability of supply
and transparency of
N/A
46
59
tariffs index (0-8)
Source: World Bank, Doing Business Reports, and CSLS calculations.
Note: In order to find Canada’s positions, we ranked the countries from the smallest absolute value to the largest
absolute value, if many countries had the same absolute value, we considered them all on the same position.

54
Panel B: Frontier and worst performance for Getting Electricity, 2016-2020
Frontier
Procedures(number)
Time (days)
Cost (% pf income
per capita)
Reliability of supply
and transparency oftariffs index (0-8)

2016-2020
Worst
Performance

3

9

18

248

0.0

8,100.080Source: World Bank, Doing Business Reports
Notes:
b. Worst performance is defined as the 95th percentile among all economies in the Doing Business sample.
c. Worst performance is defined as the 99th percentile among all economies in the Doing Business sample.
d. Worst performance is the worst value recorded.

Panel C: Canada’s performance on Getting Electricity Indicators relative to OECD high income
countries and the best performance, 2020
Indicator
CanadaOECD highBest Regulatory
incomePerformance
Procedures (number)
7
4.4
3 (28 Economies)
Time (days)
137
74.8
18 (3 Economies)
Cost (% of income per
116.9
61.0
0.0 (3 Economies)
capita)Reliability of supply andtransparency of tariff
6
7.4
8 (26 Economies)
index (0-8)
Source: The World Bank Report, 2020.

G.

Explaining Canada’s DBI Performance

Drawing on the above analysis, this sub-section has two objectives. The first is to explain
which pillars and indicators account for Canada’s 23rd ranking in 2020 on the DBI, well belowthat found in other competitiveness and economic environment indexes. The second is to explain
the deterioration in Canada’s ranking from 4th in 2007 to 23rd in 2020. The discussion focuses on
the role of the four pillars with the worse performance, both in terms of the worse rankings in 2020
and the greatest deterioration between 2007 and 2020.

55
1.

Explaining Canada’s 23rd Ranking in 2020

Canada’s 23rd place in the DBI in 2020 is largely explained by the four pillars with theworst ranking: the 124th ranking on getting electricity, the 100th ranking on enforcement ofcontracts, the 64th ranking on getting construction permits, and the 51st ranking on trading acrossborders. Excluding these four pillars, the average ranking of the six other pillars in 2020 was 15th.
The preceding analysis identified the specific indicator or in some cases indicators in eachpillar that is the most important in contributing to the pillar’s poor ranking in 2020.
For the getting electricity pillar, Canada did very poorly for the indicator on time needed
to obtain an electricity connection, ranking 137th out of 190 economies in the DBI in 2020.

For the enforcing contracts pillar, Canada ranked 160th on the indicator on time needed to
enforce a contract.



For the construction permits pillar, Canada ranked 168th on the indicator on time needed
to obtain a construction permit.



For the trading across borders pillar, Canada ranked 142nd in cost of exporting and 127th
in cost of importing.
2.

Explaining the Fall in Canada’s DBI Ranking

In 2007, the first year the DBI released country rankings, Canada ranked 4th out of 176
economies. By 2020, Canada had fallen 19 places to 23rd out of 190 countries. The four pillars
with the worse rankings in 2020 were also the four pillars whose ranking deteriorated the mostbetween 2007 and 2020.


the ranking for the enforcement of contracts pillar fell 86 places from 16th in 2007 to 100thin 2020. This deterioration was largely driven by the indicator for time needed to enforce
contracts which fell from 47th in 2007 to 160th in 2020. In absolute terms, the time forcontract enforcement rose from 346 days to 910 days.



the ranking for the trading across borders pillar fell 43 places from 8th in 2007 to 51st in
2020, reflecting the developments related to the cost of exporting (40th to 142nd) and costof importing (50th to 127th).



The ranking for dealing with construction permits fell 35 places from 29th in 2007 to 64th
in 2020. This change was completely explained by the massive deterioration in the ranking

56
for the indicator on days needed to obtain a construction permit from 15th to 168th. In
absolute terms, the number of days rose from 75 to 249.


the introduction of the getting electricity pillar into the DBI in 2012 as a replacement for
the employing workers pillar further contributed to the fall in Canada’s ranking. Canada
ranked 13th in the employing workers pillar in 2007, 111 places lower than the rank ofgetting electricity pillar in 2020 (124th).

The average fall in ranking of the four pillars between 2007 and 2020 was 68 places. As these
indicators represent 40 per cent of the weight of the overall DBI, they moved Canada’s ranking by
27 places (68*0.4). In contrast, in five other pillars Canada’s ranking fell by much less, an averageof 6 places. With their 50 per cent weight, these pillars boost the DBI around 3 places (5*0.5).
These numbers are approximations as the overall DBI is not an average of the rankings of the ten
pillars, but an average of the scores of the ten pillars. Nevertheless, they provide an idea of theimportance of the deterioration of the ranking on these four pillars for Canada’s overall fall in its
DBI ranking.
For three of the four pillars that account for the lion’s share of the deterioration in Canada’s
ranking in the DBI between 2007 and 2020 it was the indicator for time to obtain a required
outcome result (construction permit, contact enforcement, or electricity connection) that has
resulted in Canada’s current performance. Assuming the indicators collected by the World Bank
are accurate, this suggests Canada may have problems related to these characteristics of thebusiness environment.
Chart 4 shows that there were three discrete upward shifts in Canada’s DBI ranking
between 2007 and 2020: from 4th in 2007 to an average 7th place by 2008-2011. Then to an
average 16th place in 2012-2016, and, lastly to an average 22nd place in 2017-2020. The threedrivers of these shifts have now been identified and are highlighted below.
The shift between 2007 and 2008-2011 was due to increased cost of exporting andimporting in the trading across borders pillar that took place in 2008 and 2009 and thefall in the enforcing contracts ranking, also between 2007 and 2008.



The upward shift between 2008-2011 and 2012-2016 is largely explained by the
introduction into the DBI in 2012 of the getting electivity pillar in which Canada fares
poorly and the fall in the ranking dealing with construction permits pillar between 2012
and 2014.

57


The upward shift between 2012-2016 and 2017-2020 was caused by the large increasein 2017 in the indicator the time needed to enforce contracts in the enforcement ofcontracts pillar.
H.

Concerns over the DBI Results for CanadaThis detailed examination of the DBI pillars and indicators for Canada has led to the identificationof a number of data issues and broader questions.
1.

Data Issues

The trends in a number of the DBI indicators are suspicious in two respects. First, someindicators remain unchanged for long periods. For example, the cost in Canada of both
documentary and border compliance for both exporting and importing are the same in all five years
from 2016 to 2020. One might expect that there would be some year-to-year variation in thequestionnaire responses from the experts surveyed. Second, some indicators manifest very unusualchanges over short period. For example, the cost of both exporting and importing in Canada havemore than doubled between 2007 and 2009. One might expect that the reason for such largechanges would be provided in the DB reports, but this is often not the case. The more than doublingof the cost of exporting and importing in Canada in the late 2000s remains a mystery that defies
common sense. This casts doubt on the validity of the DBI finding that Canada in 2020 ranked
poorly on the trading across borders pillar and has experienced a deterioration over time in thisarea.
While Toronto may be Canada’s most important city, its business environment may not be
representative of the national picture, especially in areas covered by municipal jurisdiction.
Consequently, it may be misleading to conclude that the fall in the DBI ranking from 4th in 2007
to 23rd in 2020 for Canada based on data collected for Toronto applies to the overall country. Thisis especially the case given that two of the pillars responsible for Canada’s decline in ranking,obtaining business permits and getting electricity are regulated by the local City of Toronto
Planning Authority and Hydro Toronto. These municipal organizations may have very different
procedures than comparable bodies in other municipalities. The World Bank does not appear tohave investigated this issue.
The values for DBI indicators are generally expressed as means (averages). For certain
indicators such as time needed to resolve court cases, there may be significant differences between
the median and mean values. A small number of extremely long court cases may boost the mean
with no effect on the median. Yet it is the median that may well be more relevant for mostbusinesses.

58
It can be argued that the DBI ranking scheme represents a zero-sum game. If one country
improves its ranking, another country must experience a fall, even when both countries enjoy
absolute improvement in the DBI. From this perspective, trends in absolute scores may be more
relevant or meaningful than trends in ranking in assessing how a country’s environment for doing
business is evolving. The World Bank has published scores for the DBI and the pillars since 2015.
Canada’s DBI ranking fell from 16th in 2015 to 23rd in 2020 while Canada’s score actually
increased from 79.1 to 79.6 over the period (Table 6). For the trading across borders pillar,
Canada’s ranking fell from 23rd to 51st while the score rose from 86.1 to 88.4.
Table 6: Comparison between Scores and Rankings for the DBI and Pillars for Canada, 2015 and2020

Overall
Starting a Business
Dealing with construction
Permits
Getting electricity
Registering Property
Getting Credit
Protecting Minority Investors
Paying Taxes
Trading across Borders
Enforcing Contracts
Resolving Insolvency

2015
79.09
98.82

Scores
2020
79.6
98.2

Change0.51-0.62

Rankings
2015
2020 Change
16
23
-7
2
3
-1

67.12

73

5.88

118

64

54

59.27
76.2
85
72.5
93
86.07
63.76
89.17

63.8
77.8
85
84
88.1
88.4
57.1
81

4.53
1.6
0
11.5
-4.9
2.33
-6.66
-8.17

150
55
7
7
9
23
65
6

124
36
15
7
19
51
100
13

26
19
-8
0
-10
-28
-35
-7

Source: The World Bank’s reports.

2.
Broader issues
In addition to the data concerns discussed above, the detailed examination of the DBI
pillars and indicators has raised two issues: the overall importance of the specific indicators on
which Canada underperforms for the ease of doing business in this country and the neglect ofenvironmental regulation issues.
The DBI gives equal weight to all 41 indicators in the ten pillars. Yet the indicators andthe pillars are not all equally meaningful for business for two reasons. First, the indicator may
not be particularly important for the operation of business. For example, if a process requires alarge number of procedures to complete, yet can be done quickly and cheaply, the fact that
Canada scores poorly on the number of procedures may not be important, even though it reduces
the ranking. Second, there may be behavioural response to a poor performance on an indicatorthat would reduce the negative effect of this performance on doing business. For example, longtimes for resolving court cases may provide an incentive for parties to settle quickly out of court.
The DBI reports for Canada provide little insight into the relative importance of the different

59
indicators on which Canada does poorly, such as the long time needed to get electricity, to obtain
construction permits, and to enforce contracts.
A recent National Post article entitled “Canada can’t get things done” (Hopper, 2021)
made the case that Canada appears to not be achieving objectives in a number of areas, including
military procurement, pandemic response, pipelines, transit, clean water on reserves, diplomacy,
dams and 24 Sussex Drive renovations. This message seems consistent with Canada’s fall in the
DBI from 4th to 23rd since 2007, with the deterioration driven by the increased time required to
get things done. What is interesting is that the DBI indicators do not cover environmental
regulation where delays can be long, and approval often denied. Had this area of doing businessbeen include in the DBI Canada’s ranking may well have been lower.

V.
Comparing the DBI with Other International Competitiveness andEconomic Environment Indexes
Table 7: Canada’s Ranking for Competitiveness Indices 2007-2020
GlobalWorld Bank
IMD WorldCompetitiveness
Ease of Doing Competitiveness
Report World
Business Index
Ranking
Economic Forum

Cato
Institute
Human
Freedom
Index

FraserInstitute
Index of
Economic
Freedom

6
6
7
7
8
5
4
7
5
4
6
-

8
7
7
7
6
6
6
6
6
6
7
9
8
9

OECD
product
marketregulation
indicators

OECD
Employment
Protection
Regulation
Indicators

year
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020

7
8
8
7
12
17
19
13
20
22
18
22
23
23

10
8
8
7
7
6
7
7
5
10
12
10
13
8

16
10
9
10
12
14
14
15
13
15
14
12
14
-

18

17

34

6
8
8
8
9
9
8
11
8
7
7
7
7

Source: Global Competitiveness Report for each year, compiled by CSLS; Cato Institute’s human freedom
index report for each year, compiled by CSLS;
https://worldcompetitiveness.imd.org/customsearchresults/criteriaresult;

60
https://stats.oecd.org/index.aspx?DataSetCode=PMR#; https://stats.oecd.org/Index.aspx?DataSetCode=EPL_T;
Website of the Fraser InstituteAs was noted earlier in the report, since 2007 the trends in the DBI and four other well-known
international competitiveness or economic environment indexes have diverged. As shown inChart 5 on page 22 and in Table 7, Canada’s position in the IMD World Competitiveness Index,
the World Economic Forum Global Competitiveness Index, the Cato Institute Human Freedom
Index the Fraser Institute Index of Economic Freedom have been fairly stable over the 20072020 period, while Canada’s ranking in the DBI has fallen from 4th to 23rd place.
The objective of this section is to look at how Canada has fared on these four measures ofinternational competitiveness and economic environment and on two OECD measures of thebusiness environment. The section also compares trends in a number of specific indicators where
Canada has done particularly poorly according to the DBI with comparable indicators in the fourindexes. This allows one to ascertain if the latter are consistent or inconsistent with the reported
DBI developments.
A.

IMD World Competitiveness Index

The IMD World Competitiveness Ranking is an annual report on the competitiveness ofcountries produced by the IMD Business School in Switzerland. It benchmarks the performanceof 63 countries, based on more than 332 criteria (two thirds statistical data and one third surveydata). The IMD World Competitiveness Ranking is divided into 4 subsections, economic
performance, government efficiency, business efficiency and infrastructure. Each of these four
subsections is divided into five components, making a total of 20 components, as shown in
Table 8.
In 2020, Canada moved up to 8th from 13th in 2019 on the IMD World Competitivenessranking. In 2007, Canada had ranked 10th. This recent improvement is centered around
improvements in measures related to its labor market and in the openness of its society. Canada
also became the top-ranking country in the Americas in 2020 when the overall ranking for theUnited States fell from 3rd to 10th in 2020.
Canada did equally well in the sub-sections, ranking 8th for infrastructure and 10th foreconomic performance, government efficiency, business efficiency. In terms of the components,
Canada ranks in the top five countries on 2 of 20 components, education (4), and labor market (5),and between 5th and 10th for an additional 9 of the 20 components. Canada scores outside the top
25 in 2020 on three components, international trade (49), employment (28) and domestic economy(21). The poor score on international trade is consistent with Canada’s poor performance on thispillar in the DBI.

61
Respondents of the Executive Opinion Survey, which informs several of the componentsof the IMD World Competitiveness Ranking, selected high education level, skilled workforce,
policy stability and predictability as the most attractive factors of the Canadian economy. The
country report for 2020 indicates that Canada’s major challenges for 2020 include a shortage ofskilled digital talent to meet demand in high growth sectors like technology, challenges scaling
start-ups including lack of digital adoption among SME’s, lack of incentives to draw foreign direct
investment in key areas like technology. Additionally, the report highlights the digital divide
related to the uneven access to digital connectivity infrastructure across the country.
Table 8: Components of the IMD World Competitiveness Ranking, 2020.
2020
Rank
Overall Performance

2020
Rank

8

Economic Performance

10

Business Efficiency

10

domestic economy

21

productivity and efficiency

19

international trade49

labor market

5international investment

8

Finance

6

Employment

28

management practices

7

Prices9

attitudes and values

12

Government Efficiency

10

Infrastructure

8

public finance20

basic infrastructure

8

tax policy

17

technological infrastructure

14

institutional framework

10

scientific infrastructure

19business legislation

17

health and environment

8

societal framework

10

Education

4

Source: https://www.imd.org/wcc/world-competitiveness-center-rankings/competitiveness-country-profiles/

The challenges identified by the IMD above differ significantly from the most important
weaknesses in the environment for doing business in Canada identified in the deep dive on the
DBI, namely, getting electricity, enforcing contracts, and dealing with construction permits. Thismay be explained by the different focus of the two reports. The IMD report is much wider inorientation, defining competitiveness in terms of many factors as outlined above. In contrast, the62
DBI is much narrower, focusing on business regulations and practices. Indeed, the IMD report has
no specific indicators on time needed to enforce contracts, to obtain a construction permit and to
make an electricity connection, the three indicators that contributed significantly to Canada’s 23rd
DBI ranking in 2020 and the deterioration in the ranking between 2007 and 2020.
In addition to its World Competitiveness Ranking, the IMD also publishes the World
Competitiveness Digital Rankings (IMD, 2020). Canada did not perform quite as well on thisindex, ranking 12th out of 63 countries in 2020 compared to 8th on the World CompetitivenessRankings. Both IMD indexes include a subfactor called regulatory framework. In 2020, Canada
placed 12th out of 63 countries on the regulatory framework, compared to 23rd out of 190 countries
on the DBI, which is largely focused on business regulation. If one excluded from the DBI ranking
the countries not in the set of 63 countries covered by the IMD, Canada would rank 15th which iscomparable to the IMD ranking.
Two of the indicators in the IMD regulatory framework index correspond to DBI pillars,
namely starting a business and enforcing contracts. The IMD ranks Canada 2nd out of 63 countries
on starting a business. The DBI ranking on this pillar is 3rd out of 190. Both metrics show that
Canada is a stellar performer in this area.
The IMB ranks Canada 50th out of 63 countries on enforcing contracts. The DBI ranking is
100 out of 190 countries. Both metrics show that Canada performs poorly in this area. In relative
terms, the IMD ranking shows Canada does worse than the DBI ranking.
This consistency across indexes for these two indicators in the IMD and DBI rankings
supports the validity of the DBI indicators.
B.

World Economic Forum Global Competitiveness Report

The Global Competitiveness Index (GCI) 4.0 produced by the Geneva-based World
Economic Forum measures national competitiveness—defined as the set of institutions, policies
and factors that determine the level of productivity. It offers insights into the economic prospectsof 141 countries. The 2019 Global Competitiveness Index ranges from 0-100 where having ahigher score is indicative of a more competitive environment. The results of the GCI in 2019 reveal
that, on average, most economies continue to be far from the competitiveness “frontier”—theaggregate ideal across all factors of competitiveness. The GCI is currently based on 13 components
with 19 specific indicators.
The World Economic Forum’s Global Competitiveness Report 4.0 ranked Canada 14th outof 141 countries in 2019. Canada’s ranking between 2007 and 2019 in the Global CompetitivenessIndex has been relatively stable. Canada ranked 10th in 2008, the first year the GCI was estimated.

63
The best rank was in 2009, where the country ranked 9th. Otherwise, the ranking stayed
consistently between 10 and 16.
Canada in 2019 ranked in the top ten on three subcomponents, macroeconomic stability(1st), labour market efficiency (8th), and financial market sophistication (9th) (Table 9). Canada
also ranked outside the top 20 on three subcomponents in 2019, ICT adoption (35th), infrastructure(26) and goods market efficiency (product market) (24th).
Between 2008 and 2018 Canada experienced a massive improvement in its rank on
macroeconomic stability from 43rd to first. On all the 10 other components for which ranking areavailable for both years, Canada’s ranking fell, with the largest fall in infrastructure (6th to 25th),
goods market efficiency (product market) (16th to 24th), and health and primary education (6th to
14th)Table 9: 2008 and 2019 Global Competitiveness Report World Economic Forum, Canadiancomparison for each subcomponent

1
2
3
4
5
6
7
8
9
10
11
12
13

Overall score
Institutions
infrastructure
ICT adoption
macroeconomic stability
health and primary education called
health in 2019higher education and training calledskills in 2019
Goods Market efficiency (productmarket)labor market efficiency
financial market sophistication
technological readinessmarket size
business dynamism
innovation capability

2008
rank
10/134
15
6
43

2019
rank
14/141
13
26
35
1

6

14

9

12

16
7
10
9
14
-

24
8
9
16
12
16

Source:https://www.weforum.org/reports/how-to-end-a-decade-of-lost-productivity-growth;
http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2008-09.pdf
Note: the 2019-2020 Global Competitiveness Report 4.0 covers 141 countries. Scores are ranked from 0-100 for 20192020 where 100 represents the ‘frontier’ an ideal state where an issue ceases to be a constraint to productivity growth.

