By Lee Hyo-sik
Staff Reporter
Korea ranked 19th out of 183 countries for its business-friendly environment, up four notches from 23rd last year, the World Bank said Wednesday.
This year's standing is the highest ever for Asia's fourth-largest economy, becoming a top-20 business-friendly country.
Also, it is ranked higher than the average for members of the Organization for Economic Cooperation and Development (OECD), which came in 30th.
The improvement came as the country scored big on the easiness of business openings and international trade. But its ranking in labor market flexibility and the tax payment system have fallen.
In a report titled "Doing Business 2010," it announced that Korea's ranking rose mainly on improved conditions for company foundation and cross-border trade.
The report looks into how friendly the environment for business is in the 183 World Bank member economies by assessing taxation, labor market flexibility and eight other business-related variables.
Among subcategories, the nation ranked 53rd in the ease of business establishment this year, up sharply from 126th in 2008, thanks largely to the scrapping of the minimum capital requirement for new companies.
Its standing in trade environment also jumped to 8th from last year's 12th.
But the country saw its ranking in the tax and social welfare-related payment procedure slide to 49th from last year's 43rd, despite the fall in overall tax burden, as Koreans have to spend more time to pay taxes and other social security-related expenses.
The nation's employment flexibility improved slightly to 150th from 152nd, with its ranking in private property registration and investor protection standing at 71st and 73rd.
The Ministry of Strategy and Finance attributed Korea's higher ranking to more streamlined customs procedures and other improved trade environments, adding that eased regulations for company startups played a role in lifting the nation's standing.
"It is largely thanks to the current administration's strenuous efforts to create a more business-friendly environment," the ministry said.
Singapore topped the list of the most business-favorable nation, followed by New Zealand, Hong Kong and the United States. Thailand ranked 12th and Japan 15th.
Out of the 183 World Bank members, 131 nations eased regulations on corporate activities and took other business-friendly policies over the past year to attract more foreign investment in the wake of the global economic slump.
In particular, developing and underdeveloped economies took more drastic steps to create a corporate-friendly setting. Rwanda was named the most improved nation for its business environment, followed by Liberia and the United Arab Emirates.