2016年-ECB欧洲央行_Structural_indicators_of_the_euro_area_business_environment_5页_131kb

3 Structural indicators of the euro area business environment

Core Content

The euro area business environment is characterized by significant heterogeneity and generally poor performance compared to global best practices. Structural indicators, such as the World Bank's "ease of doing business" and the Global Competitiveness Index, highlight the challenges faced by euro area countries in terms of legal frameworks, administrative procedures, and competitiveness. These indicators are used to assess the business environment and track progress over time.

Main Points

• Heterogeneity and Performance: Business practices in the euro area are highly varied, and most countries are far from being top performers globally.

• Ease of Doing Business:

  • The World Bank's "ease of doing business" indicator shows that no euro area country is among the top ten global performers.
  • The highest-ranking euro area countries are Estonia (12), Finland (13), and Latvia (14), while the lowest include Luxembourg (59), Greece (61), and Malta (76).
  • During 2008–13, countries like Latvia, Portugal, and Slovenia showed significant progress, but the pace of reform slowed considerably from 2013–16.
  • Only a few countries (Ireland, Austria, the Netherlands, France, Spain, Belgium, and Cyprus) saw notable improvements in the 2013–16 period, while others (e.g., Greece, Italy, Slovakia, and Estonia) moved further away from best practices.
  • The euro area average remains far behind the world's best performers, and some countries are among the worst-performing advanced economies.

• Competitiveness:

  • The Global Competitiveness Index confirms that the euro area lags behind in competitiveness.
  • The Netherlands, Germany, and Finland are among the top ten most competitive economies, while many euro area countries rank among the least competitive.
  • Competitiveness declined in several countries between 2008 and 2013, but improved somewhat between 2013 and 2016, with the exception of Finland and Cyprus.
  • Low total factor productivity (TFP) growth over the past 20 years, combined with a poor outlook for future productivity, highlights the need for major improvements in competitiveness.

• Enforcing Contracts:

  • The average time to enforce a contract in the euro area is over 600 days, compared to about 250 days in the best-performing countries.
  • Countries like Greece, Slovenia, Italy, and Cyprus still take more than three years to enforce contracts, despite some progress after 2008.
  • Luxembourg, Lithuania, and Finland are exceptions, with enforcement times around one year.
  • Lengthy court proceedings and difficulty in enforcing contracts may signal limitations in the legal system, which can discourage investors and reduce access to external financing.

• Opening a Business:

  • Five procedures are required to open a business in the euro area, which is significantly more than the one procedure needed in the best-performing countries.
  • The number of procedures ranges from three (Belgium, Estonia, Finland, Ireland) to nine (Germany, Malta).
  • Most euro area countries, except Greece, made little effort to reduce red tape.
  • Stringent bureaucracy and burdensome regulations hinder efficient resource allocation and may indicate inefficiencies in public administration.

Key Information

• Reform Progress:
  • During 2008–13, some countries made notable progress in improving their business environment.
  • However, the pace of reform slowed significantly in the 2013–16 period.
• Need for Improvement:
  • Addressing weaknesses in the business environment is crucial for increasing investment, productivity, and job creation.
  • Enhancing competitiveness and reducing administrative burdens should be priorities for the euro area.
• Global Comparison:
  • The euro area average is far behind the world's best performers in both "ease of doing business" and competitiveness.
  • Countries like Luxembourg, Lithuania, and Finland are exceptions that have performed relatively well.

Conclusion

The euro area as a whole has a business environment that is not competitive with global best practices. While some countries have made progress in reforming their business environment, the majority have not kept up, and many have even regressed. Structural indicators highlight the need for substantial reforms to improve legal frameworks, reduce administrative burdens, and enhance competitiveness. These reforms are essential for fostering economic dynamism, encouraging enterprise, and ensuring the euro area can withstand future economic shocks.