64
The 2019 report was published on October 8, 2019. The Global Competitiveness Report 2008-2009 was publishedMarch 4, 2008. 2008-2009 data is normalized on a 1-7 scale, and rankings are out of 131 countries.

1.

Comparing WEF and DBI rankings at the indicator level

The Canada profile for the WEF’s Global Competitiveness Index (GCI) report provides
Canada’s ranking out of 141 countries for the individual indicators for the 12 WEF pillars in 2019.
It is instructive to compare the indicators that match those found in the DBI for 2020.
Canada does very poorly on the getting electricity pillar of the DBI, ranking 124th out of
190 countries in 2020. In contrast, Canada does much better in the WEF indicators related to utility
regulation. Canada ranked an extremely impressive 2nd out of 141 countries in electricity accessof the population in 2019. Canada did much less well in electricity supply quality, ranking 69th.
Although the exact definitions of the electricity-related indicators differ between the GCI and the
DBI, the GCI results suggest that the DBI may be overstating Canada problems related toelectricity. The DBI measure is very narrow, related to the cost and time needed for an industrialsite electricity hook-up in Toronto, while the WEF is much broader. Both measures may of course
be accurate.
The DBI ranks Canada quite high in the getting credit pillar, at 15th out of 90 countries.
Canada also does very well on the GCI’s indicator for domestic credit to the private sector, ranking
4th out of 141. The DBI ranks Canada poorly in dealing with construction permits, with Canada
ranking 64th or at the 66th percentile. The GCI indicator for the quality of land administration alsoranks Canada relatively poorly, 49th out of 141 countries (71st percentile). Because the DBI and
GCI indicators are different, these similarities support the accuracy of the DBI results for thesetwo pillars.
The DBI and GCI rankings are also very similar for two other DBI pillars, starting abusiness and resolving insolvency. The GCI ranks Canada 2nd out of 141 countries in the time tostart a business, compared to 3rd in the DBI. The GCI ranks Canada 9th in the cost of starting abusiness, identical to the ranking in the DBI. The GCI ranks Canada second in the solvency
recovery rates, compared to 10th in the DBI. In terms of the insolvency regulatory framework, theGCI ranks Canada 49th compared to 55th in the DBI. As the insolvency framework index goesfrom 0-16 for each ranking; it appears that the WEF uses the World Bank data. This also appears
to be the case for the starting business measures. This makes comparison not meaningful since themeasures are not independent.

65
2.

Transformation readiness performance

In December 2020, the WEF published the 2020 Global Competitiveness Report: How
Countries are Performing on the Road to Recovery (Schaub and Zahidi, 2020), This report differedfrom past reports in not updating the rankings for the 13 areas of competitiveness in 141 countries
found in earlier Global Competitiveness Reports. Rather it provided scores in 11 categories oftransformation readiness for 36 countries.
Table 10 shows Canada’s performance in terms of both score and ranking in these 11
categories. The average ranking for the category is also given, with the top and bottom performing
country in the category and their score.
The CSLS has calculated that Canada ranked 6th out of 36 countries for the global averagescores based on the average score for each of the 11 categories. 23 Canada had an above averagescore in 10 categories of the 11 categories, only falling slightly below average (77.0 versus 78.7)
in the category “upgrading infrastructure to accelerate the energy transition and broaden access toelectricity and ICT.” Ironically, despite the below average score, this category was the one where
Canada achieved its highest score. Canada appears to be doing a good job in upgrading
infrastructure, but most other developed countries are doing even better.
Canada ranked in the top ten among the 36 countries in six of the 11 categories: second(perhaps surprisingly) for rethinking competition and anti-trust frameworks; third for expanding
eldercare childcare and healthcare infrastructure; seventh in shifting to a more progressive tax
system; eighth in rethinking labour laws and social protection; ninth in ensuring public institutions
embed strong governance principles, and tenth in updating education curriculum.
Canadas’s sixth place ranking on the World Economic Forum’s transformation readinessperformance categories contrasts with our 23rd ranking in the DBI. This is in part explained by
the much fewer countries in the WEF set of countries than the DBI (36 versus 190). There were
11 countries above Canada in the DBI ranking which are not in the WEF ranking. 24 When thesecountries are dropped, Canada moves up to 10th place in the DBI ranking, much closer to its sixth
place in the WEF ranking. Indeed, Canada now ranks at the 94th percentile (10/178) of countries
for the DBI ranking, well above its 80th percentile (6/36) for the WEF categories.
An additional factor explaining the divergence in the ranking is that the WEF categories
are much broader and forward looking, while the DBI pillar are narrowly focused on number ofprocedures, time, and cost of various aspects of the ease of doing business. From that angle, it is
not surprising that the rankings differ.
23This ranking is based on the country aggregate average scores calculated as an average of the 11 category scoresfor each county, not as an average ranking of Canada’s ranking on the 11 categories.
24
Singapore, Hong Kong, Georgia, Norway, Lithuania, Malaysia, Taiwan, United Arab Emirates, North Macedonia,
Latvia, and Thailand

66
Table 10: Canada’s Performance on Economic Transformation Priorities, by 2020 score
Canada’s Mean
HighestLowest
score
1

2
3

4
5

Ensure public institutions embedstrong governance principles and a longterm vision and build trust by serving theircitizens
Upgrade infrastructure to accelerate theenergy transition and broaden access toelectricity and ICT
Shift to more progressive taxation,
rethinking how corporations, wealth andlabour are taxed, nationally and in aninternational cooperative framework
Update education curricula and expand
investment in the skills needed for jobs and“markets of tomorrow”
Rethink labour laws and social protection
for the new economy and the new needs ofthe workforce

Expand eldercare, childcare and Healthcare
infrastructure, access and innovation for the
benefit of people and the economy
7 Increase incentives to direct financial
resources towards long-term investments,
strengthen stability and expand inclusion
8 Rethink competition andanti-trust frameworks needed in the Fourth
Industrial Revolution,
ensuring market access, both locally andinternationally
9 Facilitate the creation of "markets of
tomorrow", especially in areas that require
public-private collaboration
10 Incentivize and expand patient investments
in research, innovation and invention thatcan create new "markets of tomorrow"
11 Incentivize firms to embrace diversity,
equity and inclusion to enhance creativity
Aggregate(values based on a simple average of the 11priorities above)

6

rank

60.0

78.5
Finland

42.84
Russia

9

78.7

99.8
Estonia

57.2
Russia

23

56.7

50.0

65.2
South
Africa30.7
Hungary

7

65.3

55.3

75.3
Finland38.8
Greece

10

69.8

61.4

77.0
Denmark

42.9
SouthAfrica

8

61.6

47.8

75.9
Sweden24.7
Greece

3

75.1

69.2

95.4
Finland32.8
Argentina

17

74.7

62.0

77.6
USA

42.5
Russia

2

49.5

45.1

59.5
Finland34.3
Argentina

10

42.8

41.6

57.3
USA

25.2
Greece

17

66.5

62.2

79.2
China

45.1
India

13

67.0
77.0

64.2

6

Source: https://www.weforum.org/reports/the-global-competitiveness-report-2020, pg. 74-76, and pg. 45-46 (tables
5.1 and 5.2)
Note: scale goes from 0-100
Notes: They offer a preliminary assessment, using available statistics, of the approximate state of countries. The 2020
Global Competitiveness Report Special edition, 2020 was published on December 16, 2020. Ranks are given out of
36 countries for performance on economic transformation readiness by aggregated 2020 score (0-100 scale).

67
C.

The Fraser Institute Index of Economic Freedom

The Fraser Institute’s Index of Economic Freedom (IEF) ranks countries based on
economic freedom; “the fundamental rights of every human to control his or her own labour orproperty.” The index is composed of twelve pillars evaluated for 186 different countries whichassess the freedom of movement, coercion, and constraint of liberty. The index ranks countries
based on the twelve freedoms (pillars) grouped into four categories, rule of law, government size,
regulatory efficiency, and open markets. Each country’s overall score is derived by averaging thetwelve economic freedoms with equal weights given to each pillar.
The index is on a 0-100 scale where 100 is completely free, and 0 means completely
repressed. The Index of Economic Freedom classifies countries into five categories based on theirscores, (1) Free with a score of 100-80, (2) mostly free with a score between 79.9 -70, (3)moderately free with a score between 69.9-60, (4) mostly unfree 59.9-50, and (5) repressed with ascore between 49.9-0. Scores for 2020 were compiled based on data and information up to June30, 2020.
Canada ranked 9th overall in 2020, with a score of 78.2 meaning Canada is categorized by
the index as mostly free. Since 2007, Canada’s ranking has remained stable, as seen in Table 11.
The Index of Economic Freedom’s Country Report for 2020 highlighted labour market rigidity
and increased government spending as factors contributing to the drop in Canada’s score fromabove 80 (free) in 2014. However, Canada does rank first in the Americas, beating the UnitedStates by 1.6 points. Canadas scores have increased for two pillars (rule of law and open markets)since the 2019 publication but decreased in the regulatory efficiency pillar due in part to increases
in annual leave and sick leave benefits.
In 2020, Canada did particularly poorly in four pillars: government spending (145th),
monetary freedom (105th), tax burden (103rd), and fiscal health (87th). On the other hand, Canada
placed in the top ten countries for financial freedom (4th), government integrity (7th) and property
rights (8th). Between 2007 and 2020 Canada’s ranking improved in 3 of 10 pillars (two pillars
were added after 2007), namely government integrity (from 14th to 7th), investment freedom (43rdto 21st place), and financial freedom (18th to 4th place). Canada’s ranked much worse in 2020
than in 2007 on monetary freedom (105th versus 38th) and at least 20 places worse for tax burden(77th to 103rd), government spending (125th to 145th), business freedom (2nd to 22nd), labour
freedom (17th to 37th).

68
Table 11: Fraser Institute Index of Economic Freedom Rankings for 2007 and 2020, Canada
2007
Overall Ranking
8
Pillars' Rankings
Property Rights
1
Judicial Effectiveness
N/A
Government Integrity
14
Tax Burden
77
Government Spending
125
Fiscal Health
N/A
Business Freedom
2
Labor Freedom
17
Monetary Freedom
38
Trade Freedom
5
Investment Freedom
43
Financial Freedom
18

2020
9
8
21
7
103
145
87
22
37
105
13
21
4

Source: Author’s calculations using the website of the Fraser Institute.
Note: The rankings were calculated from the largest value to the smallest

1.

Comparing IEF and DBI indicators

The detailed indicators that make up the Index of Economic Freedom include a numberthat match indicators in certain DBI pillars. Table 12 shows the scores for these indicators for the
2007-2018 period. Unfortunately, the rankings for these indicators are not available.
The DBI ranked Canada 100th out of 190 countries in enforcing contracts. This poor
performance was also found in the IEF score for the legal enforcement of contracts indicator. Thisscore was 5.82 in 2018, well below the overall IEF score of 8.17. In addition, the score was downfrom 6.41 in 2007. This similarity in performance in 2018 and deterioration over time for the IEF
and DBI indicators related to the enforcement of contracts lends credibility to the DBI assessment.
A divergent picture is given by the two indexes on the compliance cost of importing andexporting. According to the IEF, Canada scored 9.89 out of 10 on this indicator in 2018. This
represents an almost perfect score so Canada must rank near the top on this indicator. In addition,
the score has been improving over time. In contrast, the DBI has four indicators related to thecompliance cost of exporting and importing and Canada ranks poorly in all four: 141st out of 190
on cost of documentary compliance to export, 132nd for cost of documentary compliance toimport; 54th on border costs to export; and 49th on border costs to import. The IEF Ranking
strongly suggest that the World Bank may be overestimating Canada’s compliance costdisadvantage for exporting and importing.

69
In terms of overall business regulation, the IEF gave Canada a score of 8.18 in 2018, up
slightly from 7.95 in 2007. The 2018 score was virtually identical with the overall IEF score of
8.17. suggesting that Canada’s ranking on business regulation may be similar to the country’s
overall IEF ranking of 9th place.
The DBI has no overall measure for business regulation, but several of the pillar capture
various aspects of regulation. These indicators tend to show a worse ranking than the IEF ranking
and a deterioration over time. From this perspective, the Fraser Institute paints a more positive
picture of the regulatory environment for business in Canada than does the World Bank.
The overall IEF business regulation indicator has six sub-indicators, with two of themmatching DBI pillars. The score for the starting a business indicator in 2018 was 9.95 out of 10,
an almost perfect score. This indicator has been consistently high over time, at 9.83 in 2007. The
DBI ranks Canada 3rd out of 190 countries in the starting a business pillar, so the two indexes
provide a consistent message on this measure.
The second indicator under business regulation is licencing restrictions. The Fraser
Institute gives Canada a score of 6.85 in this indicator in 2018, well below the overall score of 8.17
and down significantly from 9.83 in 2007. In other words, the IEF identifies a deterioration in theease of obtaining licences in Canada over the past decade. This is consistent with the situation in
the dealing with construction permits pillar of the DBI. Canada ranked 64th in 2020, down from32nd in 2007. This suggests that the two indexes are picking up the same trend, namely that
Canadian business are having greater difficulties in obtaining licenses.

70
Table 12: Fraser Institute Scores for Canada, 2007-2018
Summary
Ratings
Summary
Rank
Legal enforcementof contracts
Compliance cost ofimporting andexportingBusinessregulations
Administrativerequirements
Regulatory
BurdenStarting abusiness
Impartial
PublicAdministration
Licensing
restrictions
Cost of Tax
compliance

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

8.23

8.21

8.18

8.18

8.08

8.18

8.23

8.33

8.19

8.24

8.26

8.17

7

6

5

5

6

5

5

5

7

6

6

9

6.41

6.41

6.41

6.41

6.41

6.28

6.16

6.16

5.57

5.57

5.82

5.82

8.89

8.89

8.89

8.89

8.89

8.87

8.87

9.89

9.89

9.89

9.89

9.89

7.95

7.95

7.95

8.55

8.28

8.22

8.29

8.31

8.21

8.19

8.28

8.18

4.23

4.26

4.37

4.22

4.10

4.45

4.74

4.73

4.61

4.69

4.56

4.83

5.44

5.44

5.44

9.09

9.09

9.78

9.78

9.78

9.33

9.11

9.78

8.89

9.83

9.84

9.84

9.84

9.84

9.84

9.84

9.95

9.95

9.95

9.95

9.95

10.00

10.00

10.00

10.00

10.00

10.00

10.00

10.00

10.00

10.00

10.00

10.00

9.51

9.51

9.51

9.63

8.14

6.75

6.86

6.86

6.86

6.85

6.85

6.85

8.67

8.67

8.53

8.53

8.53

8.53

8.53

8.53

8.53

8.53

8.53

8.53

Source: Fraser Institute’s Website.

D.

The Cato Institute Human Freedom Index

The Human Freedom Index (HFI) presents the state of human freedom in the world basedon a broad measure that encompasses personal, civil, and economic freedom. Human freedom is asocial concept that recognizes the dignity of individuals and is defined by the Cato Institute as
negative liberty or the absence of coercive constraint. The HFI is ranked on a scale of 0-10 where
higher values indicate higher levels of freedom. The average score for the 162 countries assessedfor 2018 was 6.3. The Human Freedom Index is split into two categories: personal freedom andeconomic freedom. These two categories are in turn broken down into 12 components and 76
distinct indicators.
In 2018, Canada ranked 6th overall, identical to their rank in 2008. While Canada’s scorein 2018 was higher for the personal freedom category (9.1 out of 10) than the economic freedom
category (8.17 out of 10), overall Canada ranked higher in the economic freedom category (9thversus 12th).
Despite Canada’s unchanged ranking between 2008 and 2018 for the overall HFI between
2009 and 2018, the ranking for both categories fell. The ranking for economic freedom dropped
from 6th to 9th and the ranking for personal freedom declined from 12th to 13th.

71
Among the sub-indicators for the personal freedom category, Canada scores highly in thesafety and security, movement, expression, and information, and relatively weaker on rule of law
and religious freedoms. For the economic freedom category, Canada’s score is pulled downward
due to the size of government, and the legal systems and property rights sub-indicator due to lower
scores on impartiality of the courts and legal enforcement of contracts.
Canada scores 9.7 or higher for security safety, movement, expression and information,and identity and relationships in the personal freedom category. Canada scores below 9.0 in justtwo of the indicators on the personal freedom side (scores of 7.7 for rule of law and 8.3 for religious
freedoms)25. Canada’s economic freedom score is pulled downwards by the 6.7 scored for size ofgovernment. Canada also scored lower for economic freedom due to the 7.7 it scored in the legal
system and property rights category caused by lower scores on impartiality of the courts and legal
enforcement of contracts.
As noted, since 2008, the first year of the Human Freedom Index, Canada’s ranking has
been relatively consistent, increasing to fourth in 2014 and again in 2017 with an average rankingof 6th place. Canada’s lowest overall score was in 2015 at 8.61.
Table 13: The Human Freedom Index for Canada, Scores over Time2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Overall
6
6
7
7
8
5
4
7
5
4
6
Ranking
Human
Freedom
8.66 8.65 8.65 8.6 8.64 8.68 8.73 8.61 8.64 8.69 8.64
Index
Components' Scores
Personal
9.11 9.12 9.12 9.12 9.09 9.13 9.12 9.03 9.04 9.12 9.1
Freedom
Rank
12
13
Economic
8.21 8.18 8.18 8.08 8.18 8.23 8.33 8.19 8.24 8.26 8.17
FreedomRank
69
Source: The website of the Human Freedom Index; https://www.cato.org/sites/cato.org/files/2020-12/humanfreedom-index-2020.pdf
Note: The scale is from 0 to 10, 10 representing more freedom. The Human Freedom Index uses 76 different indicatorsof personal and economic freedom. The indexes presented in the above table are the overall indices for these two
indicators. The rankings were calculated from the largest value to the smallest.

25

Scores for subcomponents available on page 113 of https://www.cato.org/sites/cato.org/files/2021-01/humanfreedom-index-2020%5B1%5D.pdf

72
Table 14: The Human Freedom Index, for Canada, Scores for Economic Freedom Components,
2018
Score
Score
Economic Freedom

8.17

Size of Government
Government consumption
Transfers and Subsidies
Government Enterprise
Top Marginal Tax Rate
State Ownership of Assets
Legal Systems and Prop. Rights
Judicial Independence
Impartial Courts
Protection of Prop. rights
Military Interference
Integrity of the Legal System
Legal Enforcement of Contracts
Regulatory Costs
Reliability of Police

6.7
4.0
7.0
9.2
5.0
8.3
7.7
7.2
6.7
7.4
10.0
8.2
5.8
8.7
7.9

Sound Money
Money GrowthStandard Deviation of Inflation
Inflation: Most Recent Year
Freedom to Own Foreign Currency
Freedom to Trade Int’lTariffs
Regulatory Trade BarriersBlack Market Exchange Rates
Movement of Capital and People
Regulation
Credit Market Regulations
Labour Market Regulations
Business Regulations

9.6
9.3
9.5
9.5
10.0
8.1
7.0
7.9
10.0
7.5
8.8
10.0
8.1
8.2

Source: The website of the Human Freedom Index; https://www.cato.org/sites/cato.org/files/2020-12/humanfreedom-index-2020.pdf

E.

OECD Labour Market and Product Market Regulation Indicators

The OECD produces two indexes related to the business environment, an index of
employment protection regulation and an index of product market regulation. The premise is this:the lower the index and the level of regulation the more favourable the business environment. This
sub-section reviews these indexes.
1.

