It is important to assess the risks associated with both countries and customers because a rogue customer in a good (from a risk perspective) country is not a much better risk than a good customer in a rogue (from a risk perspective) country.
In this article, I will look at an important new tool: Business Ready (B‑READY), launched by the World Bank in 2024. B‑READY replaces the former Doing Business project and provides a more comprehensive and balanced framework for evaluating the business and investment climate across economies worldwide.
I think we have all heard the words: "The job is not complete until all the paperwork has been done."
Bureaucracy, or as I like to refer to it sometimes, bureaucrazy, is one of the banes of business processes. The less paperwork the better. I can almost hear the chorus of supporting voices from the corporate world who would probably wish for nothing better than no controls. Yet controls are needed at all levels and in many different ways to maintain a reasonably fair trading environment for all.
A lack of regulation is a contributing factor in global financial crises; unfair denial of market access; unwarranted duties on products; the spread of disease, drugs and weapons; and many other global issues. Sometimes we resolve these issues by international agreements, other times there are no such instruments to keep everyone honest. I will explore some of these issues in more detail in later articles.
In this article, I will limit the discussion to the macro-level assessment of a country's regulatory regime by concentrating on some aspects of the B-READY project data. Remember that these data are freely available. The report is searchable, or you can download the data.
B‑READY builds on the legacy of Doing Business but addresses its limitations. Instead of focusing narrowly on ease-of-doing-business rankings, B‑READY captures a fuller picture by examining three core pillars:
B‑READY evaluates economies across 10 topics that span a firm's lifecycle—from market entry to dispute resolution. Below I explore each topic and how they can help exporters assess country-level risks.
This category evaluates how easy—or difficult—it is to register and begin operating a limited liability company (LLC) in a foreign country. For exporters, this information is essential if you're considering opening a selling or buying office abroad.
The B‑READY data look at:
The regulatory and institutional environment for business entry gives early insights into how bureaucratic or supportive a country is toward new commercial ventures.
Thinking about a physical investment, such as a factory or test lab? The Business Location category explores the legal and procedural aspects of acquiring, leasing or building property.
This data can help you assess:
For exporters setting up international operations, these factors carry serious cost and risk implications.
This topic evaluates the reliability and cost-efficiency of securing essential services—electricity, water and internet.
While this may seem secondary, poor infrastructure can delay operations and increase costs. For instance, frequent power outages or slow internet can stall order fulfillment and weaken your competitiveness.
If your business model depends on local infrastructure, this category should be part of your risk review.
Labor regulations and services directly impact both staffing decisions and compliance burdens.
B‑READY assesses:
For exporters entering new markets, understanding the labor landscape is key to planning operations and anticipating potential HR challenges.
Formerly limited to credit information, this new category now encompasses:
These insights are invaluable for understanding both payment risk and financial flexibility in a foreign market.
This is a new addition to the World Bank’s framework. It provides a comprehensive look at a country’s commitment to fair competition and innovation—essential ingredients for a healthy trade environment.
This topic assesses:
If you're entering a new market, understanding the competitive landscape is crucial. Are monopolies common? Is favoritism toward domestic companies baked into procurement? A strong market competition framework can lower the risk of anti-competitive practices and make it easier for your company to enter and thrive.
As Benjamin Franklin famously said, “Nothing is certain except death and taxes.” But in global trade, taxes are far from uniform—and they can dramatically impact your pricing strategy and competitiveness.
While duties are international and generally covered under trade agreements, domestic taxes are entirely at the discretion of the host government. These include:
Exporters often underestimate these costs, especially when selling Ex Works (EXW). But even under EXW terms, if taxes significantly increase the end-user price, you may find your product uncompetitive. Understanding these hidden cost layers is critical when setting pricing and negotiating terms.
Whether you're quoting in a foreign currency, adjusting delivery lead times or choosing an Incoterm, tax implications should be part of your calculations.
This category is of vital importance to exporters. B‑READY provides granular insight into:
This data allows exporters to pre-calculate logistics timelines, documentation requirements and average customs costs before engaging a supplier or buyer. For example, if a country is known for long customs delays or inconsistent procedures, it may pose unacceptable risks for perishable goods or time-sensitive shipments.
Armed with this knowledge, you can perform preliminary costing, identify potential pain points and negotiate smarter—before even placing a call to a new trading partner.
Let’s be honest—no one wants to deal with international litigation. It’s time-consuming, expensive and unpredictable. Yet, contract enforcement is a reality exporters must consider, particularly when extending credit or entering joint ventures.
B‑READY examines:
Real-world examples underscore the importance of this category: In some countries, litigation can take years and consume over 30% of the claim’s value in legal costs. That’s a heavy toll on any business.
Even if you plan to avoid litigation, understanding a country’s legal climate can guide you toward using arbitration clauses, letters of credit, or tighter payment terms to protect yourself upfront.
This final category ties closely to credit risk. When things go south—whether due to economic volatility, partner mismanagement or market shocks—you need to know what legal options exist to recover your funds.
B‑READY looks at:
Recovery rates vary dramatically. In some economies, you may recover 80 cents on the dollar in under a year. In others, you’ll recover just a fraction—if anything—and wait years for the process to conclude.
These insights can influence decisions such as:
By factoring in insolvency data, you get a clearer sense of the true risk of non-payment—and how you can mitigate it before signing the deal.
The B‑READY framework gives exporters a smarter, more realistic view of the markets they’re considering. It goes beyond theory to show what doing business is really like—from opening an office, navigating labor law or clearing customs, to resolving a dispute or collecting debt.
In my next article I will look at the level of competitiveness that exists in each country.
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This article was first published in August 2013 and has been updated to include current information, links and formatting.