What is the News?
The World Bank Group has recently decided to discontinue publication of its ‘Doing Business’ rankings.
About the Doing Business Report
Doing Business report measures regulations across the 190 economies in 12 business regulatory areas to assess the business environment in each economy.
Read more: World Bank’s Doing Business Report
What led to the decision?
In August 2020, the World Bank paused the publication of Doing Business reports following a number of irregularities were reported regarding changes to the data. The irregularities had affected four countries: China; Saudi Arabia; United Arab Emirates; and Azerbaijan.
The World Bank has later confirmed that the changes were inconsistent with the Doing Business methodology.
An independent probe of data irregularities cited “undue pressure” by top bank officials, including the World Bank’s former CEO, to boost China’s ranking in 2017. This raised ethical matters involving former bank staff and board officials in calculating the rankings.
Why the report is important?
The World Bank’s annual report matters to several nations, especially developing ones. The report greatly influences investor decisions by releasing a ranking of economies based on how easy it is to open up, and operate, a business.
On the other hand, many governments criticized the rankings for their methodology that inaccurately captured the realities on the ground.
What will be done in the future?
The World Bank has now said that a new approach will be worked out to assess countries‘ business and investment climates.
Source: This post is based on the article “World Bank discontinues Doing Business rankings” published in The Hindu on 18th September 2021.