Labour Market regulation indicators

The OECD indicators of employment protection legislation evaluate the regulations on thedismissal of workers on regular contracts and the hiring of workers on temporary contracts. As
these indicators are from a business perspective, the better the ranking the fewer the labour market
protections. The indicators cover both individual and collective dismissals.
The indicators have been compiled using the Secretariat’s own reading of statutory laws, collective
bargaining agreements and case law as well as contributions from officials from OECD member

73
countries and advice from country experts. The OECD divides its Indicators of Employment
Protection into four sub-indicators: strictness of regulation of collective dismissals for workers on
regular contracts, strictness of dismissal regulation for workers on regular contracts (bothindividual and collective dismissals), strictness of regulation of individual dismissals of workers
on regular contracts and strictness of hiring regulation for workers on temporary contracts. To
better understand Canada’s position in these indicators the CSLS took an average of the rank ofeach sub indicator which is presented in the fifth column of Table 15.
The four-employment protection legislation indicator scores for Canada have remained
unchanged from 2007 to 2019, which is somewhat surprising. Canada ranked first or second on
three of the four indicators consistently over the period. Canada did poorly, however, for collective
dismissals, ranking 23rd in 2019 from 2007 to 2019. Canada’s overall ranking was 7th in 2019, up
slightly from 6th in 2007.
Canada’s high ranking on indicators of employment protection legislation indicates fewerrights for workers relating to dismissals relative to other countries. From a business perspective,
this represents a favourable environment in which to operate.
The OECD finding that Canada has a flexible labour market is supported by the ranking
given in the Employment Flexibility Index produced by the Lithuania Free Market Institute (2020).
Based on indicators related to regulations in four areas (hiring, working hours, redundancy rules,
and redundancy cost). Canada ranked fifth out of 41 OECD and EU countries in 2020, behind only
(in order) the United States, Japan, New Zealand, and the UK. France was last in the index,
followed by Luxembourg and Mexico. Canada also ranked fifth in 2018 and 2019.
The finding that Canada has a flexible labour market favourable to employers is consistent
with our ranking on the DBI pillar on employing workers. In 2007, Canada ranked 13th out of 190
countries on this measure. The ranking was 17th in 2010, the last year this pillar was included in
the DBI. It was replaced in 2012 by the getting electricity pillar, on which Canada does muchworse. This means that Canada’s strong performance in employing workers in not currently
reflected in the DBI and is one of the factors behind the country’s drop from 4th to 23rd place
between in the DBI between 2007 and 2020.

74
Table 15: OECD Employment Protection Legislation Indicators

collective
dismissals
(1)

2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020

Rank
17
27
27
27
29
29
25
38
26
22
23
23
23
-

Score
3.13
3.13
3.13
3.13
3.13
3.13
3.13
3.13
3.13
3.13
3.13
3.13
3.13

strictness of employment protection
collective
dismissals
individual(individual anddismissals
temporary contracts
collective dismissal(regular(4)of workers oncontract)
regular contracts)
(3)
(2)
Rank
score
rank score
rank
score
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
2
0.59
2
0.59
1
0.25
-

Average
(5)

rank
6
8
8
8
9
9
8
11
8
7
7
7
7
-

score
1.14
1.14
1.14
1.14
1.14
1.14
1.14
1.14
1.14
1.14
1.14
1.14
1.14
-

Source: https://stats.oecd.org/Index.aspx?DataSetCode=EPL_T
Note: Scores range from 0-6 where 0 means an oral statement or a written statement without reason is sufficient for
dismissal. For each year, indicators refer to the regulation in force on the first of January. All versions of theemployment protection legislation indicator are version 1 apart from the collective dismissals which is version 2.
Temporary contracts provide a rank out of 68 countries, while collective dismissals, individual dismissals, andindividual and collective dismissals provide a ranking out of 73 countries. For temporary workers (column 4) Canada
is tied with the USA.

2.

Product Market Regulation Indicators

The economy-wide Product Market Regulation (PMR) indicators measure the regulatory
barriers to firm entry and competition through eighteen low-level indicators, ranging from barriers
to FDI, to governance of SOEs, price controls, and complexity of regulatory procedures. The
OECD Product Market Indicators Database is updated every five years, with the latest iteration
being for 2018. Due in part to the change in methodology between 2013 and 2018, Canada fell
from 17th out of 36 OECD nations to 34th out of 36 OECD nations, beating only Turkey and theOECD’s newest member, Columbia. The 2018 data excludes the United States. In 1998, Canada
ranked 10th (see Table 16).

75

The OECD’s PMR Indicators assess the alignment of a country’s regulatory frameworkwith internationally accepted best practices. The scale goes from 0-6, where having a lower scoremeans regulations are more competition friendly, and 0 represents international best practices. As
shown in Table 17, the Economy-wide PMR Indicator is based on 18 low-level indicators. These
low-level indicators are then aggregated into six mid-level indicators, which are in turn aggregatedinto two high-level indicators and the overall indicator. At each step of aggregation, the composite
indicators are calculated as simple averages of their components.
In 2018, Canada scored 1.76 out of 6 on the overall PMR indicator as compared to theOECD average, 1.38. This means that Canada’s product market regulation is less competition
friendly than that of most OECD countries. However, the score is much closer to 0 andinternational best practice than to 6 so the absolute level of competition is fairly high.
For the six medium-level indicators, Canada scored best in barriers to trade and investment(1.01), followed very closely by simplification and evaluation of regulations (1.02). The other four
indicators were clustered around a score of 2, double that of the two best scoring indicators.
Administrative burden on start-ups scored 2.00, followed by involvement in business operations(2.14), barriers to service and network sectors (2.15) and public ownership (2.15). Canada’s
rankings for these six indicators were not always consistent with the scores. For example, while
Canada scored best on barriers to trade and investment, the country ranked only 31st out of 36
countries on this indicator. It appears that most countries also scored very well on this indicator.
For the 18 low-level indicators, Canada scored worst on licences and permits related to theadministrative burden of start-ups (4.00), followed by governance of state-owned enterprises(3.90) and public procurement (3.75). Canada’s ranking for these indicators was consistent withthe poor scores, 34th, 35th and 36th respectively on the three indicators. Canada scored best on
tariff barriers and administrative requirements related to start-up with a score of 0.00. Canada
ranked first on both indicators.
These OECD ranking are consistent in two instances with the rankings of the DBI pillars.
In the starting a business pillar in the DBI Canada ranked 3rd out of 190 countries. OECD data
indicate Canada ranked 1st out of 36 countries. In the obtaining construction permits pillar, Canada
ranked 64 out of 119. In the OECD product market regulation indicator on licences and permits,
Canada ranked 34 out of 36, an even worse performance in relative terms.

76
Table 16: Canada OECD Ranking for the OECD’s Economy-wide Product market Regulation
Index
Rank
Number ofCountries

1998
10
28

2003
16
30

Source: https://stats.oecd.org/index.aspx?DataSetCode=PMR#

2008
18
32

2013
17
36

2018
34
36

77
Table 17: Canada’s Ranking and Scores for the OECD’s Economy-wide Product Market
Regulation Index as compared with 36 other OECD countries, 2018
2018
Score
1.76

2018
Rank
34

High
Distortions Induced by State Involvement
Level
Indicators Barriers to Domestic and Foreign Entry

1.79

24

1.72

33

Public Ownership
Involvement in Business Operations
Medium Simplification and Evaluation of Regulations
Admin. Burden on Start-ups
Level
Indicators Barriers in Service & Network sectors
Barriers to Trade and Investment
Scope of SOEs
Gov’t Involvement in Network Sectors
Public Ownership
Direct Control
Governance of SOEs
Price controls
Involvement inCommand & control regulation
Business Operations
Public procurement
Assessment of Impact on Competition
Simplification and
Evaluation ofInteraction with Interest Groups
Low
Regulations
Complexity of Regulatory Procedures
Level
Admin. Requirements for Limited
Indicators
Liability Companies and PersonallyAdmin. Burden on
Owned Enterprises
Start-ups
Licenses and permits
Barriers in Service & Barriers in Services sectors
Network sectors
Barriers in Network sectors
Barriers to FDI
Barriers to Trade and Tariff Barriers
Investment
Treatment of Foreign Suppliers
Barriers to Trade Facilitation

2.22
2.14
1.02
2.00
2.15
1.01
3.04
1.00
0.94
3.90
1.37
1.31
3.75
0.75
1.64
0.67

24
36
8
32
28
31
20
4
14
35
24
20
36
5
8
17

0.00
4.00
3.22
1.07
0.97
0.00
1.93
1.13

1
34
31
8
32
1
31
27

Name of Component
Overall Indicator

Sourcehttps://stats.oecd.org/index.aspx?DataSetCode=PMR#;
https://issuu.com/oecd.publishing/docs/can_country_note_-_tot_final?fr=sNTJjNjkzNTk1MQ;
https://www.oecd.org/economy/reform/indicators-of-product-market-regulation/
Note: Scores are from an index scale which ranges from 0-6 where 0 represents international best practices.

78

F.

Concluding Remarks on Alternative Indexes

This section has shown that Canada does better on broad indexes on international
competitiveness and economic environment than on narrow indexes of the business environment
such as the DBI. Table 18 shows that Canada’s average ranking on the six alternative indexes
presented in this section in the most recent year was 13th. This lies in contrast to Canada’s 23rd
position on the DBI.
The OECD Product Market Regulation index is a benchmarking exercise of businessregulatory practices. It is closest in orientation to the DBI of all the six alternative indexes
discussed. Therefore, it is not surprising that Canada ranks much worse on this metric that on the
broader indexes, even worse than on the DBI. When the OECD Product Market Regulation index
is excluded from the average of the alternative indexes, Canada rises to 9th position.
It is interesting to note that the positioning of the G-7 countries in terms of the average ofthe ranking of the six alternative indexes is identical to that of the DBI. Among G7 countries on
the DBI, the United States ranked first, followed by the UK, then Canada and Germany close
together, and then Japan, France, and Italy. Table 18 shows the same relative positions for G7
countries for the average ranking on the six alternative indexes.
A number of the alternative indexes contain indicators comparable to those found in the
DBI. This allows one to ascertain whether the current ranking on certain DBI indicators, and thetrend over time, can be confirmed by other sources. The results are mixed. Non-DBI indicators
do show that Canada does indeed rank poorly on enforcing contracts and on obtaining construction
permits. On the other hand, non-DBI data do not support the DBI finding that Canada ranks poorly
in terms of the compliance cost of exporting and importing.

79
Table 18: Performance of G7 Countries on International Competitiveness Indexes 2020 or mostrecent year
Global
IMD World Competitiveness
Competitiveness Report World
Ranking out of
Economic
63 countries
Forum out of
137 countries
year
CanadaUSA
UK
Japan
France
Italy
Germany

8
10
19
34
32
44
17

Cato
Institute
Human
Freedom
Index outof 162
countries

14
2
9
6
15
30
7

6
17
17
11
33
31
9

OECD
OECD
Fraserproduct Employment
InstitutemarketProtection
index ofregulation Regulation
Economic
indicators
Indicators
Freedom
out of 36
out of 37
out of
OECD
OECD
186
countries
countries
9
6
13
20
58
51
21

34
1
22
28
15
4

average

7
1
5
12
29
28
27

Source: IMD out of 63 https://www.imd.org/wcc/world-competitiveness-center-rankings/competitiveness-countryprofiles/;
http://www3.weforum.org/docs/WEF_TheGlobalCompetitivenessReport2019.pdf;
https://www.cato.org/sites/cato.org/files/2021-01/human-freedom-index-2020%5B1%5D.pdf OECD EPR- authors
calculations from https://stats.oecd.org/index.aspx; https://stats.oecd.org/index.aspx?DataSetCode=PMR#
Note: the OECD EPR Indicators is an average of Canada's rank on the four sub-indicators calculated by the CSLS.
Data for the IMD World Competitiveness Ranking, & the Index of Economic Freedom is from 2020, the Global
Competitiveness Report and the OECD’s Employment Protection Regulation Indicators is from 2019, and the Cato
Institute’s Human Freedom Index and the OECD PMR is from 2018.

VI.

An Assessment of the World Bank Doing Business Index

This section of the report provides an overall assessment of the DBI. This section has four
sub-sections. The first briefly discusses the strengths and weaknesses of composite index ingeneral, as these points apply to the DBI. The second presents the results of three evaluations of
the DBI commissioned by the World Bank. The third briefly reviews outside critiques of the DBI.
The fourth discusses strengths and weaknesses of the DBI in the Canadian context.
A.

Composite Indexes in General

A composite index is defined as an aggregate of a set of indicators based on a weighting
scheme. The issue of composite index divides the research community. Some make the case thatcomposite index are extremely useful as they present a bottom line and thereby focus media andpublic interest on important topics. Others argue that composite indicators are dangerous as they

13
7
11
17
32
33
14

80
can be manipulated to present misleading results and that they should not be constructed. Thereare elements of truth to both views. But the reality is that it is impossible to prevent researchers
from constructing composite indexes. What is needed by both the users and the critics of composite
indexes is a better understanding of their appropriate uses and their limitations.
1.

Strengths of Composite Indexes

Composite indexes take a set of indicators in a database and create a single number for ajurisdiction at a point in time. This bottom line can then be compared both to other jurisdictions
and over time. In other words, countries can be ranked internationally on the composite index andtrends observed over time within a country. This bottom line focuses attention on a country’s
performance, which can be a positive incentive to take measures to improve that performance. If
the performance is good the country (or government) can use this information to promote itself
both to its citizens for political purposes and to persons outside the county to attract investment,
trade or migrants. For example, in the 1990s Prime Minister Chrétien frequently made reference
to Canada’s top ranking on the UNDP Human Development Index as evidence that Canada was“the best country in the world to live in.”A second positive effect of composite indexes is that they create a demand for data to
populate the indicators that make up each index. These data may already exist in some form andcan be developed where needed to put to use in the composite index and given more prominence.
Or new data may be created specifically for the index, as is the case for the data arising fromquestionnaires used in the DBI. These data development activities are in general a boon for the
research community and society in general.
2.

Weaknesses of Composite Indexes

The main general criticism of composite indexes is their subjective nature. There are two
aspects to this. The first is the choice of indicators that go into a composite index. The second is
the weights used to aggregate the indicators into an overall index.
The value of a composite index and its trend over time are a function of what indicators
the index contains. Consequently, the domain, components, and indicators of a composite index
must be carefully and judiciously selected based on a balanced assessment of what the index istrying to measure. What goes into a composite index determines what comes out of the index.
The weighing of the components used to produce a composite index is crucial for the valueof the index. Indeed, for a given set of indicators, very different weighting schemes can produce
very different results. The simplest and least controversial way to proceed is to give equal weights
to all indicators. This appears the most neutral and balanced approach, even though in reality some81
indicators may be much more important than others. There are various methodologies that can beused to develop weights for composite indexes based on the importance of the indicators.
However, non-equal weights inevitably lead to debate on the merits of the weights, discussion that
often sheds more heat than light.
The World Bank has adopted an equal weights approach with the DBI. The result has beenthat the DBI has not been criticized for its weights.
B.

World Bank Evaluations of DBI

The World Bank has commissioned four evaluations of the DBI. The first by the WorldBank’s Independent Evaluation Group, was released in 2008. The second, Expert Panel headed by
Trevor Manuel was published in 2012. The third, in response to the Romer controversy, by two
external consultants was released in 2018. The four, in response to the August 2020 suspensionof the DBI, was conducted as a World Bank Group internal audit, was released in December 2020.
1.

World Bank’s Independent Evaluation Group DBI Evaluation

In 2008, the World Bank’s Independent Evaluation Group released the report “Taking the
Measure of the World Bank-IFC Doing Business Indicators.” It found that the indicators had beenhighly effective in drawing attention to the burdens of business regulation but could not bythemselves capture other key dimensions of a country’s business climate, the benefits ofregulation, or key related aspects of development effectiveness. The following quotation from thereport summarizes well the substance of the report.
“The Doing Business (DB) exercise is anchored in research that links characteristics of acountry’s business environment to firm performance, and thence to macroeconomic
outcomes. The regulatory framework— the part of the business environment that DB
measures— has been shown to be associated with firm performance, but its association
with macroeconomic outcomes is less clear. Many other factors affect macroeconomic
outcomes, and the direction of causality between regulation and economic outcomes is very
difficult to isolate. Since regulations generate social benefits as well as private costs, what
is good for an individual firm is not necessarily good for the economy or society as a whole.
Therefore, policy implications are not always clear-cut, and the right level and type of
regulation is a matter of policy choice in each country.
The DB exercise reflects the limitations inherent in the underlying research. As an exercise
in cross-country comparison, DB is not intended to, and cannot, capture country nuances.
Firms’ investment decisions also depend on variables not measured by the DB indicators,
such as the cost and access to finance and infrastructure, labor skills, and corruption.

82
Different aspects of regulation have varying degrees of economic importance depending
on countries’ income levels, legal regimes, and other characteristics. Seven of DB’s 10
indicators presume that lessening regulation is always desirable, whether a country starts
with a little or a lot of regulation. Reform as measured by the DB indicators typically means
reducing regulations and their burden, irrespective of their potential benefits.”
The report also noted that the DB indicators primarily measure laws and regulations as they
are written. But the relevance of each indicator in a given country depends on the extent to which
the law is actually applied, which DB does not aim to measure. Likewise, the pay-off from aparticular regulatory reform will depend on how significant a burden the regulation poses inpractice. These limitations underscore the need for DB to be interpreted cautiously and used inconjunction with complementary tools such as Investment Climate Assessments.
The report identified a number of weakness related to methodology and data reliability.
The DB collects its information from expert informants in each country, mostly lawyers, whoprovide information free of charge. This process can generate reliable data, but the report points
out that three areas of vulnerability need to be addressed.
The data are provided by few informants, with some data points for a country generated
by just one or two firms.



Although DB makes available a great deal of information about its data and methods, itremains insufficiently transparent about the number and types of informants for eachindicator, the adjustments its staff make to the data received from informants, and thechanges made to previously published data and their effects on the rankings. DB needs toadequately explain to users the possibilities for errors and biases.

DB makes much of its country rankings. The rankings have three weaknesses. First,
because most of the indicators presume that less regulation is better, it is difficult to tellwhether the top- ranked countries have good and efficient regulations or simply inadequate
regulation. Second, the small informant base makes it difficult to measure confidence inthe accuracy of the individual indicator values, and thus in the aggregate rankings. Third,changes in a country’s ranking depend importantly on where it sits in the distribution.



The DB indicators have motivated policy makers to discuss and consider businessregulation issues. As a cross-country benchmarking exercise, DB cannot be expected tocapture the country-specific considerations involved in prioritizing, sequencing, anddesigning policy reforms.

The report concludes a relatively positive note:

83“DB measures the costs but not the benefits of regulation. Despite its methodologicallimitations, it has contributed to development by providing countries with a basis forinternational comparisons of their regulatory regimes. It has helped to catalyze debatesand dialogue about investment climate issues in developing countries. For the Bank Group,
it is a key global knowledge product. Most of the methodological limitations can andshould be addressed promptly, lest they undermine its credibility. Inaccurate nomenclature
should be rectified, and the DB reports should not overstate claims of causality and theindicators’ explanatory power.”
As a caveat, the report noted that by prominently recognizing DB’s highly ranked
countries, the World Bank may inadvertently be signaling that it values reduced regulatory burdens
more than other development goals.
The evaluation appears not to have resulted in major changes in the DBI. Many of theconcerns identified in this evaluation were raised in the two later evaluations, suggesting that they
had not been addressed, or were addressed inadequately, or perhaps could not be addressed due tothe nature of the index.
2.

