Saturday, November 24, 2012

World Bank: Conservatives Making Canada Less Business Friendly

People often assume that Conservatives are pro-business, and they are, if that business is restricting other businesses from starting-up and growing.

Annual data from the World Bank shows that since Stephen Harper became Prime Minister, Canada has only become less business friendly.

A report by the World Bank evaluating and comparing different countries regulations and costs associated with starting and running small and mid-sized firms shows that since 2006 Canada has only become a tougher place for businesses.

In the 2006 World Bank's Ease of Doing Business Report Canada was ranked 4th in the world, in this year's paper Canada drastically fell to 17th. While every other country roughly maintained their position in the index, in just eight years Canada dropped by one of the largest margins.

According to the World Bank`s index Canada`s decline from business friendly to business averse has steadily worsened under Stephen Harper`s Conservative government. Though from 2006 to 2007 Canada had the high rank of 4th in the world, in 2008 all the way through to 2010 the country had fallen to 8th. In 2011 it dropped further to 12th, and again in 2012 it plummeted to 15th, until this year it crashed to 17th.

The Ease of Doing Business Index ranks countries on many criteria, like the time and cost it takes to register a company, length of time to do taxes, procedures involved for trading across borders, and the enforcement of contracts.

Canada`s fall is mainly attributable to the fact that though the country has improved on some metrics, like reducing the number of procedures required to start a company, from three in 2005 to just one in 2013; it has worsened on others, like increasing the cost of exporting one container from $700 to $1610 over the same period.

In relation to broad categories Canada has moved up in the rankings of a few like Resolving Insolvency and Paying Taxes but it has worsened on others like Getting Credit and Trading Across Borders. With any improvements in one category being more than cancelled out by regressions in others, it is only becoming harder for businesses in Canada. With a stagnating economy it couldn`t happen at a worse time.

Canada`s fall from in the World Bank`s ranking shows this Conservative government has given little reason for businesses to locate or develop here.It's time this government starts getting down to business of its own, and starts helping others.


The Rat said...

" it has worsened on others, like increasing the length of time to process the registration of a business from three to five days."

I did not know that the federal government registered businesses. Here I thought it was provinces that did that and I was also under the obviously misguided notion that Ontario, Quebec, and BC were run by big "L" Liberal governments during the period of decline in services to business. It's probably wrong headed to think that declining levels of service to business in those large jurisdictions would be the root cause of Canada's decline. But hey, any time you can blame Harper, right? said...

The Rat,

Registering a business was only one of 36 criteria the World Bank measured, before commenting I assume you opened at least one of the reports I cited and saw that a great deal of them fall under the federal government's jurisdiction, like the complete categories of "Protecting investors", "Getting credit" and "Paying taxes"

And I should add that though registering a business is a provincial responsibility, the federal government is responsible for the business climate of Canada as a whole and it should never stop working with the provinces to improve it.

And in all sincerity I thank you for your comment, as I was being unclear. I have made a revision to strengthen the intent of the post.

The Mound of Sound said...

Rat, you're old enough to know better. There are federally and provincially incorporated companies. Sounds like that is news to you. And since when does British Columbia have a big "L" liberal government. There's nothing remotely liberal about the BC Libs and you know it. Your sophistry is showing.