Barbados still has a long way to go
(Internet image) IT IS HARDER to do business here than in Jamaica, St Lucia and Trinidad and Tobago.
Barbados has also received failing grades in the areas of business access to credit, protection of minority investors, and enforcement of contracts.
The island did, however, receive pass marks for regulation associated with starting a business, dealing with construction permits, getting electricity, registering property, paying taxes, trading across borders, resolving insolvency, and labour market regulation.
The data was captured in the
World Bank’s recently released
Doing Business 2019 report. Barbados was listed at 129 out of 190 countries, an improvement over last year’s rank of 132.
However, this was still below the ease of business rankings of Jamaica (75), St Lucia (93), and Trinidad and Tobago (105).
The World Bank publication compares business regulation for domestic firms in the 190 countries. Apart from its rank, Barbados had an ease of business score of 56.78 out of 100.
The ease of doing business score captures the gap of each economy from the best regulatory performance observed on 11 indicators. These were: 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, and labour market regulation.
An economy’s ease of doing business score is reflected on a scale from zero to 100, where zero represents the lowest and 100 represents the best performance.
Based on the latest scores out of 100, Barbados received failing grades for getting credit (30), protecting minority investors (35), and enforcing contracts (38.02).
It scored highest in the category of starting a business (85.15), but even this was below Jamaica (97.35), St Lucia (89.18), Trinidad and
Tobago (88.57), and Grenada (87.26).
Barbados’ other pass marks were paying taxes (71.88), resolving insolvency (69.79), getting electricity (65.12), trading across borders (61.88), dealing with construction permits (56.64), and registering property (54.33).
When the various tallies were examined more closely, Barbados scored higher than other Caribbean islands in some categories, but lower in others. For example, it is easier to get construction permits in Jamaica, but Barbados businesses find it easier to access electricity compared to their Jamaican counterparts.
Additionally, minority shareholders in Trinidad and Tobago receive better protection compared to similar investors in Jamaica, St Lucia, and Grenada, and Barbados, which scored lowest among this group of countries.
Barbados was below St Lucia regarding the ease with which businesses can pay taxes, but ahead of Jamaica, Grenada, and Trinidad and Tobago.
Trinidad and Tobago, like Barbados, failed in the area of contract enforcement, compared to the pass marks received by St Lucia, Grenada, and Jamaica. Barbados virtually matched Jamaica in the scores for resolving insolvency. They had rankings of 34 and 33, respectively, out of 190 countries.
In a snapshot of Barbados’ business reforms in recent years, the report said “Barbados made paying taxes more difficult by introducing a new National Social Responsibility Levy (NSRL) of two per cent on the value of products before [value added tax].
NSRL was subsequently raised to ten per cent, but was abolished effective July 1 by the new administration.
Barbados received its lowest ranking for enforcement of contracts and the highest for resolving insolvencies.
BARBADOS NEEDS to improve its scores in several areas.