Independent Panel of Experts DBI Evaluation

In October 2012, the President of the World Bank Group appointed an independent panelof experts to review a broad range of issues about the Doing Business report. The panel was chairedby Trevor Manuel from South Africa and included as a member Huguette Labelle from Canada.
The panel reported in June 2013. Selected observations and recommendations from the report arepresented below.
The Panel shared the World Bank perspective that private-sector development is the key toeconomic growth and poverty reduction and that these goals could not be achieved without a strong
government to provide regulation, legislation, and infrastructure. The Panel found that the main
issue was whether the Doing Business Report measured the correct indicators, in the correct way.
Does a higher ranking imply that a country was on the right track for private-sector development?
One view that has been associated with DB is that minimal regulation and very low taxes create
the most attractive environment for business. The Panel noted that regulation is necessary toprotect societal and environmental interests, and taxes are necessary to provide public services andbuild infrastructure. The Doing Business project has, rightly or wrongly, been associated with abroad deregulation agenda. Indeed, some argue that seven of the 10 indicators imply that lessregulation is unambiguously better.
The Panel suggested that the Bank should continue publishing the Doing Business report,
but that its reliability and validity should be revisited. Challenges relating to the relevance of the

84
information gathered, the aspects being measured, the spectrum of businesses being analysed(currently only small and medium-sized enterprises), and the basis of its comparability acrosseconomies with different needs and at differing stages of development.
Specific concerns of the Panel included the following:

The Doing Business Report has the potential to be misinterpreted because it is not a onesize-fits-all template for development. Empirical evidence on the results of businessregulation reforms captured by the report is mixed and suggestive at best. Correlations
between the report’s topics and developmental outcomes often do point to a negative
association between the regulatory burden and economic development and growth.
However, such correlations do not justify a causal interpretation: it is notoriously difficult
to establish a causal relationship between such variables at the country level. Moreover,any correlation would only point to what is true “on average”. The evidence in favour of
specific country reforms is contingent on many auxiliary factors not captured by Doing
Business Report topics.



The Report relies on a narrow information source. It makes far-reaching observations
based on data gathered from sources with a relatively narrow perspective on the businessenvironment. The abiding question is whether the experts – primarily lawyers – are thebest source for the requisite primary data. A related consideration is whether the questions
posed are appropriate given what they are intended to measure.



The Report only measures regulations applicable to categories of business that can be
captured through its methodology. The representativeness of such businesses, and therelevance of these regulations, varies greatly from country to country. The report does notindicate how far its conclusions extend to firms outside its frame of reference.



The use of aggregate rankings is a contentious issue. Rankings are challenging because
they involve aggregating across indicators (topics) – a process that explicitly or implicitly
involves a value judgment of what is “better” for doing business and how much better it
is – and because small revisions or inaccuracies in primary data can significantly change
a country’s rankings.

The panel pointed out that the World Bank’s views on the objectives of economic growthand development, and the best way to attain these objectives, are continuously evolving. For
example, in its World Development Report 2013, the Bank puts forward a nuanced view on labour
regulations, suggesting that governments should strive for a balanced combination of labour
regulation and management practice that is unique to their country’s stage of development. Thismessage differs markedly from the perspective associated with DB reports.

85

The Panel made a number of recommendations, including:
1. Retain the Doing Business Report as an annual World Bank flagship report.
2. Remove the aggregate rankings table. The decision to retain or drop the aggregate rankings
table is the most important decision the Bank faces with regard to the Doing Business
report.26
3. Change the report’s title. This is one way the report can clarify its limitations and be moreclearly understood.
4. Implement a peer-review process. This would improve the report’s quality and provide amuch-needed safety net. The Panel recommends forming a single body with external
representation in this regard.
5. Increase the report’s level of transparency.
6. Align the report with the World Bank’s mandate and other flagship publications. Moving
the report team from the IFC to the Research Department would optimise use of the Bank’s
economic analysis and research capacity and help ensure that the message contained in thereport synchronises with the Bank’s other flagship products.
The World Bank accepted four of these six recommendations. It retained the DB, moved
the DB from the IFC to the Research Department, adopted an internal peer review process, andincreased the level of transparency by posting more documents on the World Bank website.
However, it did not drop the ranking table, nor change the title of the report.
3.

The Third World Bank Evaluation in Response to the Romer Controversy

In 2018, World Bank Chief Economist Paul Romer raised concerns about the validity of
the World Bank’s Doing Business indicators, suggesting that World Bank staff might havemanipulated the indicators for Chile (and other countries) for political reasons. The incident
resulted in Paul Romer leaving the World Bank.
In response to Romer’s criticism, the World Bank commissioned an audit on the integrity of the
DBI by Randall Morck and James Chenxing Shou from the University of Alberta (Morck andChou, 2018) They investigated the raw data and calculations of the Doing Business 2015, 2016
and 2017 indicators in 2015, 2016 and 2017 for Chile and twelve other economies. They
concluded:
26

Removing it would defuse many of the criticisms levelled against the report but would diminish the report’s
influence on policy and public discussion in the short term. In the long term, however, doing so may improve focus
on underlying substantive issues and enhance the report’s value. The scores (cardinal values) for each of theindicators should be emphasised. The country rankings (ordinal values) for each indicator could be maintained. Even
without the aggregate ranking, reform-minded countries would still be able to benefit from the primary datacollected in the report.

86“In every case we checked, the indicators are based on unaltered survey data, faithfully
entered into an automated data management system, and are mechanically constructed freeof manipulation by World Bank staff. The Ease of Doing Business indicators for Chile andfor the other economies we examined were not subject to manipulation by World Bank
staff.”
Morck and Chou did have a number of recommendations to improve the DBI methodology.
They pointed out that the survey questionnaires and how the indicators are calculated have changed
frequently. While these changes may have sound justification, they can result in abrupt changes incountry rankings thereby confusing users and reducing the value of the indicators. While
recognizing that there are difficult trade-offs between completeness, current relevance andcomparability over time, Morck and Chou suggested the World Bank minimize methodology
changes except to fix confirmed problems with existing methodology. They also suggested that
the World Bank add new indicators to cover additional aspects of the business environment, rather
than make methodological changes to existing indicators.
Morck and Chou conclude that:“Doing Business indicators are one of the World Bank’s most important contributions toresearch and public policy. Were the indicators unimportant, controversy about them would
not attract media attention. Rather, the World Bank’s success in credibly tracking
quantifiable improvements and backsliding in the ease of doing business in different
economies makes concerns about its methodology global news. That importance now also
encompasses the methodologies used to calculate the indicators. All this affirms thebroader success of the World Bank’s Doing Business initiative”.
4.
World Bank Group’s Internal Audit in response to the temporary
suspension of the DB Report in August 2020
On August 27, 2020 World Bank management announced reports of data irregularities inthe Doing Business 2018 report (published October 2017) and the Doing Business 2020 report(published in October 2019). The announcement called for a systematic review and assessment ofdata changes that occurred subsequent to the institutional data review process for the last five
Doing Business reports. Management also requested that the World Bank Group Internal Audit(GIA) perform an assurance review of data integrity in the production process of the Doing
Business Report and verify management’s review of data irregularities in the Doing Business
Reports from 2016 to 2020 (World Bank Group, 2020c).
The internal audit ordered by the World Bank in August of 2020 confirmed data
irregularities in four countries: China, Saudi Arabia, Azerbaijan, and the United Arab Emirates.
These irregularities led to a seven-place increase in ranking for China (ranked 78th prior tocorrections and 85th after in 2018), and a one place increase in ranking for Saudi Arabia (62nd87prior to corrections, 63rd after). Saudi Arabia’s status as a top improving economy was also
negatively affected. The irregularities did not affect the United Arab Emirates overall ranking andnegatively affected Azerbaijan’s rank by 6 places and excluded them from the list of top 10
improvers in the 2020 DB Report (World Bank Group, 2020d).
These irregularities were reported to senior management by Doing Business team members
and triggered the pause of the Doing Business report announced August 27, 2020 as well as thereview. The review process did not identify any further specific data irregularities beyond thoseaffecting the four countries mentioned above. These data irregularities occurred after the Doing
Business data had been circulated for Bank-wide Review just prior to finalizing the data for
publication (World Bank Group, 2020c).
The publication of the audit in December lifted the publication suspension implemented inAugust of 2020, with the publication of the Doing Business 2021 report scheduled for release in
March of 2021. While unrelated to the specific data irregularities, the Bank announced plans tolaunch an external review of the Doing Business methodology with the goal of strengthening the
product and its usefulness to stakeholders on December 16, 2020 (World Bank Group, 2020b).
Findings are expected mid-2021.
The audit concludes that the absence of a safe speak-up environment for the reporting ofmanagement override of controls has resulted in data irregularities. Additionally, the underlying
internal controls to safeguard the integrity of data throughout the production of the DB report are
insufficient.

The report highlights workplace environment concerns, stating that:“Pressure from stakeholders as part of the DB report production and publication
process has not been effectively managed. The DB team members reported undue
pressure, both directly and indirectly by Bank management to manipulate data in 2017
during the DB18 production process and in 2019 during the DB20 production process.
The lack of a safe speak-up environment within the DB team led to a fear of retaliation
for those who would escalate and report pressures to manipulate data. This contributed
to the compromise of data integrity in the DB report.
Out of the 15 staff in the DB team interviewed by GIA, 9 staff indicated that they had
been directly or indirectly pressured to manipulate data. Out of the 9 staff who reported
being pressured, 8 staff said they manipulated data. At the time, the DB team did not
escalate to DEC management and Bank Senior Management, and report pressuresencountered as part of the DB18 and DB20 report production to the internal
accountability mechanisms of the World Bank Group (WBG), due to fear of
retaliation. The DB team eventually reported the internal pressures to the internal

88accountability mechanisms of the WBG and to one of the DEC Directors during theDB21 production cycle.” (World Bank Group, 2020c:7)
The audit notes that the 8 staff who said they manipulated data reported 9 potential
data irregularities to DEC management in June of 2020, months after the August 2019
publication of the 2020 DB report. These 9 irregularities corresponded to the 9 out of 112
changes made after the data was circulated for BWR processes for the DB18, DB19 andDB20 reports and were all made without sufficiently documented rationale for change. The
report does assess that frequent personnel changes within DEC management and theabsence of defined roles and responsibilities resulted in ambiguity as to whom pressure tomanipulate data should be reported.
The audit also found that:“For DB20, the scoring method for the 'Protecting Minority Investors' (PMI)
indicator was changed by the then DEC Senior Director in late stages of the
production cycle even though the timing of the change did not conform withthe practice of advance consultation and dissemination of methodology
change. This change altered the scoring for this indicator and the overall
ranking of countries. The decision to change the scoring method was notshared with relevant stakeholders outside the DB team before the changes wereapplied.” (World Bank Group, 2020c, p. 7)
The report outlined two other significant concerns and one moderate concern in its overall
conclusion.
“Roles and Responsibilities: The definition of roles and responsibilities
for consultation, review, approval and clearance of the DB report
production and publication beyond the DB team is incomplete.
Although the DB team followed the established BWR process, the DB
reports were published in the past without fully defined roles andresponsibilities, thereby risking the integrity of the published data.
Significant.

Controls over Data Changes: The controls over data changes in the DB
Report production life cycle are not sufficient to preserve data integrity.
In addition, access control in DMS is not sufficiently designed to
enforce segregation of duties, which has led to some users having
excessive access, non-commensurate with their job responsibilities. As
a result, such controls might not detect and prevent compromises to data
integrity. Significant

89

Procedures and Guidance: Standards and processes to document theinherent judgments involved in the production of the DB Report and tosafeguard data integrity are not sufficiently defined to enableconsistency. As a result, decisions related to the production of the DB
report are sometimes open to judgement rather than being guided bydocumented procedures and guidance. Moderate” (World Bank Group,
2020c, p. 6)

The DEC management has started to address the issues identified in the report. For
instance, they have implemented annual ethics training sessions in collaboration with Ethics andBusiness Conduct (EBC) to explain the resources available to the DB team to report pressures in
the future. Additionally, a new director was appointed in November 2020 with an explicit mandate
to strengthen data integrity.
C.

Critiques of the DB Report from the academic and NGO community

A number of critiques from academics and the NGO community on the methodology andthe impacts of the DB Report are discussed below. This section is divided into four subsections:
methodological concerns, critiques of the political impact of the DBI, critiques of the DBI’s
usefulness as an international benchmarking tool and lastly critiques of the DBI as a driver orinternational development. The World Bank is not unaware of these critiques, and many werementioned either directly or indirectly in the World Bank’s internal and external evaluations of
the DBI.
1.

Methodological Concerns

Six methodological concerns were identified: first, the often-insufficient quality andquantity of the contributors consulted; second, the frequent methodological changes which lead toinconsistency in the rankings over time; third, the exclusion of several variables that are needed toprovide a more complete picture of a country’s business context; fourth, the DB assumption thatfewer regulations are implicitly better; fifth, the often significantly different results between firmlevel enterprise surveys and the DBI’s rankings; and, lastly, the inadequate representation ofbusiness reforms in certain countries because of the DBI’s one size fits all approach that ignores
local context.
The first critique is that too few experts are consulted to provide an accurate or credible
assessment of a country’s business climate. Holden and Pekmezovik (2020) found that the average
number of contributors per topic was approximately seven, and in smaller countries this number
was much lower. In addition, the quality of the contributors can be poor. The authors found that90
some of the experts consulted had insufficient knowledge of business reforms because theircountries had not undertaken them or were biased due to personal interests.
The second critique is that frequent methodological changes lead to inconsistency in the
ranking over time. The DB Index is ‘recalibrated’ each year in response to changes to themeasurement of its indicators and the introduction of new indicators intended to present a moreaccurate assessment of the business environment. This means that the changes in the ranking overtime are not necessarily due to reforms and may result from the World Bank’s methodological‘recalibration’. Therefore, the rankings are not always directly comparable year to year and closer
examination is required to determine the whether the changes in rankings over time are artificial
or reform based. For example, Sanderfer and Wadhwa (2018) from the Centre for Global
Development (CGD), an NGO focussed on reducing global poverty, closely examined the change
in India’s DBI ranking over time. They concluded that methodological changes rather than reforms
were responsible for the increase in India’s rankings from 142nd position to 100th between 2015
and 2018.
Swings in rankings for specific pillars can also be drastic. For example, South Africaranked first in the getting credit pillar in 2012 and 2013. However, in 2014, South Africa’s ranking
fell to 28th, followed by a drop to 50th in 2015. The 2020 report ranked South Africa 80th for thepillar. Swings of this magnitude bring into question the accuracy of the measurement of thecomponents of each pillar and thereby the credibility of the DB index as a whole (Lawder andWroughton, 2018).
Third, Holden and Pekmezovic (2020) underscored the omitted variable bias to therankings. The authors note that several factors like level of government corruption, gender
discrimination, competition policy, deficient infrastructure and level of foreign investor
protections are not included in the DBI.
Fourth, the DBI assumes that fewer regulations are implicitly better. Arrundaa (2008)
recognized that simplifying business formalisation and eliminating outdated formalities is often agood way of improving the institutional environment for firms. However, he argues that the WorldBank’s Doing Business project is harming such policies by promoting a reform agenda that
advocates for deregulation even in countries lacking functional business registers, so that thereformed registers keep producing valueless information, but faster. He argues its methodology
also promotes biased measurements that impede proper consideration of the essential trade-offs in
the design of formalisation institutions. The CGD similarly highlighted that the reports include thecosts of regulation but fail to include the benefits leading to an inaccurate representation of local
business contexts (Sandefer and Wadhwa, 2018).

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Fifth, a study undertaken by Hallward-Drienmeir and Pritchett (2015) discusses the vast
discrepancy between the findings of the DBI’s ranking and the results of the Firm-level Enterprise
Surveys produced by the World Bank. Much of this discrepancy can be attributed to the fact thatthe DBI’s indicators are based on de jure requirements rather than de facto business practice andtherefore do not accurately assess a countries business environment. The Bretton Woods Project(2017), a non-governmental organization working on trade and development issues with a criticalperspective on the World Bank and the IMF, echoed this complaint, identifying de facto regulatoryenvironments including tax avoidance schemes and legal requirements as exclusions that are
particularly significant to the business climate.
Lastly, the DB index sometimes fails to adequately capture business reforms because of its“one size fits all approach to doing business” that ignores the local context. For example, casestudies undertaken by Holden and Pekmezovic (2020) found that despite adopting businessreforms closely based on those of New Zealand, the DBI’s leader in the ‘starting a business’ pillar,
Pacific Island countries are not ranked comparably to New Zealand on the pillar. Additionally, acase study comparing similar reforms in Samoa and the Solomon Islands resulted in diametrically
opposite movements in the rankings. The case studies of reforms in Pacific Island countries doneby Holden and Pekmezovic (2020) find that the DBI fails to incorporate country specific reforms
into the DBI. However, due to the international nature of the ranking and therefore the necessityof a ones size fits all approach, incorporating country specific reforms is a virtually unachievable
objective. This close examination of Pacific nation states’ business reform additionally highlights
inaccuracies in the World Bank’s Doing Business country profiles which have mis-dated reforms
and failed to record relevant business reforms that have been implemented.
2.

Critiques of the political impact of the DBI

The DB Report is a flagship publication of the World Bank and some argue that the report
is used to influence the way countries implement changes to business climates. The report ispolitically motivated and promotes a free-market capitalist development strategy (Chang, 2013).
It is argued that the rankings have become a political tool which can be used to support or discredit
specific regimes (Sandefer and Wadhwa, 2018). The Centre for Global Development suggests that
the World Bank behaved irresponsibly by writing articles touting India’s jump in ranking in 2017,
despite being aware that the jump was almost exclusively due to their own methodologicalmanipulations. The DB rankings have been used in India as tools to promote Prime Minister
Modi’s government. Articles published in local press suggest that the World Bank had “endorsed
Modi’s reform credentials,” (Sandefer and Wadhwa, 2018). This support lent international
credibility to Modi. However, Indian civil society stressed that “reforms made under the ‘guidanceof DBR analysis have cause significant harm to vulnerable communities.” (Bretton Woods Project,2020).

92
While the rankings have been used to promote countries and governments, a fall in rankings
has also been used to discredit regimes, such as in Chile (Bretton Woods Project, 2020). Estaban
Silva from Chile’s Fundacion Constituyente XXI has been highly critical of the political nature of
the rankings, stating:“the publication of the DBR should cease… as we have no doubt that it will again
only be used to the benefit of those who seek to maintain and reproduce thecountry’s current neoliberal model and to halt the changes demanded by the vast
majority of citizens,” (Bretton Woods Project, 2020).
This argument is supported by former World Bank Chief Economist, Paul Romer, who
resigned over the integrity of the DB index in 2018, suggesting the rankings were politicallymotivated, and were intentionally discrediting Chile’s socialist president.

3.
Critiques of the Doing Business Index’s usefulness as an international
benchmarking tool
Broome, Homolar and Kranke (2018) make the case that benchmarking exercises byinternational organizations represent a significant source of indirect power in world politics. They
examine two prominent cases in which international organizations seek to shape the world throughcomparative metrics: (1) the World Bank Doing Business ranking; and (2) the OECD FDI
Regulatory Restrictiveness Index. They argue that the legitimacy attached to these benchmarks
because of the expertise of the international organizations that produce them is highly problematicfor two reasons. First, both benchmarks oversimplify the evaluation of relative national
performance, misrepresenting contested political values drawn from a specific transnational
paradigm as empirical facts. Second, the metrics entrench an arbitrary division in the international
arena between ‘ideal’ and ‘pathological’ types of national performance, which (re)produces social
hierarchies among states.
McCormack (2018) critically examined the role of law in promoting economic
development and argued that the most influential ‘law and development’ agenda—the World Bank
Doing Business (DB) project—is not fit for purpose and should be replaced. He argues that the
DB project and associated rankings embody a set of ideological and technical preferences whose
relationship with economic development is at best uncertain. Context and cultural sensitivity are
all important in the ‘real’ world and reducing complicated matters to a single ranking is notcompatible with bringing about genuine improvements in the legal framework for doing business.
Despite the above criticism, this international legitimization is highly influential becausewith increases in ranking comes increases in foreign direct investment. Anderson and Gonzalez

93(2012) found FDI flows are higher for economies with higher DBI ranking, even when otherfactors influencing FDI are factored in. A difference of 1 percentage point in regulatory quality
was found to be associated with a difference in annual FDI flows of US $250-500 million. They
argue that this relationship was in part causative as the laws, regulations and practices captured by
the DBI influence FDI flows. Corcoran and Gillanders (2015) also found that DBI rankings playa role in attracting FDI in middle-income countries, but not in OECD countries and sub-Saharancountries.
4.

