What have China, India, Vietnam and Georgia got in common? They are among the best locations for businesses seeking new growth and opportunity, according to panellists at a TMF Group event this week.
The event featured the World Bank’s Joanna Nasr as keynote speaker and focused on her organisation’s annual ‘Doing Business’ report, with highlights of what it sees as the best and most efficient business and regulatory environments across different regions globally.
Joanna told the 120-strong audience that New Zealand is today ranked as the world’s most efficient business environment, followed by Singapore and Denmark. But several countries have risen strongly in the rankings over the 10+ years since the report first started, not least Azerbaijan, Rwanda, Turkey and China, each of which has brought in recent regulatory and legislative changes to make it easier for private sector companies to operate in.
These changes and market conditions are crucial for multinational firms, Joanna pointed out, since simpler business regulations are strongly correlated to higher economic growth, more registrations of new firms, and greater foreign direct investment.
After her presentation, Financial Times Economics Editor Chris Giles moderated a panel including Clare Francis, UK CEO at Standard Chartered Bank; Lorne Somerville, Managing Partner at CVC Capital Partners, and Mark Weil, TMF Group’s CEO. The group discussed the report’s practical implications for business.
The panel expressed a broad range of views, but points of discussion included:
- Geopolitics is higher on the risk register than in previous decades: international trade disputes are often the main topic of conversation amongst board members. But the panel agreed the danger of geopolitical tensions can be overplayed. For example, the US/China trade war may be dominating headlines, but China has risen in the Doing Business rankings. One panellist was adamant that China’s reputation as “a bad actor” is most often unfair. Another panellist noted that Turkey may be in the midst of political controversy and crises, but the country has a huge talent pool, a young population, and strong infrastructure – so the outlook for the private sector and economy is rosy.
- There was agreement that indices and studies such as Doing Business are vital, but do not tell the whole story. For example, one panellist argued that Georgia, a strong improver on the World Bank’s list, still has a long way to go to be seen as a leading creator of vibrant companies. Another mentioned that the USA, listed in many surveys as a great place for companies to operate, is a complicated location to do business because of differing state laws and a litigious business culture.
- Brexit’s effect on the UK will be more nuanced than the scenarios painted by either leavers or remainers. Panellists noted that the weakening pound could cause more impact than any lessening of the country’s competitiveness. There was broad agreement that, in time, the UK should rebound from Brexit due to a rebalancing of the economy from large firms to their smaller cousins.
The event was the first in our new ‘TMF Talks’ which look to explore key issues on international business growth. We have another event planned in the coming weeks. Watch this space!