The Economist’s BERs illustrate the impact of the pandemic in 2020, the asymmetric recovery in 2021 and the war in Ukraine in 2022—and all the policy changes that these have prompted—on global operating environments. The BERs measure the attractiveness of the business environment in 82 countries on a quarterly basis, using a standard analytical framework with 91 indicators. Our rankings for the fourth quarter of 2022 show that western Europe and North America remain the best places in the world to do business. Asia ranks third, narrowly ahead of eastern Europe, while the Middle East and Africa region marginally outperforms Latin America.

Western Europe and North America are the regional leaders

The fact that 11 of the top 20 countries in the global ranking are in western Europe reflects the high level of political stability in that region, the presence of large and competitive domestic markets and a strong degree of openness to world trade. Many west European countries were able to roll out significant fiscal support for citizens and businesses during the pandemic in 2020 and again in 2022 as rising inflation raised the cost of living. The short-term economic outlook of the region is poor, as an energy crunch looms this winter, but in the medium term greater investment under the €750bn (US$740bn) EU recovery fund will support the business environment and end Europe’s dependency on Russian energy. Investment will be particularly significant in the digital sector, in pursuing the green agenda and in the transition away from reliance on Russia in the energy sector.

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Biggest winners: Compared with the fourth quarter of 2019, Greece’s ranking increased by 16 places. This significant improvement reflects its poor starting point, given a long-delayed recovery from the government debt crisis that began in 2009, but also the impact of a pro-business majority government that has undertaken reforms, cut taxes and restored confidence in the country. Meanwhile, the US rose by ten places in the rankings. Its performance in most of our categories—including policy towards private enterprise and competition and the labour market—remains very strong.

Biggest losers: Russia’s business environment has suffered irreparable damage as a result of sweeping Western sanctions and the withdrawal from the country of hundreds of Western banks and businesses. Following a major recession in 2022, we expect Russia to seek to build ties with China in the coming years, but market opportunities will remain limited and cross-border transactions severely constrained by sanctions. Ukraine’s economy has been devastated by the war, but the country will benefit from substantial reconstruction aid when the most acute phase of the conflict is past and the war may engender a reform shock.

Read more: EIU