Critiques of the DBI as driver of international development

The Bretton Woods Project has provided a trenchant critic of the DBI (Bretton Woods
Project, 2013, 2017, 2018, 2020). The Bretton Woods Project highlights negative consequences of
the DB Index. First, the organization suggests that the DB Index is failing small domestic
businesses (Bretton Woods Project, 2013). It argues that the DBI encouragement of tax reduction
and reduction of barriers to foreign investment is flawed. They argue that a major problem formany African countries is getting multinationals and larger companies to pay any tax at all. This
creates a situation where small local companies pay a higher tax rate than larger multinational
producing similar products, and leaves governments without resources to support the developmentof domestic small businesses. Second, the article is critical of the registering property pillar. They
argue that property rights are addressed inappropriately, as the pillar ‘registering property’
promotes formal titling and ease of title transfer. This in some cases facilitates land grabs whilst
undermining traditional community rights and access which are important for poor men andwomen’s livelihoods.
The Oakland Institute, a California-based policy think tank focussed on social, economic,
and environmental issues, is equally critical of the Ease of Doing Business Index from adevelopment perspective (2014, 2020). Their reports echo the Bretton Woods Project’s criticism
of the DBI because of its negative effects on low-income rural economies. They argue that the DB
Report is actively promoting deregulation, benefiting multinational corporate interests at theexpense of local citizens (Oakland Institute, 2014). The Oakland Institute’s report focuses on theeffects on the agricultural sector, finding that the DB rankings have the “collateral effect offacilitating land grabbing by advocating for ‘protection of investors’ and property reforms thatmake land a marketable commodity and facilitates large-scale land acquisitions.” (p. 4). It is thenargued that the DBI does not give adequate weight to its effects on local economies and that
advocating for a wholesale importation of “modern” land registration systems without
understanding and accommodating the complex systems that already exist leads to confusion,
tension and even conflict.
These concerns were reiterated by other sources. For example, following the suspension of
the DB Report in August of 2020, the Bretton Woods Project (2020) highlighted complaints from

94
civil society of the anti-tax, anti-labour and deregulatory biases of the DBI and its impact on the
wellbeing of citizens. In a 2018 article, the Bretton Woods Project underscores the stark contrast
between the Doing Business Index and other development indexes. Among these other indexes is
Oxfam’s Commitment to Reducing Inequality Index (CRI) which monitors efforts by countries toreduce the gap between rich and poor (Oxfam, 2020). The Bretton Woods project found that top
performing countries for the DBI’s paying taxes pillar, including Singapore, Bahrain, Latvia,
Lithuania, and Mauritius rank close to the bottom of the CRI’s tax pillar (2018). This comparison
highlights the fact that the DBI’s trust runs counter to efforts to reduce inequality and to addresssome of the pressing concerns in the 21st century, namely inequality, climate change and accessto health care.
Guild (2020) also voices ethical concerns in a piece entitled “Why the World Bank Torched
its Doing Business Ranking”. He criticizes the ranking for its libertarian bias suggesting that it
ignores “deeper structural, social or political issues – as well as the benefits of certain regulations.”(p. 2) He argues that the design of the rankings and the importance placed on the rankings in termsof receipt of foreign investment encourage countries to game the system rather than make realpolicy changes.
This concern was reiterated by the CGD who suggest that in their current form, rankings
create incentives for countries to not only manufacture cosmetic improvements but also forcountries to implement policies that conform with the World Banks vision for economic
development, regardless of what may or may not be in the best interest of citizens (Sandefer andWadhwa, 2018). This competition to game the ranking has even lead countries including China,
and Saudi Arabia to pressure World Bank officials to deliberately alter data, thereby increasing
their international rankings and generating positive international press at a time when leaders were
under widespread scrutiny over human rights abuses (Sandler, 2020).
In a press release following the World Bank’s suspension of the DB Index, Frederic
Mousseau, a policy director at the Oakland Institute was quoted as saying: “The Doing Business
Report drives an insidious race to the bottom where policy makers around the world are competingon being more attractive to private investors instead of protecting the environment and thewellbeing of their citizens,” (Oakland Institute, 2020)
The 280-organization strong Our Land Our Business campaign comprised of NGO’s,
unions, farmers and consumer groups from over 80 countries that calls for the end of the Doing
Business Report. This group unifies opposition to the DB Report and advocates for the permanentsuspension of the DB Report.
Overall, a review of the literature reveals numerous flaws in the DBI’s methodology andsignificant opposition to the DB report, even from within the World Bank.

95

D.

Assessment of the DBI Based on the Canadian Context

The DBI represents a massive global benchmarking exercise for best practices in business
operations. It covers 190 countries with input from more than 15,000 national experts. Only aninternational organization with the World Bank’s ample resources, expertise and credibility could
undertake such an ambitious project. Though its detailed questionnaires on business practices in
its ten pillars, the DBI has collected comprehensive and original information for over 15 years on
business practices in almost all countries of the world, allowing the identification of best and worse
practice. Countries can, and do, use this information to take action to improve their performance.
The DBI is far from perfect, as has been seen. But the World Bank should be congratulated
for taking the initiative to create the DBI in the early 2000s. One can criticize various aspects of
the DBI, but the world knowledge base on business practices has advanced considerably becauseof the DBI. This represents a major accomplishment.
The World Bank is well aware of the criticisms of the DBI, which are inevitable for any
project as ambitious and as ideologically charged as the DBI. It has commissioned four evaluations
to address perceived DBI shortcomings and has followed up on the some, but not all
recommendations made in the evaluations. Within the World Bank there have been different viewson the validity and usefulness of the DBI, as seen in the Paul Romer incident. Indeed, the futureof the DBI is uncertain given that in August 2020 the World Bank suspended the Doing Business
Report.
According to the August 27, 2020 World Bank press release:“A number of irregularities have been reported regarding changes to the data in the Doing Business2018 and Doing Business 2020 reports, published in October 2017 and 2019. The changes in thedata were inconsistent with the Doing Business methodology.
The integrity and impartiality of our data and analysis is paramount and so we are immediately
taking the following actions:

We are conducting a systematic review and assessment of data changes that occurred
subsequent to the institutional data review process for the last five Doing Business
reports.



We have asked the World Bank Group’s independent Internal Audit function to perform
an audit of the processes for data collection and review for Doing Business and thecontrols to safeguard data integrity.

We will act based on the findings and will retrospectively correct the data of countries thatwere most affected by the irregularities.”

96
It is possible that the DBI will be killed. But such a decision seems unlikely given its many
advocates, the resources that have been invested in the DBI, and its brand recognition andvisibility. More likely, methodological changes will be made to address the data irregularities andpossibly other criticisms.
The detailed analysis of the DBI in Canada earlier in this report revealed a number ofconcerns that are highlighted below.


There appear to be a number of data irregularities for the DBI indicators for Canada.
The most important was the massive increase in the cost of exporting and importing
between 2007 and 2009. Other indicators remained unchanged for long periods andthen inexplicably manifested an abrupt change. One would expect indicators would
have some year-to-year variation given that there is a changing set of experts whocomplete the questionnaires. In addition, one might expect most changes in practices
would be more gradual, unless a specific regulation is changed. When there aremajor changes in a pillar or an indicator one might expect greater discussion of thecauses in the DBI reports. For example, no explanation was provided for the massive
deterioration in Canada’s rankings for getting electricity and obtaining construction
permits.



The DBI weights all pillars and indicators equally. But they are not equal inimportance for the overall ease of doing business in Canada. An assessment of whatreally matters in terms of the DBI results for Canada would add great value to theproject.



The Toronto-centric focus of the DBI results for Canada is a concern. The results
may not apply outside Toronto because of differences in provincial and municipal
regulation. For example, Hydro Toronto takes a long time to make an electricity
connection and the City of Toronto Planning Authority appears slow in granting
construction permits. The poor performance on these two indicators alone drags
down Canada’s DBI ranking. One might expect that many other municipal
governments would do better on the two indicators.



The DBI includes both ordinal measures or rankings and cardinal measures orabsolute values for indicators and or scores. The focus of the DBI is on ranking, notabsolute changes in the indicators. This can lead to mixed signals. At times,
Canada’s ranking can decline when Canada is performing better in absolute termson the indicator. This is because other countries are improving at a faster rate than
Canada. Both changes in rankings and in the absolute value of indicators are
relevant. Rankings imply that the ease of doing business among countries is a zero-

97
sum game, with the improvement in the DBI ranking of one country offset by adeterioration in the ease of business in another country. In reality, the concept ofease of doing business is a positive sum gain since all countries can improve theirease of doing business in absolute terms.


The pool of experts that participate in the Doing Business survey for Canada isconfined to lawyers. Yet other professionals involved in business, including
accountants, engineers, economists and MBAs have knowledge of businesspractices and could answer the questionnaire from their perspectives, potentiallyenriching and improving the results.

VII. Conclusion and Recommendations
This report has provided a detailed analysis of the DBI for Canada, with a focus on thefour pillars in which Canada performs poorly, namely getting electricity, dealing with construction
permits, enforcing contracts, and trading across borders. The key conclusion of this study is thatthe DBI provides much insight on business regulation in Canada and represents a valuable
contribution to our knowledge of business practices.
The report was motivated by the observations that Canada’s current ranking on the DBI
at 23rd is below that of other well-known international competitiveness and economic environment
rankings and that, unlike the trend in these metrics, the DBI has fallen significantly in Canada from
4th in 2007. Canada appears not to do as well in the area of business regulations and practices asin broader economic indicators. This appears to explain the difference between the ranking of the
DBI and other indexes. Canada’s low ranking on the OECD product market regulation index,
which is similar to the DBI, appears to support this interpretation. The deterioration of Canada’s
ranking over the 2007-2020 period reflects much longer times needed to enforce contracts and toobtain building permits. If these trends can be confirmed from other sources, this is worrisome,although the actual damage done to overall business sector is unclear and needs to be quantified.
Overall, the benchmarking of Canadian performance related to the ease of doing business
relative to other countries is very informative. But some of the results appear strange and meritfurther investigation. The DBI results for Canada, at the national level, appear not always
meaningful. Indeed, the suspension of the DBI by the World Bank because of data irregularities inAugust 2020 supports this caution. The results of this investigation should be awaited before adefinitive assessment is given on the validity and reliability of the DBI. Even if there is a positive
assessment from the World Bank on the DBI, rankings should always be approached with caregiven the methodological and data complexities in this type of world-wide benchmarking exercise.

98
The DBI covers 190 countries or economies. Many of these economies perform very poorly
on the DBI and have little relevance for Canada. The World Bank categorizes the 190 countries inthe DBI into four groups based on the ease of doing business: very easy (1st to 53rd rankings),
easy (54th to 97th rankings), medium (98th to 147th ranking) and below average (148th to 190th
ranking). At 23rd Canada is in the very easy to do business group. This is the group that is most
relevant for Canada. It includes most OECD countries and all G7 countries except Italy. These are
Canada’s peer nations. Countries within this peer group that are especially relevant forbenchmarking purposes include the United States, by far our largest trading partner, and Australia,
often considered Canada’s twin given our common history as colonies of the UK and our similar
economic structures based on natural resources.
Based on the preceding analysis of the DBI, the report puts forward seven recommendations
related to the DBI that Global Affairs may wish to consider.


The DBI, and Canada’s performance on DBI pillars, receives considerable international
attention. Consequently, Global Affairs officials should closely monitor this performanceand be aware of the strengths and weaknesses or limitations of the DBI.



DBI pillars and indicators where Canada does well should be a source of pride to
Canadians. Global Affairs should consider making better known Canada’s performance inthese areas in its outreach to the international community. An excellent example isCanada’s stellar ranking on starting a business.



DBI pillars and indicators where Canada performs poorly can potentially have a negative
effect on Canada’s image abroad as a country with a favourable environment for doing
business. Global Affairs should conduct further investigation of the reasons for the poor
performance of the indicators that hurt Canada’s DBI ranking, as identified in this report.
In particular, is this poor performance a real phenomenon or a statistical artifact due to data
mis-measurement issues. This information can then be used to explain the performanceinternationally.

In cases where Canada’s poor performance on certain DBI pillars and indicators is real andrepresents an issue of national concern that cannot be justified by society’s overall interests,
Global Affairs should bring this weakness in the environment for doing business to theattention of the responsible government department or agency, pointing out the deleterious
effect on Canada’s international reputation. Examples of Canada’s derisory performance
include our 100th place on the enforcing contracts pillar and 124th place in getting
electricity.

99
Because of Canada’s federal system, DBI ranking for Canada based on regulatory
frameworks for Toronto and Ontario may not apply to other provinces or municipalities.
The availability of rankings for DBI pillars and indicators for all provinces and territories
would greatly increase our understanding of how the ease of doing business differs byjurisdiction in this country. Although such a benchmarking project is outside the ambit of
Global Affairs, the department could encourage others to undertake it, especially for DBI
pillars and indicators that appear problematic.

Many consider internal trade barriers a serious constraint on economic growth in Canada.
Yet the DBI includes no indicators on how the regulation of internal trade in this country
compares with that in other countries. Given the prominence of this issue, Global Affairs
might consider encouraging the World Bank to include information on internal trade
regulation in the DBI.



The expertise that the World Bank has developing in the benchmarking of country practices
related to the ease of doing business can be applied in other areas. For example, an
independent, authoritative benchmarking exercise on the ease of obtaining different typesof health services (e.g., wait times, cost, quality) would be relevant for both developed
countries such as Canada and for developing countries. Global Affairs could identify
subject areas where international benchmarking exercises would be useful and consult with
the World Bank on the possibility of developing such projects.

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VIII. References for Doing Business Report
Acemoglu, D., & Robinson, J. (2012). Why nations fail: The origins of power, prosperity andpoverty. New York: Crown Publishers.
Anderson, J., & Gonzalez, A. (2012). Does Doing Business matter for foreign direct
investment? In World Bank, Doing Business 2013: Smarter regulations for small andmedium‐size enterprises (pp. 47–50). Washington, DC: World Bank Group. Retrieved
from https://www.doingbusiness.org/en/reports/case-studies/2012/does-doing-businessmatter-for-foreign-direct-investment
Arruñada, B. 2009. “How Doing Business Jeopardises Institutional Reform.” European Business
Organization Law Review 10 (2009): 555-574.
Berg, Janine and Sandrine Cazes (2007) “The Doing Business Indicators: Measurement issues andPolitical Implications,” Economic and Labour Market Paper 2007.9, Economic and LabourMarket Analysis Department, International Labour Organization.
Besley, T. (2015). “Law, regulation, and the business climate: The nature and influence of theWorld Bank Doing Business project.” Journal of Economic Perspectives, 29(3), 99–120.
Retrieved from http://www.jstor.org/stable/43550123, https://doi.org/10.1257/jep.29.3.99
Bretton Woods Project (2013) “A bad business: Bank divisions on Doing Business revealed,”
October 3 https://www.brettonwoodsproject.org/2013/10/bad-business/
BrettonWoods Project (2017) “World Bank’s Doing Business Report,”
https://www.brettonwoodsproject.org/2017/07/world-banks-business-report/

July

3

Bretton Woods Project (2018) “Doing Business 2019: World Bank’s tunnel vision obscures calls
for reform,” December 6, https://www.brettonwoodsproject.org/2018/12/doing-business2019-world-banks-tunnel-vision-obscures-calls-for-reform/
Bretton Woods Project (2020) “As World Bank pauses Doing Busines Reports, pressure mounts
for
it
to
be
permanently
scrapped,”
October
6,
https://www.brettonwoodsproject.org/2020/10/as-world-bank-pauses-doing-businessreport-pressure-mounts-for-it-to-be-permanently-scrapped/
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106
Appendix 1: Doing Business Index by Country and by Pillar in 2020
EconomyGlobal Starting aRank Business

Dealing with
Construction
Permits

Getting
Electricity

Registering
Property

Getting
CreditProtecting
Minority
Investors

PayingTaxes

TradingacrossBorders

Enforcing
Contracts

Resolving
Insolvency

New Zealand

1

1

7

48

2

1

3

9

63

23

36

Singapore

2

4

5

19

21

37

3

7

47

1

27

Hong Kong SAR, China

3

5

1

3

51

37

7

2

29

31

45

Denmark

4

45

4

21

11

48

28

8

1

14

6

Korea, Rep.

