World Bank: Azerbaijan No. 1 in Reforms

Of 181 countries surveyed, the Caspian Sea nation took the No. 1 spot in the bank's annual "Doing Business" report that evaluates how countries have improved the ease with which entrepreneurs can open new businesses.

A key to securing the top ranking was Azerbaijan's forward-thinking "one-stop shop," also called a "single window" regulation system, that was created this year and which reduced costs and paperwork associated with new businesses. The new system cut business registration time from weeks -- and even months -- down to a matter of days. The World Bank credited a 40 percent surge in new business registrations in the first half of 2008 to the recent improvements.

The enhanced business environment is part of Azerbaijan President Ilham Aliyev's program to diversify the country's economy, which benefits from massive oil and gas reserves lying offshore under the Caspian Sea. Sectors such as construction, agriculture, tourism, manufacturing, and information technologies are among Azerbaijan's reinvigorated areas.

"Fifteen years ago, Azerbaijan made clear to the world that it was open for business in the field of energy," said Azerbaijan's Ambassador to the United States, Yashar Aliyev. "These business reforms and this ranking clearly show that the country is open for a wide range of opportunities. Azerbaijan has much to offer the world."

The report looked at 10 indicators to gauge improvements, including the time needed to open a new business, property rights, the flexibility of employment laws and the simplification of tax payments. Azerbaijan improved in seven of those 10 indicators, catapulting 64 places in the rankings, the biggest jump ever recorded by the World Bank.

The Associated Press quoted a World Bank manager this week as saying: "In the beginning, it was Eastern Europe that was reforming. All of a sudden, this year we've seen this move toward the east and Azerbaijan. There is a lot of competition now in that region."

/MarketWatch/