Reason for happiness if Georgia Remains in Top Ten of Doing Business – Business on World Bank report
Georgia ranks 7th among 190 countries in the 2020 Doing Business rating that was published by World Bank (WB). It should be noted that Georgia has lost one position in the rating compared to the previous year, because the country ranked 6th in the 2019 report.
At the same time, Georgia’s score in the 2020 rating is 83.7, up 0.2 points compared to the 2019 report. The rating is prepared based on 10 indicators; including, Georgia has earned additional points in five indicators and maintained other 5 indicators unchanged.
Georgia has recorded the best indicator in terms of starting a business. In this respect the country ranks 2nd worldwide and only New Zealand is ahead. Georgia ranks 5th in terms of property registration and 7th in terms of protection of rights of minority investors.
According to the WB report, in terms of construction licenses, Georgia has improved the quality of construction works through growing publicity of information.
New Zealand ranks first in the Doing Business simplicity with 86.8 points. The country is followed by Singapore, Hong-Kong, Denmark, South Korea and the USA. Besides Georgia, the list of top ten countries also includes Great Britain, Norway and Sweden. Among 190 countries, the last three places were assigned to Venezuela, Eritrea and Somali. As to Georgia’s neighbors, Armenia ranks 47th, Azerbaijan is 34th, Turkey is 33rd and Russia ranks 28th.
“This is a long-term guarantee that the country follows a right strategy”, Natakhtari corporate director Nikoloz Khundzakishvili noted regarding the 2020 Doing Business rating. Being among top ten countries is a good indicator. Similar surveys are vey important, because the part of investors always takes into account similar reports when making investment decisions, he said.
“The 6th or 7th place is the same, in practice. The main thing is that we remain among top ten countries. This is a credit rating, but we want to move forward to the so-called investment rating that will enable to have investment-friendly conditions and environment. At the certain stage, we will make progress in this direction too. Naturally, starting a business in Georgia is very simple. The major challenge consists in absence of bankruptcy legislation, the basis that would foster business sector development. This is one of the obstacles and according to our information, the Authorities have been working to tackle this problem. Wrongly prepared regulations can bring many negative effects”, Nikoloz Khundzakishvili said.
Redix Group founder Lasha Papashvili also agrees with this consideration and assures that the part of investors genuinely take into account the WB report.
“Indeed, investors take the rating into consideration. However, I am sure the national currency devaluation is the worst thing happening. Investors pay more attention to this latter factor. They are cautious even if you are the best, but make certain wrong things. It is not our interest to excessively strengthen LARI. Therefore, we should foster GEL appreciation based on macroeconomic parameters. We should be happy, because we remain among the Doing Business top ten countries. If air traffic is resumed with Russia, this will be the best culmination”, Lasha Papashvili said.
Businessman David Kodua also appraises the WB report. He thinks that Doing Business is simple in Georgia, despite frustrations in certain sectors.
“I am a developer, but I do not have construction licenses. Business has serious potential in Georgia, but Kaladze does not issue construction license, because he lives nearby and he has promised his neighbors not to allow the construction works. I do not know what they mean in doing business. If they make focus on tax code, there are no problems. It is genuinely simple to do business in Georgia, the main thing is that you should not have to obtain a construction license next to Kaladze’s house”, David Kodua noted.
According to the 2020 Doing Business rating, Georgian remains among top ten countries and this is a wonderful fact. We have obtained maximum point and almost in all indicators, we have made progress, Giorgi Pertaia, president of Georgian Chamber of Commerce and Industry noted.
‘As to starting a business, everybody knows in the world that we are leaders in this indicator. The WB has reaffirmed this year that there are only two countries in the world, Georgia and New Zealand, where starting a business is the fastest and simplest”, Giorgi Pertaia noted.
According to Pertaia, similar reports are very important, because the majority of investors worldwide take them into consideration. Investors seeing that Georgia along with Denmark is leader in Europe in simplicity of doing business collect more information about Georgia and the probability of making investments in our country grows. “Everything starts from the interest and perception. Our country needs higher perception. Therefore, similar ratings are of crucial importance for us”, Giorgi Pertaia noted.
He also analyzed the current situation in the region and noted that Azerbaijan has also improved its position in the WB rating and moved to the list of top reformatory countries and ranks 34th in the rating.
“Our objective is to become a regional hub. The fact our neighbors also simplify business procedures, including in terms of cargo transportation on borders will improve the situation in the whole region. This will attract more investors to Georgia and help the country become a regional hub”, Giorgi Pertaia said.