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Bootstrapper News
by Shawn Hessinger on October 29, 2006

Eastern European and Baltic nations are aggressively courting entrepreneurs with far-reaching reforms that streamline business regulations and taxes, according to a new report from the World Bank Group.
The release on the report also states:
The annual report, which for the first time provides a global ranking of 155 nations on key business regulations and reforms, finds that every country in Eastern Europe improved at least one aspect of the business environment-the highest rate of reform of any region.
Romania topped the list of Eastern European and Baltic nations along with Serbia, Montenegro, Slovakia and Latvia for the most reforms enacted.
Specifically, the report overview says:
• Three new private credit bureaus kicked off operations, in Lithuania, Romania, and Slovakia, making it easier for lenders to assess creditworthiness.
• Four countries made it easier to create and enforce collateral agreements: Bosnia and Herzegovina, Croatia, Romania, and Serbia and Montenegro.
• Romania introduced a 16 percent flat tax and cut payroll taxes.
With the exception of the tax reforms, it's hard to see how these changes will be much help to the smallest bootstrap start-up businesses many of which will be borrowing very little yet contributing to an important grass roots economy in the region.
The fact that Starbucks and other multi-nationals can now successfully operate in Eastern Europe is not an economic development triumph, Mr. Wolfowitz.
Despite the World Bank's still lofty rating for the United States, some critics here too have observed that, especially in larger urban environments in which the economic need is greatest, too much regulation, streamlined or not, still hamstrings the smallest of start-up businesses.
Trackback: http://publish.creative-weblogging.com/publish/mt-tb.pl/40720
Mr Wong
Vote for Streamlined regulation aids business climate?:
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Rating: 4.25 out of 4 vote(s) cast.
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Response from:
Shawn Hessinger
(11/02/06 11:04am)
The trouble here, as in every other situation with managed growth, is that there is nothing with which to compare these results. How would we compare the economic progress we've seen with an alternative Romania that followed the fall of Communism with adoption of a totally unregulated economy immediately? We can't answer that question any more than we can answer what the U.S. economy would be like without increasingly regulated commerce. The hole in every argument made by government and quasi-government economic development officials is that there is no control group--no way of telling what growth might have been like with even fewer regulations.
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