World Bank ‘Ease of Doing Business’ Ranks Canada Dismally, Again

Commentary, Ian Madsen, Workplace

The World Bank just issued its annual ‘Ease of Doing Business’ report for 190 countries and territories. Again, Canada was not near the top. It was 18th. Small New Zealand was first, Singapore was 2nd, and Denmark was 3rd. Even our main trading partner, the US, was 6th, and we are behind two countries that most Canadians have not even heard about, Georgia and Macedonia.

That is the bad news. The good news is that there is room for improvement.

The reasons for our poor showing are difficult to comprehend. Registering property is very difficult in Canada, and we are ranked 33rd. Things are even thornier for ‘dealing with construction permits’, where Canada is 54th.

In Toronto, for example, it can take 180 days and cost almost $30,000 for obtaining approval of the Toronto municipal planning authority to build a new building.

Toronto City councillors often are scouring over site plan controls that include, landscaping, pedestrian access, parking, exterior design and appearance, stormwater management and waste disposal for standardized buildings.

Astonishingly, ‘Getting Electricity’ is ranked at 105. In Toronto, it can cost over $44,000 and take over 80 days to get the city to hook up electricity from the Toronto-owned Hydro. No wonder Toronto Hydro is so profitable, pocketing over $150 million last year.

‘Enforcing contracts’ is ranked at 114, where it can take an alarming 930 days to obtain a judgment for a relatively simple dispute, largely due to insufficient court capacity and cumbersome outdated court processes.

‘Trading Across Borders’ is ranked at 46th, partly due to our exceedingly slow import clearance and inspection process. The average time is 2.6 hours which is longer than countries like Albania and Bhutan.

Canada continues to rank poorly against other countries in competition to attract and keep investors, at a time when free-trade agreements are vulnerable, and when capital and talent can easily go to other countries. All three levels of government in Canada need to focus on improving the investment environment by adopting modern regulations that improve the business environment, otherwise our talent, capital, and investors will move towards benefiting other economies rather than our own.

Canadian municipalities and provinces need to streamline their regulatory processes to ensure that buildings, businesses and homes, can be more quickly built and businesses can get on with creating jobs and wealth for Canadians in Canada.

If governments are proactive on these issues, the next ‘Ease of Doing Business’ report, Canada may move up from its dismal 18th position now. We will wait and see.