5

33

12

2

40

67

25

21

36

2

11

United States

6

55

24

64

39

4

36

25

39

17

2

Georgia

7

2

21

42

5

15

7

14

45

12

64

United Kingdom

8

18

23

8

41

37

7

27

33

34

14

Norway

9

25

22

44

15

94

21

34

22

3

5

Sweden

10

39

31

10

9

80

28

31

18

39

17

Lithuania

11

34

10

15

4

48

37

18

19

7

89

Malaysia

12

126

2

4

33

37

2

80

49

35

40

Mauritius

13

20

8

28

23

67

18

5

72

20

28

Australia

14

7

11

62

42

4

57

28

106

6

20

Taiwan, China

15

21

6

9

20

104

21

39

61

11

23

United Arab Emirates

16

17

3

1

10

48

13

30

92

9

80

North Macedonia

17

78

15

68

48

25

12

37

32

47

30

Estonia

18

14

19

53

6

48

79

12

17

8

54

Latvia

19

26

56

61

25

15

45

16

28

15

55

Finland

20

31

42

24

34

80

61

10

37

45

1

Thailand

21

47

34

6

67

48

3

68

62

37

24

Germany

22

125

30

5

76

48

61

46

42

13

4

Canada

23

3

64

124

36

15

7

19

51

100

13

Ireland

24

23

36

47

60

48

13

4

52

91

19

Kazakhstan

25

22

37

67

24

25

7

64

105

4

42

107
EconomyGlobal Starting aRank Business

Dealing with
Construction
Permits

Getting
Electricity

Registering
Property

Getting
CreditProtecting
Minority
Investors

PayingTaxes

TradingacrossBorders

Enforcing
Contracts

Resolving
Insolvency

53

33

12

Iceland

26

64

72

16

16

94

28

42

Austria

27

127

49

29

31

94

37

44

1

10

22

Russian Federation

28

40

26

7

12

25

72

58

99

21

57

Japan

29

106

18

14

43

94

57

51

57

50

3

Spain

30

97

79

55

59

80

28

35

1

26

18

China

31

27

33

12

28

80

28

105

56

5

51

France

32

37

52

17

99

104

45

61

1

16

26

Turkey

33

77

53

41

27

37

21

26

44

24

120

Azerbaijan

34

9

59

80

44

1

105

40

83

28

47

Israel

35

28

35

83

75

48

18

13

67

85

29

Switzerland

36

81

71

13

18

67

105

20

26

57

49

Slovenia

37

41

119

23

54

119

18

45

1

112

8

Rwanda

38

35

81

59

3

4

114

38

88

32

62

Portugal

39

63

60

52

35

119

61

43

1

38

15

Poland

40

128

39

60

92

37

51

77

1

55

25

Czech Republic

41

134

157

11

32

48

61

53

1

103

16

Netherlands

42

24

88

58

30

119

79

22

1

78

7

Bahrain

43

67

17

72

17

94

51

1

77

59

60

Serbia

44

73

9

94

58

67

37

85

23

65

41

Slovak Republic

45

118

146

54

8

48

88

55

1

46

46

Belgium

46

48

45

108

139

67

45

63

1

56

9

Armenia

47

10

62

30

13

48

120

52

43

30

95

Moldova

48

13

156

84

22

48

45

33

38

62

67

Belarus

49

30

48

20

14

104

79

99

24

40

74

Montenegro

50

101

40

134

83

15

61

75

41

44

43

108

EconomyGlobal Starting aRank Business

Dealing with
Construction
Permits

Getting
Electricity

Registering
Property

Getting
CreditProtecting
Minority
Investors

PayingTaxes

TradingacrossBorders

Enforcing
Contracts

Resolving
Insolvency

Croatia

51

114

150

37

38

104

37

49

1

27

63

Hungary

52

87

108

125

29

37

97

56

1

25

66

Morocco

53

43

16

34

81

119

37

24

58

60

73

Cyprus

54

50

125

75

71

80

21

29

50

142

31

Romania

55

91

147

157

46

25

61

32

1

19

56

Kenya

56

129

105

70

134

4

1

94

117

89

50

Kosovo

57

12

160

90

37

15

128

48

31

53

48

Italy

58

98

97

38

26

119

51

128

1

122

21

Chile

59

57

41

39

63

94

51

86

73

54

53

Mexico

60

107

93

106

105

11

61

120

69

43

33

Bulgaria

61

113

43

151

66

67

25

97

21

42

61

Saudi Arabia

62

38

28

18

19

80

3

57

86

51

168

India

63

136

27

22

154

25

13

115

68

163

52

Ukraine

64

61

20

128

61

37

45

65

74

63

146

Puerto Rico

65

59

143

92

161

4

88

163

70

70

10

Brunei Darussalam

66

16

54

31

144

1

128

90

149

66

59

Colombia

67

95

89

82

62

11

13

148

133

177

32

Oman

68

32

47

35

52

144

88

11

64

69

97

Uzbekistan

69

8

132

36

72

67

37

69

152

22

100

Vietnam

70

115

25

27

64

25

97

109

104

68

122

Jamaica

71

6

70

120

85

15

61

124

136

119

34

Luxembourg

72

76

14

45

93

176

97

23

1

18

93

Indonesia

73

140

110

33

106

48

37

81

116

139

38

Costa Rica

74

144

78

25

49

15

110

66

80

111

137

Jordan

75

120

138

69

78

4

105

62

75

110

112

109

EconomyGlobal Starting aRank Business

Dealing with
Construction
Permits

Getting
Electricity

Registering
Property

Getting
CreditProtecting
Minority
Investors

PayingTaxes

TradingacrossBorders

Enforcing
Contracts

Resolving
Insolvency

Peru

76

133

65

88

55

37

45

121

102

83

90

Qatar

77

108

13

49

1

119

157

3

101

115

123

Tunisia

78

19

32

63

94

104

61

108

90

88

69

Greece

79

11

86

40

156

119

37

72

34

146

72

Kyrgyz Republic

80

42

90

143

7

15

128

117

89

134

78

Mongolia

81

100

29

152

50

25

25

71

143

75

150

Albania

82

53

166

107

98

48

111

123

25

120

39

Kuwait

83

82

68

66

45

119

51

6

162

74

115

South Africa

84

139

98

114

108

80

13

54

145

102

68

Zambia

85

117

67

129

149

4

72

17

155

130

79

Panama

86

51

100

51

87

25

88

176

59

141

113

Botswana

87

159

44

139

82

80

72

59

55

137

84

Malta

88

86

57

73

152

144

51

78

48

41

121

Bhutan

89

103

91

78

53

94

111

15

30

29

168

Bosnia and Herzegovina

90

184

173

74

96

67

88

141

27

93

37

El Salvador

91

148

168

87

79

25

140

70

46

126

92

San Marino

92

92

92

26

102

152

162

47

20

81

106

St. Lucia

93

69

38

56

107

165

79

84

93

79

131

Nepal

94

135

107

135

97

37

79

175

60

151

87

Philippines

95

171

85

32

120

132

72

95

113

152

65

Guatemala

96

99

118

46

89

15

153

104

82

176

157

Togo

97

15

127

99

56

48

120

174

131

140

88

Samoa

98

46

94

71

68

119

128

82

154

86

140

Sri Lanka

99

85

66

89

138

132

28

142

96

164

94

Seychelles

100

147

106

104

65

144

143

36

98

128

75

110

EconomyGlobal Starting aRank Business

Dealing with
Construction
Permits

Getting
Electricity

Registering
Property

Getting
CreditProtecting
Minority
Investors

PayingTaxes

TradingacrossBorders

Enforcing
Contracts

Resolving
Insolvency

Uruguay

101

66

151

65

119

80

153

103

150

104

70

Fiji

102

163

102

97

57

165

97

101

79

101

98

Tonga

103

62

69

95

166

48

153

102

97

98

138

Namibia

104

165

84

76

173

80

88

88

138

64

127

Trinidad and Tobago

105

79

126

43

158

67

57

160

134

174

83

Tajikistan

106

36

137

163

77

11

128

139

141

76

153

Vanuatu

107

137

163

101

84

37

147

67

148

138

101

Pakistan

108

72

112

123

151

119

28

161

111

156

58

Malawi

109

153

128

171

90

11

79

135

127

149

134

Côte d'Ivoire

110

29

152

141

112

48

120

114

163

94

85

Dominica

111

71

83

57

179

152

79

83

91

95

136

Djibouti

112

123

87

121

117

132

103

133

147

144

44

Antigua and Barbuda

113

130

117

50

124

165

79

145

112

36

132

Egypt, Arab Rep.

114

90

74

77

130

67

57

156

171

166

104

Dominican Republic

115

112

80

116

74

119

143

150

66

133

124

Uganda

116

169

113

168

135

80

88

92

121

77

99

West Bank and Gaza

117

173

148

86

91

25

114

112

54

123

168

Ghana

118

116

104

79

111

80

72

152

158

117

161

Bahamas, The

119

94

77

81

181

152

88

50

161

82

71

Papua New Guinea

120

142

122

118

127

48

72

118

125

173

144

Eswatini

121

155

96

132

104

94

162

73

35

172

117

Lesotho

122

84

165

158

114

94

147

110

40

99

126

Senegal

123

60

131

119

116

67

114

166

142

132

96

Brazil

124

138

170

98

133

104

61

184

108

58

77

Paraguay

125

160

75

109

80

132

143

126

128

72

105

111

Economy

Dealing with
Global Starting aConstruction
Rank Business
Permits

Getting
Electricity

Registering
Property

Getting
CreditProtecting
Minority
Investors

PayingTaxes

TradingacrossBorders

Enforcing
Contracts

Resolving
Insolvency

Argentina

126

141

155

111

123

104

61

170

119

97

111

Iran, Islamic Rep.

127

178

73

113

70

104

128

144

123

90

133

Barbados

128

102

153

117

118

152

136

96

132

170

35

Ecuador

129

177

114

100

73

119

114

147

103

96

160

St. Vincent and the Grenadines

130

93

51

105

168

165

79

100

81

61

168

Nigeria

131

105

55

169

183

15

28

159

179

73

148

Niger

132

56

180

159

115

48

120

169

126

114

114

Honduras

133

170

158

138

101

25

120

167

130

154

143

Guyana

134

111

167

170

128

94

88

122

151

92

163

Belize

135

166

123

91

137

173

157

60

114

135

91

Solomon Islands

136

110

172

112

155

104

136

41

160

157

145

Cabo Verde

137

121

50

154

69

144

170

87

109

52

168

Mozambique

138

176

61

103

136

165

147

127

94

168

86

St. Kitts and Nevis

139

109

58

110

185

165

103

125

71

49

168

Zimbabwe

140

167

140

167

109

67

97

146

159

169

142

Tanzania

141

162

149

85

146

67

105

165

182

71

116

Nicaragua

142

145

176

115

160

104

170

162

84

87

107

Lebanon

143

151

164

127

110

132

114

116

153

131

151

Cambodia

144

187

178

146

129

25

128

138

118

182

82

Palau

145

132

129

153

47

104

188

113

139

125

166

Grenada

146

89

130

93

147

152

105

143

137

80

168

Maldives

147

74

63

149

176

144

147

119

157

124

141

Mali

148

124

133

161

140

152

120

173

95

159

102

Benin

149

65

82

178

126

152

120

171

110

162

108

Bolivia

150

175

139

96

148

144

136

186

100

109

103

112

EconomyGlobal Starting aRank Business

Dealing with
Construction
Permits

Getting
Electricity

Registering
Property

Getting
CreditProtecting
Minority
Investors

PayingTaxes

TradingacrossBorders

Enforcing
Contracts

Resolving
Insolvency

Burkina Faso

151

88

95

183

141

152

120

154

122

165

109

Mauritania

152

49

109

166

103

132

147

177

144

48

168

Marshall Islands

153

83

76

140

187

104

179

79

76

106

167

Lao PDR

154

181

99

144

88

80

179

157

78

161

168

Gambia, The

155

119

145

165

143

152

170

172

115

129

128

Guinea

156

122

116

150

122

152

162

183

167

118

118

Algeria

157

152

121

102

165

181

179

158

172

113

81

Micronesia, Fed. Sts.

158

174

136

122

187

104

185

111

65

184

125

Ethiopia

159

168

142

137

142

176

189

132

156

67

149

Comoros

160

158

101

136

113

132

162

168

120

179

168

Madagascar

161

80

182

186

164

132

140

134

140

136

135

Suriname

162

182

115

145

157

181

157

107

87

188

139

Sierra Leone

163

58

181

181

169

165

128

93

165

108

162

Kiribati

164

149

169

172

150

173

136

98

135

121

168

Myanmar

165

70

46

148

125

181

176

129

168

187

164

Burundi

166

44

161

184

100

176

143

140

169

158

147

Cameroon

167

104

154

133

175

80

157

181

186

167

129

Bangladesh

168

131

135

176

184

119

72

151

176

189

154

Gabon

169

96

141

164

171

132

170

182

170

180

130

São Tomé and Príncipe

170

150

111

130

172

165

179

137

124

185

168

Sudan

171

157

124

162

95

176

153

164

185

148

152

Iraq

172

154

103

131

121

186

111

131

181

147

168

Afghanistan

173

52

183

173

186

104

140

178

177

181

76

Guinea-Bissau

174

161

177

182

132

152

114

155

146

171

168

Liberia

175

75

185

175

180

104

176

76

184

175

110

113

EconomyGlobal Starting aRank Business

Dealing with
Construction
Permits

Getting
Electricity

Registering
Property

Getting
CreditProtecting
Minority
Investors

PayingTaxes

TradingacrossBorders

Enforcing
Contracts

Resolving
Insolvency

Syrian Arab Republic

176

143

186

160

162

176

97

91

178

160

158

Angola

177

146

120

156

167

185

147

106

174

186

168

Equatorial Guinea

178

183

162

155

163

132

162

179

175

105

168

Haiti

179

189

179

147

182

144

183

149

85

127

168

Congo, Rep.

180

179

134

179

174

132

162

185

183

155

119

Timor-Leste

181

68

159

126

187

173

157

136

107

190

168

Chad

182

186

174

180

131

152

170

188

173

153

155

Congo, Dem. Rep.

183

54

144

177

159

152

176

180

187

178

168

Central African Republic

184

180

184

185

170

144

162

187

164

183

155

South Sudan

185

172

171

187

177

181

185

74

180

84

168

Libya

186

164

186

142

187

186

183

130

129

145

168

Yemen, Rep.

187

156

186

187

86

186

162

89

188

143

159

Venezuela, RB

188

190

175

174

145

132

170

189

188

150

165

Eritrea

189

185

186

187

178

186

185

153

188

107

168

Somalia

190

188

186

187

153

186

190

190

166

116

168

Guinea-Bissau

174

161

177

182

132

152

114

155

146

171

168

Liberia

175

75

185

175

180

104

176

76

184

175

110

Source: https://www.doingbusiness.org/en/rankings
Nota bene: The rankings may be misleading because they are ordinal measures and so it is not possible to ascertain the magnitude of theunderlying difference across rank values. For example, a country that is ranked 100th in a pillar might not have a significant difference in theunderlying data versus a country that is ranked 1st if, say, there are 99 countries with a score of 100 on the pillar and the 100th country has ascore of 99. In this case the first 99 countries with a score of 100 are all ranked number 1, while the 100th country with a score just marginallybelow the pack is ranked 100th.

114
Appendix 2: List of Index Indicators in 2020 Index
Starting a business

Procedures - (#)
Time - (days)
Cost - (% of income/ capita)
minimum capital required (% of income/capita)
Dealing with construction permits
Procedures (#)
Time (days)
Cost- (% of warehouse value)*Building quality control index- (0-15)
Getting electricity
Procedures (#)
Time (days)
Cost- (% of income/ capita)*Reliability of supply & transparency of tariff index (0-8)
Registering property
Procedures (#)
Time (days)
Cost- (% of property value)*Quality of the land administration index (0-30)
Getting credit*Strength of legal rights index- (0-12)*Depth of credit info index (0-8)
Public Registry coverage (% of Adults)
Credit Bureau Coverage (% of adults)
Private Bureau Coverage (% of adults)
Protecting minority investors*Extent of disclosure index (0-10)*Extent of director liability index (0-10)*Ease of shareholder lawsuits index (0-10)*Extent of share-holder rights index (0-6)*Extent of ownership & control index (0-7)*Extent of corporate transparency index (0-7)
Paying taxes
Payments (#/yr)
Time (hrs/yr)
Total tax & contribution rate (% of profit)*Post filing index (0-100)
Trading across borders
Time to export: Border compliance (hrs)
Cost to export: Border compliance ($)
Time to export: Documentary compliance (hrs)
Cost to export: Documentary compliance ($)
Time to import: Border compliance (hrs)
Cost to import: Border compliance ($)
Time to import: Documentary compliance (hrs)
Cost to import: Documentary compliance ($)
Enforcing contracts
Time (days)
Cost (% of claim value)*Quality of judicial processes index (0-18)
Resolving insolvency
Time in Years
Cost (% of estate)
Recovery rate (cents/$)*Strength of insolvency framework index (0-16)
Outcome (0 as piecemeal sale and 1 as going concern)
Source: DB report 2020, https://www.doingbusiness.org/en/reports/global-reports/doing-business-2020* Denotes composite indicators (comprised of underlying components)

115

Appendix 3: Ranking of Six Pillars of the Doing Business Index 2007-2020
Panel A: Starting a Business
0
1

Ranking

1

2

2

2

2

3

2

3

3

3

2011

2012

2013

2

2

2

3

3

3

2019

2020

4
2007

2008

2009

2010

2014

2015

2016

2017

2018

Year

Panel B: Employing Workers (until 2010)

Ranking

0
2
4
6
8
10
12
14

13

16
18
20

18

19
2007

2008

Year

2009

17

2010

116
Panel C: Registering Property
0
10

Ranking

20

22
28

32

30

35

37

41

40
50

54

55

55

2013

2014

2015

33

34

2019

42

43

2016

2017

2018

12

12

36

60
2007

2008

2009

2010

2011

2012

Year

Panel D: Getting Credit
0
5

7

7

7

7

7

Ranking

10

15

15
20

24

25

28

30

30

23
28

32

35
2007

2008

2009

2010

2011

2012

2013

2014

Year

2015

2016

2017

2018

2019

2020

2020

117
Panel E: Protecting Investors (until 2014), Protecting Minority Investors (since 2015)
02

Ranking

4

4
5

5

5

5

5

4

5
6

6

7

7

7
8

8
10

11

12
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Year

Panel F: Paying Taxes
0510

Ranking

10

8

8

8

9

9

15
20

17

16
19

19

2019

2020

22
25

25

28

28

2009

2010

30
2007

2008

2011

2012

2013

2014

Year

2015

2016

2017

2018

118

Panel G: Resolving Insolvency (closing a business until 2010)
0
2
4

5

4

4

4

5

5

4
6

Ranking

6
9

8

11

10
12
14

16

16

13

13

2019

2020

15

18
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Year

Source: https://www.doingbusiness.org/en/reports/global-reports/doing-business-2020

119

Appendix 4: Canada’s Ranking on Six Pillars of the Doing Business Index and the Absolute Value and Ranking of Pillar Indicators
2007-2020
Panel A: Starting a Business
Rank
Procedures(number)
Procedures
rankingTime (days)
Time ranking
Cost (% ofincome percapita)Cost Ranking
Minimum
capital (% ofincome percapita)Minimum
Ranking

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

1

2

2

2

3

3

3

2

2

3

2

2

3

3

2

2

1

1

1

1

1

1

1

2

2

2

2

2

1

2

3
2

3

5

5

5

5

5

5

5

1.5

1.5

1.5

1.5

1.5
3

0.9

0.9

0.5

0.4

0.4

0.4

0.4

0.4

0.4

0.4

0.4

0.4

0.3

0.3

9
0

9
0

0

1

Source: The World Bank Reports, CSLS calculations

0

0

0

0

0

0

0

0.0

0.0

0.0

0.0
1

120
Panel B: Registering Property
Rank
Procedures (number)
Procedures Ranking
Time (days)
Time
Ranking
Cost (% of property
value)
Cost ranking

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

22
6
70
10

28
6

32
6

35
6

37
6

41
6

54
6

55
6

55
6

43
6

33
5

34
5

17

17

17

17

17

17

16.5

16.5

42
6
84
16.5

16.5

4

4

36
5
51
4

20
1.7

46
1.8

1.8

1.8

1.8

24

Quality of land
administration index(0-30)
Quality of land
administration index
Ranking
Source: The World Bank Reports and CSLS calculations.

1.8

3.4

3.4

3.3

3.3

12
3.1

2.9

2.9

61
N/A

21.5
38

3.8
70

21.5

21.5

21.5

21.5
49

121
Panel C: Protecting Investors
Rank
Extent of disclosure Index(0-10)
Extent of disclosure Index
Ranking
Extent of director liability
Index (0-10)
Extent of director liability
Index Ranking
Ease of Shareholder suits
Index (0-10)
Ease of Shareholder suits
Index
Ranking
Strength of Investor
protection Index (0-10)
Strength of Investor
protection Index Ranking

2007
5
8

Protecting Investors
2008
2009
2010
5
5
5
8

8

8

2011
5

2012
5

2013
4

2014
4

8

8

8

8

2015
7

Protecting Minority Investors
2016
2017
2018
2019
6
7
8
11
8

5
9

9

9

9

9

9

9

9

9

8

8

8

8

8

9

9

9

9

9

8.3

8.3

8.3

5

Extent of shareholder rights
index: (0-10) in and before
2019 and (0-6) in 2020
Extent of shareholder rights
index: Ranking
Extent of ownership andcontrol index (0-10) up to2019 and (0-7) in 2020
Extent of ownership andcontrol index Ranking
Extent of corporatetransparency index (0-10) inand before 2019 and (0-7) in
2020
Extent of corporatetransparency index Ranking
Source: The World Bank Reports and CSLS calculations.

