Poland takes top honors for 'most improved' in cutting red tape

When Marzenna Weresa asked her students at the Warsaw School of Economics in Poland what they wanted to do after graduation, most said they wanted to work for a transnational corporation. That was in 2005. But now, “more and more want to start their own businesses,” Professor Weresa says, an enthusiasm she attributes to the country’s changing business landscape.

The business environment in Poland improved the most out of 185 economies in 2011-2012, according to a recent World Bank report called Doing Business 2013. The report, which has been published annually for a decade, takes note of reforms that create more jobs and support economic growth.

Doing Business found that 108 economies implemented 201 regulatory reforms over the past year, and that the difficulty of doing business has declined globally since 2005. Reforms this year have included everything from eliminating minimum capital requirements to start a business in Rwanda to setting up 24-hour “customs clearance zones” along the border in Georgia, making it easier for traders to complete the customs process in one stop.

“This is progress,” says Donald Lessard, professor of international management and engineering systems at MIT’s Sloan Business School. But, Mr. Lessard notes, there is still plenty of work to be done,especially in the area of helping businesses build ties to the global economy.

Regulations like “rule of law and the ease of establishing a business are important basic conditions for business growth,” says Lessard. Without laws on the books – that are also enforced – it’s easy for corruption and extraofficial business dealings to take place, he says. Regulations – like Poland's move to digitize records, thus making it easier for businesses to register property, or Costa Rica's new electronic system for municipal taxes which eases compliance – can help build healthy business environments.

Back in Poland, which moved up seven spots in this year’s Doing Business rankings to No. 55, the change Weresa saw in her students’ budding entrepreneurial interests could “reflect regulatory changes in Poland that protect intellectual property and make it more inviting to start a new business,” she says.

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