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Denmark Tops List Of Best Countries For Business

For running a business in Europe is rather like author Charles Dickens’ “Tale of Two Cities.” It can be the best of times or the worst of times.

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It all depends where you set up shop. And that’s something investors need to consider when sinking money into ventures overseas.

Denmark, the Scandinavian country squished between Germany and Sweden, is ranked the easiest place to do business in the world, according to the recently published Global Business Complexity Index 2021. The report explains:

  • “In Denmark, you can incorporate a company within a day,due to the fact that there is one single entry point for all registrations, and all necessary bodies and organisations are automatically notified.” 

France came second to worst of the 77 countries ranked.

  1. “France’s place as the second most complex jurisdiction is driven by complexities in accounting and tax processes, and heavily employee-centric HR regulations,” the report states.

Brazil was the most complicated place to do business. The 77 countries accounting for 92% of global GDP, the report’s authors claim.

The survey measured the complexity of accounting and tax, setting up and maintaining a corporation or other business entity, as well as human resources and payroll rules.

The report finds that ease of doing business doesn’t necessarily go hand in hand with the size of the market:

  • “A continuing observation, from our now eight years of reporting on complexity, is that some of the most attractive markets to operate in are both the most complex and the most punitive for getting things wrong.”

Tougher Regulations for Employing People Emerge

Rules regarding employees are getting irksome almost no matter where you locate your business.

During 2020 it became harder to dismiss employees without giving a reason. And government of Argentina now says it is against the law to fire workers, “for any reason,” the report states.

The matter gets worse, the report continues:

  • “Our experts predict that employers will continue to see the rise of pro-employee legislation, which simultaneously encourages companies to act responsibly in their local communities and increases the level of complexity that they must navigate.”

It Should Matter to Investors

Investors should consider the trade off between investing in a country with a complicated business environment against the potential profits that can be made in that country.

For instance, the USA, still ranks near the top of the countries with the least complicated business environment and is by far the richest country in the world.

Meanwhile, Argentina is one of the most complicated places to do business and has a dodgy economy that is around $400 billion in size, compared to $21-22 trillion for the U.S.

In other words, the U.S. still remains a good bet and Argentina isn’t.

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