8.3

8.7

8.7

9
31

9

9

1
8.3

8
7

23

14
8.3

8

7

13
8

8

2020
7

9
2

N/A

Note: 2015-2016
Methodology is
not comparable

N/A

N/A

6

N/A

71

N/A

8

N/A

5

N/A

6

N/A

55

6

6

4
65

7

7

6
10

8

8

6

14

122
Protecting Minority Investors 2015-2017
Rank
Extent of conflict-of-interest regulation index (0-10)
Extent of conflict-of-interest regulation index - Ranking
Extent of shareholder governance index (0-10)
Extent of shareholder governance index - Ranking
Strength of minority investor protection index (0-10)
Strength of minority investor protection index - Ranking
Source: The World Bank Reports, CSLS calculations.
Note: 2015-2016 methodology is not comparable to other years

2015
7
8.7
4
5.8
50
7.3
6

2016
6
8.7
4
6.7
29
7.7
6

123
Panel E: Getting Credit
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Rank

7

7

28

30

32

24

23

28

7

7

7

12

12

15

Strength of legal rights Index (0-10)
Strength of legal rights Index
ranking

7

7

6

6

6

7

7

7

N/A

51

N/A
9

9

9

18

Strength of legal rights Index (0-12)
Strength of legal rights Index
ranking
Depth of credit information Index(0-6)
Depth of credit information Index
ranking
Depth of credit information Index
(0-8)

6

6

6

Private bureau coverage (% ofadults)Private bureau coverage ranking
Credit registry coverage (% ofadults)Credit registry coverage ranking

9

N/A

18

6

6

6

6

1

Depth of credit information Index
ranking
Public registry coverage (% ofadults)Public registry coverage ranking
Credit bureau coverage (%of adults)
Credit bureau coverage ranking

N/A

0

0

0

1

N/A

N/A

1
0

0

78

8

8

100

100

100

1

Source: The World Bank Reports and CSLS calculations.

100
1
0

100

8

8

N/A

90

100

8

1

0

N/A
N/A
100

28
N/A

8

0

9

6

N/A

0

9

100

100

N/A
100

100

N/A

1

N/A

N/A

0

N/A

90

0

0

0

100

100
1

0

0
93

124
Panel F: Paying taxes
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Rank
22
25
28
28
Payments(number per
10
9
9
9
year)
Payments
15
rankingTime (hours per
119
119
119
119
year)
Time ranking
31
Total tax rate (%
43
45.9
45.4
43.6
of profit)
Total tax rate
77
ranking
Post filing Index(0-100)
Post filing Index
ranking
Source: The World Bank Reports and CSLS calculations.

10

8

8

8

9

9

17

16

19

19

8

8

8

8

8

8

8

8

8

8

23
131

131

131

131

131

131

131

27
131

131

37
29.2

28.8

26.9

24.3

21

21.1

21.0

42
20.9

20.5

21
N/A

76.4

N/A

76

131
24.5
30

73.2

73.2

73.2
74

125
Panel G: Closing a Business (Called Resolving Insolvency starting with 2012)
2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Rank

5

4

4

4

3

3

3

9

6

16

15

11

13

13

Time (years)

0.8

0.8

0.8

0.8

0.8

0.8

0.8

0.8

0.8

0.8

0.8

0.8

0.8

0.8

Time ranking

3

Cost (% of estate)

4

Cost ranking

7

Recovery rate (centson the dollar)

89.3

Recovery rate
ranking

7

3
4

4

4

4

4

4

7

7

7

7

7

7

7
20

88.8

88.7

88.7

91.2

90.7

90.7

87.3

87.3

N/A

13.5

Strength ofinsolvency
framework index
rankings

N/A

13

Outcome rankings

Source: The World Bank Reports and CSLS calculations.

87.4

87.5

87.5

86.7
20

Strength ofinsolvency
framework index (016)

Outcome (0 aspiecemeal sale and 1
as going concern)

87.3

11

11

11

11

11

55

N/A

1

N/A

1

126
Appendix 5: Scores for the Doing Business Index and its Pillars in Canada, 2015-2020
2015

2016

2017

2018

2019

2020

ScoresOverall
Starting a Business
Dealing with Construction
Permits
Getting electricity
Registering Property
Getting Credit
Protecting Minority Investors
Paying Taxes
Trading across Borders
Enforcing Contracts
Resolving Insolvency

79.09
98.82

80.07
98.23

78.57
98.23

79.29
98.23

79.26
98.23

79.60
98.20

67.12

73.70

73.66

72.87

72.98

73.00

59.27
76.2
85.00
72.5
93.00
86.07
63.76
89.17

63.76
75.09
85.00
76.67
93.00
88.36
65.49
81.36

63.76
75.40
85.00
76.67
88.86
88.36
54.35
81.43

66.89
79.31
85.00
78.33
88.05
88.36
54.35
81.46

63.78
79.31
85.00
78.33
88.05
88.36
57.13
81.46

63.80
77.80
85.00
84.00
88.10
88.40
57.10
81.00

Source: https://www.doingbusiness.org/en/reports/global-reports/doing-business-2020

127
Appendix 6: Ranking and Scores of Select Indicators, by pillar
Table 1: Trading Across Borders
Panel A: Cost to Export: Border Compliance (USD), 2020
Country

Cost

Cost

0
0

Ranking1
1Country

Austria
Belgium

BurundiGeorgia

109
112

Ranking
39
40

Country

Cost
278
279

Ranking
77
78

280

42
43
44
45

Uzbekistan
Oman
Central African
Republic
United Kingdom
Zimbabwe
Pakistan
Chile

Croatia0

1

Switzerland

115

41

Czech Republic
Denmark
Estonia
FranceHong Kong SAR,
China

0
0
0
0

1
1
1
1

NorwayEl Salvador
JordanEswatini

125
128
131
134

0

1

Lao PDR

140

Country

Cost

Cost

382
386

Ranking
115
116

Country

Qatar
Puerto Rico

Colombia
Peru

630
630

Ranking
153
153

280
285
288
290

79

Niger

391

117

Solomon Islands

630

153

79
81
82
83

MexicoBangladesh
Iran, Islamic Rep.
Kiribati

400
408
415
420

118
119
120
121

Cabo Verde
Comoros
KuwaitPapua New Guinea

641
651
665
700

156
157
158
159

46

Vietnam

290

83

Côte d'Ivoire

423

122

Vanuatu

709

160

426

123

Belize

710

161

432
450
453
456

124
125
126
127

St. Lucia
Namibia
Mauritania
Equatorial Guinea

718
745
749
760

162
163
164
165

462

128

South Sudan

763

166

Hungary

0

1

Kenya

143

47

Marshall Islands

298

85

Italy
Luxembourg
Netherlands
Poland

0
0
0
0

1
1
1
1

Argentina
IsraelLatviaLesotho

150
150
150
150

48
48
48
48

CyprusGreeceMauritius
Ireland

300
300
303
305

86
86
88
89

Portugal

01

Morocco156

52

Guatemala

310

90

Romania

0

1

Togo

163

53

Tajikistan

313

91

San Marino
Slovak Republic
Slovenia
Spain

0
0
0
0

1
1
1
1

Canada167

54

Micronesia, Fed. Sts.
Ethiopia
United States

168
172
175

55
56
57

Botswana
Fiji
Chad
Saudi Arabia

317
317
319
319

92
92
94
94

Kyrgyz Republic

10

20

Rwanda183

58

Seychelles

332

96

BahrainSerbiaWest Bank andGaza
Albania
Bulgaria

47
47

21
21

Korea, Rep.
Tonga

185
201

59
60

Singapore
St. Kitts and Nevis

335
335

97
97

SwedenLithuania

51

23

Uganda209

61

Taiwan, China

335

97

55
55

24
24

Indonesia
India

211
212

62
63

New ZealandTurkey

337
338

100
101

55

24

Finland213

64

Brunei Darussalam

340

102

64

St. Vincent and the
Grenadines

340

102

58

27

Malaysia213

São Tomé and
Príncipe
MyanmarCosta Rica
Afghanistan
Philippines
United ArabEmirates
Guyana468

129

Australia

766

167

Suriname
Kazakhstan
Lebanon
Barbados
Dominican
Republic
Ghana
Somalia
Trinidad andTobagoPalau
Bahamas, The
Antigua andBarbuda

468
470
480
486

129
131
132
133

GuineaNigeriaParaguay
Angola

778
786
815
825

168
169
170
171

Senegal488

134

Brazil

862

172

490
495

135
136

Madagascar
Jamaica

868
876

173
174

499

137

Sudan

967

175

505
512

138
139

Cameroon
Grenada

983
1034

176
177

546

140

Uruguay

1038

178

547

141

Liberia

1113

179

Bhutan59

28

Azerbaijan

214

66

Germany345

104

Sierra Leone

552

142

Belarus
Bolivia
Bosnia andHerzegovina
UkraineMoldova
Montenegro
Armenia
Nepal
North Macedonia
Kosovo

65
65

29
29

ThailandMongolia

223
225

67
68

Timor-Leste
Benin

350
354

105
106

Ecuador
Libya

560
575

143
144

Syrian Arab
Republic
Iraq
Tanzania

70

31

Nicaragua

240

69

Iceland365

107

Russian Federation

580

145

South Africa

1257

183

75
76
85
100
103
103
105

32
33
34
35
36
36
38

Mali
Malawi
China
Egypt, Arab Rep.
Burkina Faso
Panama
Japan

242
243
256
258
261
270
272

70
71
72
73
74
75
76

Sri Lanka
Haiti
Malta
ZambiaCambodia
Tunisia
Gambia, The

366
368
370
370
375
375
381

108
109
110
110
112
112
114

Guinea-Bissau
Algeria
Maldives
Honduras
Mozambique
Djibouti
Dominica

585
593
596
601
602
605
625

146
147
148
149
150
151
152

Samoa
Gabon
Congo, Rep.
Congo, Dem. Rep.
Eritrea
Venezuela, RB
Yemen, Rep.

1400
1633
1975
2223
-9999
-9999
-9999

184
185
186
187
N/A
N/A
N/A

Source: CSLS Calculations, based on the World Bank Report.

1113

179

1118
1175

181
182

128
Panel B: Cost to import: Border Compliance (USD), 2020
Country
Armenia
Austria
Belarus

Cost
0
0
0

Ranking1
1
1Country
Switzerland
Ethiopia
Norway

Cost
115
120
125

Ranking
39
40
41

Cost
300
306
307

Ranking
76
78
79

Country

Cost

Cost

490
499
500

Ranking
115
116
117

Country

PanamaKyrgyz Republic
Costa Rica

SenegalCentral African Republic
Solomon Islands

702
709
740

Ranking
153
154
155

311

80

Paraguay

500

117

Afghanistan

750

156

42
44
45

Country
Sri Lanka
Montenegro
Israel
St. Kitts andNevis
BoliviaJapan
Korea, Rep.

Belgium

01

El Salvador

128

42

Bulgaria
Croatia
Czech Republic

0
0
0

1
1
1

KosovoEswatini
Malawi

128
134
143

315
315
315

81
81
81

Uruguay
Russian Federation

500
520

117
120

Australia

539

121

Comoros
South Sudan
Lebanon

765
781
790

157
158
159

Denmark

0

1

Namibia

145

46

Fiji

320

84

540

122

Guinea809

160

Estonia
FinlandFranceGermany

0
0
0
0

1
1
1
1

LesothoNorth Macedonia

150
150

47
47

326
330
335
340

85
86
87
88

545
545
546
550

123
123
125
126

Sierra Leone
Syrian Arab Republic
Kenya
St. Lucia

821
828
833
842

161
162
163
164

St. Vincent and the
Grenadines
Colombia
Mali
Antigua and Barbuda
Guinea-Bissau

Canada

172

49

175

50

Gambia, The
Tonga
CyprusTaiwan, China

180

51

Seychelles

341

89

Ghana

553

127

Bangladesh

900

165

190
206
210
213
220
223
224
228

52
53
54
55
56
57
58
59

365
367
372
373
375
380
383
386

90
91
92
93
94
95
96
97

United Arab Emirates
Egypt, Arab Rep.
Qatar
Zimbabwe
Haiti
Dominican Republic
Mauritania
Cabo Verde

553
554
558
562
563
579
580
588

127
129
130
131
132
133
134
135

Samoa
Dominica
Jamaica
Papua New Guinea
Somalia
Chad
Maldives
Equatorial Guinea

900
906
906
940
952
965
981
985

165
167
167
169
170
171
172
173

395

98

Madagascar

595

136

Liberia

1013

174

396
397
399
400
405

99
100
101
102
103

Tunisia
Benin
Palau
Togo
Kuwait

596
599
605
612
634

137
138
139
140
141

AngolaDjibouti
Nigeria
Sudan
Argentina

1030
1055
1077
1093
1200

175
176
177
178
179

406

104

Trinidad and Tobago

635

142

Grenada

1256

180

409
410

105
106

Libya
Iraq

637
644

143
144

Gabon
Tanzania

1320
1350

181
182

Greece01

Hungary
Italy
Kazakhstan
LatviaLithuania
Luxembourg
Netherlands
Poland

0
0
0
0
0
0
0
0

1
1
1
1
1
1
1
1

United States
Micronesia, Fed.
Sts.
Nepal
JordanMongolia
Malaysia
Singapore
Tajikistan
Lao PDR
MoroccoPortugal

0

1

Malta

230

60

Romania
Slovak Republic
Slovenia
Spain
Sweden

0
0
0
0
0

1
1
1
1
1

ThailandCambodia
China
Oman
Ecuador

233
240
241
244
250

61
62
63
64
65

United Kingdom

01

Ireland

253

66

TurkeySan Marino
West Bank andGazaSerbiaAlbania
Moldova
Botswana
UkraineBosnia andHerzegovina
Bhutan

46
50

29
30

265
265

67
67

50

30

266

69

Burundi444

107

Suriname

658

145

Bahamas, The

1385

183

52
77
83
98
100

32
33
34
35
36

Burkina Faso
GuyanaHong Kong SAR,
China
India
Uzbekistan
RwandaPakistan
Chile

Iceland
New Zealand
Mauritius
VietnamBrazilZambiaIndonesia
Puerto Rico
Brunei
Darussalam
Georgia
BahrainMozambique
Nicaragua
GuatemalaSão Tomé and
Príncipe
Algeria
Timor-Leste

266
278
282
287
290

69
71
72
73
74

UgandaMexicoCôte d'Ivoire
Myanmar

447
450
456
457

Niger

462

108
109
110
111
112

Iran, Islamic Rep.
South Africa
Vanuatu
Kiribati
Belize

660
676
681
685
688

146
147
148
149
150

Cameroon
Congo, Rep.
Barbados
Congo, Dem. Rep.
Eritrea

1407
1581
1776
3039
-9999

184
185
186
187
N/A

109

37

Marshall Islands

298

75

Saudi Arabia

464

113

Philippines

690

151

Venezuela

-9999

N/A

110

38

Azerbaijan

300

76

Honduras

483

114

Peru

700

152

Yemen, Rep.

-9999

N/A

Source: CSLS Calculations, based on the World Bank Report.

129
Panel C: Cost to export: Documentary compliance (USD), 2020
Country

Cost

Austria
Belgium
Croatia
Czech Republic
Denmark
Estonia
FranceGeorgia

0
0
0
0
0
0
0
0

Ranking
1
1
1
1
1
1
1
1

Country

Cost

Singapore
Niger
GrenadaIceland
Suriname
SwedenMoldova
Germany

37
39
40
40
40
40
44
45

Ranking
39
40
41
41
41
41
45
46

Country

Cost
64
67
67
70
70
73
74
75

Ranking
77
78
78
80
80
82
83
84

75

84

Barbados

117

123

Kuwait

227

161

75
76
76

84
87
87

117
118
120

123
125
126

Sierra Leone
Uruguay
Lao PDR

227
231
235

162
163
164

Hungary0

1

North Macedonia

45

46

Italy
Luxembourg
Netherlands

0
0
0

1
1
1

Nicaragua
Haiti
Belize

47
48
50

48
49
50

Mongolia
MoroccoNew ZealandFinlandTonga
Saudi Arabia
China
Ireland
Papua New
GuineaPuerto Rico
Eswatini
Fiji

Country

Cost

Timor-Leste
UgandaGuatemala
Oman
Kyrgyz Republic
Nepal
RwandaSeychelles

100
102
105
107
110
110
110
115

Norway01Bhutan50

50

Guyana78

89

PolandPortugal
Romania

0
0
0

1
1
1

Chile
CyprusDominica

50
50
50

50
50
50

80
80
80

90
90
90

San Marino

01

El Salvador

50

50

80

90

0

1

Kosovo

50

50

80

0

1

Libya

50

50

Spain

0

1

Peru

50

50

Albania

1021

Bulgaria

52

59

Korea, Rep.

11

22

Philippines

53

60

Benin
Costa Rica
Honduras
St. Vincent and
the Grenadines
West Bank andGaza
Taiwan, China
Equatorial
GuineaBurkina Faso
Brunei
Darussalam

Madagascar
Pakistan
Paraguay
Antigua andBarbudaComoros
Cabo Verde
GuineaSlovakRepublic
Slovenia

Hong Kong
SAR, China
Dominican
Republic
MarshallIslands
Bosnia andHerzegovina

Ranking
107
116
117
118
119
119
119
122

Country

CostSão Tomé and Príncipe
South Sudan
Gabon
Kazakhstan
Tunisia
ZambiaBangladesh
Brazil

194
194
200
200
200
200
225
226

Ranking
153
153
155
155
155
155
159
160

121

127

Angola

240

165

124
125
128

128
129
130

Azerbaijan
Nigeria
Trinidad and Tobago

250
250
250

166
166
166

Mauritius

128

130

Solomon Islands

257

169

90

Gambia, The

133

132

Australia

264

170

84

95

Côte d'Ivoire

136

133

Tanzania

275

171

85

96

Indonesia

139

134

Uzbekistan

292

172

86

97

Vietnam

139

135

Maldives

300

173

90

98

Myanmar140

136

Cameroon

306

174

140

136

Kiribati

310

175

12

23

Japan

54

61

Colombia

90

98

United ArabEmirates

15

24

South Africa

55

62

Jamaica

90

98

Burundi150

138

Liberia

330

176

20

25

Turkey55

62

Lesotho

90

98

Qatar

150

138

Tajikistan

330

176

22

26

India

58

64

Mauritania

92

102

Ghana

155

140

Malawi

342

178

92

102

Canada156

141

Afghanistan

344

179

95
96

104
105

Guinea-Bissau
Mozambique

160
160

142
142

Namibia
Somalia

348
350

180
181

Bolivia

25

27

Sri Lanka

58

64

Malta
Togo
UnitedKingdomMontenegro
Switzerland
Lithuania
GreeceMali
LatviaMalaysia

25
25

27
27

60
60

66
66

25

27

60

66

Thailand

97

106

Congo, Rep.

165

144

Algeria

374

182

26
27
28
30
33
35
35

31
32
33
34
35
36
36

Argentina
BelarusCentral African
Republic
EcuadorIran, Islamic Rep.
IsraelMexicoMicronesia, Fed. Sts.
PanamaUnited States

RussianFederation
Djibouti
Senegal

60
60
60
60
60
60
60

66
66
66
66
66
66
66

100
100
100
100
100
100
100

107
107
107
107
107
107
107

Zimbabwe
Ethiopia
Botswana
Samoa
Chad
Vanuatu
Kenya

170
175
179
180
188
190
191

145
146
147
148
149
150
151

Sudan
Congo, Dem. Rep.
Bahamas, The
Syrian Arab Republic
Iraq
Eritrea
Venezuela

428
500
550
725
1800
-9999
-9999

183
184
185
186
187
N/A
N/A

Serbia35

36

St. Lucia

63

76

Armenia
BahrainCambodia
Egypt, Arab Rep.
JordanLebanonPalau
St. Kitts and
Nevis

100

107

Ukraine

192

152

Yemen, Rep.

-9999

N/A

Source: CSLS Calculations, based on the World Bank Report.

130
Panel D: Cost to import: Documentary compliance (USD), 2020
Country
Austria
BelarusCost
00

Ranking1
1Country
Singapore
Suriname

Cost
40
40

Ranking38
38

Belgium

0

1

Moldova41

41

Bulgaria
Croatia
Czech Republic
Denmark

0
0
0
0

1
1
1
1

42
43
43
50

42
43
43
45

Estonia01

KosovoMarshall Islands
Thailand
BhutanBrunei
Darussalam

50

45

Finland

0

1

Chile

50

45

France01Colombia

50

45Country
Eswatini
China
Micronesia, Fed.
Sts.
Nepal
New Zealand
Peru
Mongolia
Papua New
GuineaWest Bank andGaza
Nicaragua
Iran, Islamic
Rep.
Jamaica
LesothoMali
St. Kitts andNevis
St. Vincent and
the Grenadines

Cost
76
77

Ranking
77
78

Country
Rwanda
Oman

Cost
121
124

Ranking
115
116

Country
Tajikistan
Côte d'Ivoire

Cost
260
267

Ranking
153
154

80

79

Cabo Verde

125

117

Saudi Arabia

267

154

80
80
80
83

79
79
79
83

BahrainPakistan
LebanonParaguay

130
130
135
135

118
118
120
120

Niger
Sri Lanka
United Arab Emirates
Uruguay

282
283
283
285

156
157
157
159

85

84

Tunisia

144

122

Qatar

290

160

85

84

Tonga

148

123

Uganda

296

161

86

86

Barbados

150

124

Somalia

300

162

Germany

01

Cyprus50

45

GreeceHungary
Iceland

0
0
0

1
1
1

Dominica
GrenadaNorth Macedonia

50
50
50

45
45
45

Italy

0

1

Panama50

45

Kazakhstan

01Turkey

55

54

57

55

Comoros

93

93

Ukraine

162

130

Algeria

400

169

58
60

56
57

Seychelles
St. Lucia
Antigua andBarbudaArmenia
Australia
Djibouti
India
Mexico

93
98

93
95

CanadaIndonesia

163
164

132
133

Mauritania
Liberia

400
405

169
171

100

96

Mauritius

166

134

Sudan

420

172

100
100
100
100
100

96
96
96
96
96

Gabon
ZambiaGuineaMaldives
Vanuatu

170
175
180
180
183

135
136
137
137
139

AngolaGhana
Central African Republic
Chad
Iraq

460
474
500
500
500

173
174
175
175
175

Latvia01Lithuania
Luxembourg

0
0

1
1

Hong Kong SAR,
China
Fiji
Libya

Malta

0

1

Malaysia

60

57

Netherlands
NorwayPolandPortugal
Romania
SlovakRepublic
Slovenia
Spain
SwedenUnitedKingdom
Albania
Bosnia andHerzegovina
Korea, Rep.
Switzerland
Bolivia
SerbiaGuatemalaDominican
Republic

0
0
0
0
0

1
1
1
1
1

Montenegro
Mozambique
GuyanaNamibia
Taiwan, China

60
60
63
63
65

57
57
61
61
63

90

87

Haiti

150

124

Congo, Rep.

310

163

90
90
90

87
87
87

Madagascar
Zimbabwe
Gambia, The

150
150
152

124
124
128

KuwaitSouth Sudan
Bangladesh

332
350
370

164
165
166

90

87

Russian Federation

153

129

Tanzania

375

167

90

87

Malawi162

130

Sierra Leone

387

168

0

1

Botswana

67

64

Palau

100

96

Vietnam183

139

Senegal

545

178

0
0
0

1
1
1

El Salvador
Philippines
Equatorial Guinea

67
68
70

64
66
67

San Marino
United States
Brazil

100
100
107

96
96
105

Georgia
JordanBurkina Faso

189
190
197

141
142
143

Bahamas, The
Nigeria
Syrian Arab Republic

550
564
742

179
180
181

0

1

Honduras

70

67

Japan

107

105

Azerbaijan

200

144

Ethiopia

750

182

10

31

Israel

70

67

Benin

110

107

Kyrgyz Republic

200

144

Congo, Dem. Rep.

765

183

27

32

South Africa

73

70

Kenya

115

108

Guinea-Bissau

205

146

Cameroon

849

184

27
27
30
35
37

32
32
35
36
37

75
75
75
75
75

71
71
71
71
71

Lao PDR
Timor-Leste
MoroccoArgentina
Cambodia

115
115
116
120
120

108
108
111
112
112

Myanmar
Solomon Islands
Samoa
Uzbekistan
Trinidad and Tobago

210
215
230
242
250

147
148
149
150
151

Afghanistan
Egypt, Arab Rep.
BurundiEritrea
Venezuela

900
1000
1025
-9999
-9999

185
186
187
N/A
N/A

40

38

BelizeCosta Rica
EcuadorIreland
Puerto RicoSão Tomé and
Príncipe

75

71

Kiribati

120

112

Togo

252

152

Yemen, Rep.

-9999

N/A

Source: CSLS Calculations, based on the World Bank Report.

131
Table 2: Dealing with Construction Permits (Number of Days), 2020
Country

Days

Days

Days

Days

Days

Mali
Oman
Pakistan

124
125
125

Namibia
Portugal
Netherlands

160
160
161

Ranking
115
115
117

Country

97
98
99

Ranking
77
78
78

Country

RwandaNiger
Armenia

Ranking37
40
41Country

27.5
35.5
38

Ranking1
2
3Country

Korea, Rep.
Singapore
Marshall Islands
United ArabEmirates

GuyanaBelgium
France

208
212
213

Ranking
153
154
155

47.5

4

Solomon Islands

99

41

Cameroon

126

80

Côte d'Ivoire

163

118

Papua New Guinea

217

156

Malaysia

53

5

Serbia99.5

43Germany

126

80

Congo, Rep.

164

119

219

157

Samoa
MoroccoGeorgia
Denmark
FinlandJordanSão Tomé and
Príncipe
Hong Kong SAR,
China
BurundiBahrainUkraine

57
58
63
64
65
66

6
7
8
9
10
11

Saudi Arabia
TurkeyCabo Verde
Botswana
Montenegro
Kazakhstan

100
100
101
102
102
102.5

44
44
46
47
47
49

Iran, Islamic Rep.
AlgeriaSouth Sudan
Colombia
EcuadorHonduras

130
131
131
132
132
132

82
83
83
85
85
85

Ireland
Puerto Rico
Russian Federation
Vietnam
Iraq
Kyrgyz Republic

164
165
165
166
167
167

119
121
121
123
124
124

Central African
Republic
Austria
Suriname
Nicaragua
Chad
Guatemala
Bolivia

222
223
225
226
226
235

158
159
160
161
161
163

67

12

Estonia

103

50

Tunisia

133

88

Togo

168.5

126

Kosovo

237

164

69

13

Kuwait103

50

Ethiopia

136

89

Ghana

170

127

Czech Republic

246

165

70
71
72.5

14
15
16

Mauritania
Nigeria
Panama

104
105
105

52
53
53

Mongolia
Peru
Poland

137
137
137

90
90
90

Egypt, Arab Rep.
Gambia, The
Senegal

173
173
177

128
128
130

Uzbekistan
Slovenia

246
247.5

165
167

Canada249

168

Lithuania

74

17

St. Kitts and Nevis

105

53

Costa Rica

138

93

Zimbabwe

178

131

254

169

Tonga
United States

77
81

18
19

India
Comoros

106
107

56
57

Maldives
Jamaica

140
140.5

94
95

179
180

132
133

255
260

170
171

Mexico

82

20

Japan

108

58

Fiji

141

96

Malta
Bahamas, The
Bosnia andHerzegovina

Trinidad andTobagoSudan
Romania180

133

Uruguay

265

172

97

Greece180

133

Bangladesh

274

173
174

Taiwan, China

82

Brunei Darussalam

83

22West Bank andGaza
Norway109.5

60

Iceland

84

23

China

111

61

Micronesia, Fed. Sts.
Sri Lanka
United Kingdom
Liberia
Qatar
Benin
Myanmar
Palau
North Macedonia
Lao PDR
St. Vincent and the
Grenadines
New Zealand
Mauritius

85
86
86
87
87.5
88
88
90
91
92

24
25
25
27
28
29
29
31
32
33

Seychelles
Thailand
UgandaAzerbaijan
Eswatini
St. Lucia
SwedenMozambique
Nepal
Philippines

113
113
113
116
116
116
117
118
118
120

62
62
62
65
65
65
68
69
69
71

Guinea-Bissau
Antigua andBarbudaEquatorial Guinea
San Marino
Croatia
Djibouti
GrenadaSpain
BhutanGuineaMalawiLuxembourg

Bulgaria
Haiti

20

108

58

Belize

142
143

98

Sierra Leone

182

136

Gabon

275

144

99

Lesotho183

137

Lebanon

276

175

144
145.5
146
146
146
147
150
151
153
155

99
101
102
102
102
105
106
107
108
109

AngolaTanzania
Kiribati
ZambiaItaly
Dominica
LatviaHungary
Madagascar
Chile

184
184
185
188
189.5
191
192
192.5
194
195

138
138
140
141
142
143
144
145
146
147

Moldova
Slovak Republic
El Salvador
Argentina
Albania
BrazilBarbados
Venezuela, RB
CyprusCambodia

278
300
310
318
324
338
377
434
507
652

176
177
178
179
180
181
182
183
184
185

92

33

Australia

120.5

72

South Africa

155

109

Afghanistan

199

148

Eritrea

-9999

N/A

93
95.5

35
36

Burkina Faso
Paraguay

121
121

73
73

Switzerland
Tajikistan

156
157

111
112

Indonesia
Israel

200
200

149
149

-9999
-9999

N/A
N/A

97

37

Congo, Dem. Rep.

122

75

Belarus

158

113

Dominican Republic

206

151

97

37

Vanuatu

123

76

Kenya

159

114

Timor-Leste

207

152

Libya
Somalia
Syrian Arab
Republic
Yemen, Rep.

Source: CSLS Calculations, based on the World Bank Report.

-9999

N/A

-9999

N/A

132
Table 3: Enforcing Contracts (Number of Days), 2020
Country

Days

Singapore
New Zealand
Bhutan

164
216
225

Ranking
1
2
3

Uzbekistan

225

3South Sudan

228

Rwanda230

Belarus275

Country

Days

Days

Days

Days

520
522
523

Marshall Islands
Mali
Serbia

616
620
622

Ranking
115
116
117

Country

Iraq
MalawiEcuadorRanking
77
78
79

Country

430
437
444

Ranking38
40
41

Country

Vanuatu
United Kingdom
United States
United ArabEmirates

El Salvador
Lao PDR
Burundi

816
828
832

Ranking
153
154
155

445

42

Albania525

80

Turkey623

118

Costa Rica

852

156

5

Burkina Faso

446

43

Côte d'Ivoire

525

80

Algeria

630

119

872

157

6

France447

44Ethiopia

530

82

Puerto Rico

630

119

885

158

530

82

North
Macedonia

634

121

Belize

892

159

540

84

Bahrain

635

122

Canada

910

160

540

84

Jordan

642

123

Nepal

910

160

545
545
550

86
86
88

St. Lucia
Yemen, Rep.
Croatia

645
645
650

124
124
126

Seychelles
Honduras
Mozambique

915
920
950

162
163
164

7

Estonia

455

45

Haiti

Syrian Arab
Republic
Micronesia, Fed.
Sts.

Georgia285

9

Namibia

460

47

Korea, Rep.
GuineaLuxembourg

290
311
321

10
11
12

Kenya
LatviaEquatorial Guinea
Antigua andBarbudaPeru
Cambodia

465
469
475

48
49
50

Brunei
DarussalamWest Bank andGaza
Bahamas, The
Montenegro
Jamaica476

51

Congo, Rep.

560

89

Ireland650

126

Eswatini

956

165

478
483

52
53

Bulgaria
Tunisia

564
565

90
91

650
660

126
129

Philippines
Israel

962
975

166
167

Azerbaijan

277

8

Samoa

455

45

Kosovo330

13

Russian Federation
Mexico

337
341

14
15

Tonga

350

16

Sweden483

53

Kuwait

566

92

Japan
Kazakhstan
Lithuania
Mauritania
Mongolia
Nigeria - Lagos
Ukraine

360
370
370
370
374
376
378

17
18
18
18
21
22
23

Denmark
FinlandTogo
Eritrea
Mauritius
Nicaragua
Uganda

485
485
488
490
490
490
490

55
55
57
58
58
58
58

Armenia
Qatar
San Marino
Saudi Arabia
Somalia
St. Kitts and Nevis
Guyana

570
570
575
575
575
578
581

93
93
95
95
95
98
99

SenegalBotswana
Central African
Republic
Kiribati
Czech Republic
PolandGrenadaLibya
Djibouti
Ghana

Niger

380

24

China

496

62

Moldova

585

100

590

101

591
591

Hong Kong SAR,
China
Austria385

25

Solomon Islands

497

63

397

26

Germany

499

64

Fiji

397

27

Belgium

505

65

Norway400

28

Iran, Islamic Rep.

505

65

Vietnam

400

28

Malta

505

65

Australia

402

30

Comoros

506

68

Dominican
Republic
Bolivia
Papua New
GuineaBenin
Bosnia andHerzegovina
St. Vincent and
the Grenadines

660

129

Argentina

995

168

660
678
685
688
690
695
710

131
132
133
134
135
136
137

1010
1071
1100
1120
1160
1160
1160

169
170
171
172
173
173
173

Venezuela, RB

720

138

Egypt, Arab Rep.
Pakistan
Cyprus
Italy
Gabon
MyanmarSloveniaSão Tomé and
Príncipe

1185

176

Lebanon721

139

Timor-Leste

1285

176

102

Uruguay725

140

Colombia

1288

178

102

Dominica741

141

Angola

1296

179

595

104

Chad

743

142

Liberia

1300

180

595

104

Portugal

755

143

Sri Lanka

1318

181

595

104

Gambia, The

758

144

Barbados

1340

182

1340

182

1402
1442
1445
1642
1711
1715
1785

184
185
186
187
188
189
190

Indonesia

403

31

Morocco

510

69

Oman

598

107

Maldives

760

145

Kyrgyz Republic
Zimbabwe
IcelandThailandCabo Verde
Malaysia
Tajikistan

410
410
417
420
425
425
430

32
32
34
35
36
36
38

Spain
Taiwan, China
Romania
Netherlands
Sierra Leone
Tanzania
Chile

510
510
512
514
515
515
519

69
69
72
73
74
74
76

Switzerland
South Africa
Hungary
Paraguay
Congo, Dem. Rep.
ZambiaLesotho

598
600
605
606
610
611
615

107
109
110
111
112
113
114

Slovak Republic
PanamaCameroon
BrazilPalau
Sudan
Madagascar

775
790
800
801
810
810
811

146
147
148
149
150
150
152

Source: CSLS Calculations, based on the World Bank Report.

Trinidad andTobagoGuatemalaBangladesh
India
Afghanistan
GreeceSuriname
Guinea-Bissau

133
Table 4: Getting Electricity (Number of Days), 2020
Country
United ArabEmirates
Korea, Rep.
St. Kitts and Nevis
Iceland
Taiwan, China
Austria
Hong Kong SAR,
China
Malaysia

Days

Ranking

7

1

13
18
22
22
23

2
3
4
4
6

Antigua andBarbudaFinlandTonga
Chile
Congo, Dem. Rep.
Guatemala

24

7

Qatar

24

7

Brunei Darussalam

25

9Singapore
St. Lucia
Germany
Oman
RwandaThailand
Morocco

26
26
28
30
30
30
31

10
10
12
13
13
13
16

Vietnam31

16

Country

United Kingdom
West Bank andGaza
Uruguay
Kuwait
Nepal
GreeceIraq
Djibouti
Niger
Seychelles

China

32

18

Indonesia
Puerto Rico

32
32

18
18

St. Vincent and the
Grenadines
SwedenCôte d'Ivoire

Samoa

34

21

Egypt, Arab Rep.

Days

Ranking

Country

Days

Ranking

Country

Days

Ranking

Country

Days

Ranking

42

39

Portugal

65

75

Algeria

84

115

Pakistan

113

153

42
42
43
44
44

39
39
42
43
43

Tunisia
NorwayPapua New Guinea
Togo
Uganda

65
66
66
66
66

75
79
79
79
79

Ireland
Lao PDR
Moldova
Colombia
Uzbekistan

85
87
87
88
88

116
117
117
119
119

PolandSuriname
Afghanistan
Lesotho
Zambia

113
113
114
114
117

153
153
156
156
158

44

43

Bahamas, The

67

83

Lebanon

89

121

Libya

118

159

67

83

São Tomé and
Príncipe

89

121

Comoros

120

160

67

83

Slovak Republic

89

121

Mali

120

160

67
67
67
67
67
68
69

83
83
83
83
83
91
92

Benin
United States
Estonia
Argentina
Timor-Leste
Ethiopia
Jamaica

90
90
91
92
93
95
95

124
124
126
127
128
129
129

VanuatuBangladesh
Eswatini
Palau
SerbiaMalawi
Brazil

120
125
125
125
125
127
129

160
163
164
164
164
167
168

69

92

Spain

95

129

Montenegro

131

169

46

46

Chad
Dominican
Republic
Marshall Islands
Mauritania
Mauritius
Paraguay
Peru
SenegalBahrainBosnia andHerzegovina

47

47

48
49
49
51
51
52
52

48
49
49
51
51
53
53

52

53

52

53

Guinea69

92

Angola97

132

Congo, Rep.

134

170

52
53

53
58

Myanmar
Sudan

70
70

95
95

97
97

132
132

Canada

137

171
171

58

Albania

71

97

97

132

CyprusSyrian Arab
Republic

137

53

Kenya
Kiribati
North
Macedonia
Central African
Republic
Tajikistan
MexicoSri Lanka

146

173

Turkey34

21

France53

58

Georgia71

97

PanamaSaudi Arabia
Bolivia

35
35
36

23
23
25

India
Solomon Islands
Ghana

53
53
55

58
58
63

Kazakhstan
Armenia
Ecuador

71
72
74

97
100
101

KosovoNamibia
Philippines
DenmarkGrenada

36
37
37
38
38

25
27
27
29
29

JordanNicaragua
Luxembourg
Czech Republic
New Zealand

55
55
56
58
58

63
63
66
67
67

Australia

75

102

Italy
Maldives
Botswana
Iran, Islamic Rep.

75
75
77
77

102
102
105
105

San Marino

38

29

Belize60

69

Barbados

78

107

Slovenia

38

29

Haiti

60

69

Mongolia

79

108

Costa Rica

39

33

Bhutan

61

71

Cabo Verde

81

109

Honduras

39

33

Dominica
Trinidad andTobagoCameroon
Croatia
El Salvador

61

71

Fiji

81

109

Switzerland

39

33

Mozambique
Azerbaijan
Russian Federation

40
41
41

36
37
37

Source: CSLS Calculations, based on the World Bank Report.

Gambia, The
IsraelNetherlands
Belarus
Malta
Micronesia, Fed.
Sts.
Tanzania
Equatorial
GuineaZimbabwe

98

136

Gabon

148

174

98
100
100

136
138
138

BurundiBurkina Faso

158
169

175
176

Belgium

171

177

101
102
102
105
105

140
141
141
143
143

Romania
Cambodia
Venezuela, RB
Guinea-Bissau
Hungary

174
179
208
257
257

178
179
180
181
181

105

143

Bulgaria

262

183

105

143

Ukraine

267

184

106

147

Madagascar

450

185

106

147

Liberia

482

186

61

71

Japan

81

109

Latvia107

149

Eritrea

-9999

N/A

64
65
65

74
75
75

GuyanaLithuania
Sierra Leone

82
82
82

112
112
112

South Africa
Nigeria
Kyrgyz Republic

109
110
111

150
151
152

SomaliaSouth Sudan
Yemen, Rep.

-9999
-9999
-9999

N/A
N/A
N/A