University Assignment: Australia's EODB Index and Business Challenges

This report examines Australia's Ease of Doing Business Index (EODB), developed by the World Bank to measure business regulations. Australia's current rank of 14 out of 190 countries is analyzed across 10 topics, including starting a business, construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, and resolving insolvency. The report highlights strengths, such as ease of starting a business and credit facilities, while also identifying challenges like obtaining electricity and the complexities of import/export logistics. Key findings include Australia's high ranking in construction permits and contract enforcement, contrasted with issues in electricity connection and cross-border trade, offering insights into the overall business environment and potential areas for improvement.

Running head: INTERNATIONAL BUSINESS
INTERNATIONAL BUSINESS
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1INTERNATIONAL BUSINESS
This paper examines about the ease of doing business index (EODB). World Bank
developed this index to measure the regulations affecting the businesses. High-ranking
countries in the EODB index signifies that the environment is more suitable for starting and
operating a local organisation (“Doing Business in Australia-World Bank Group”, 2018).
Australia is selected to understand its EODB index and the challenges faced by newly
established business organisation. Australia is currently ranked 14 out of 190 countries in the
EODB index (Acs, Szerb & Lloyd, 2017). The EODB index is explained with 10 different
topics. The first and most important step of any business organisation is to setup the business,
according to the EODB index of Australia the starting of business is very effortless. Dealing
with construction business helps to understand the procedures, cost and time requires in
building a warehouse, which also includes licenses and permits. In dealing with construction
permits Australia ranks 6th in DB ranking. The next topic of EODB index is getting
electricity. This topic defines the time and cost requires obtaining permanent electricity
supply for an organisation. Australia ranks 47, which is a big issue for a newly established
organisation. Registering property explains the time, cost and steps, which is needed to
register a property. In this topic, Australia’s DB rank is 51, which means it is quite tough to
register a property in Australia than most of the country. Getting credit is the next topic in
EODB index, which explores two different issues bankruptcy laws in lending and the strength
of credit reporting systems. Australia’s DB rank is six in getting credit. Australia’s strength of
protecting minority investors is very poor and ranked in 57. The protecting minority topic
explains the strength of the minority or new shareholders against the wrong use of corporate
assets by the board of directors. The next topic in the EODB index is paying taxes. In this
topic, Australia’s DB rank is 26, which is comparatively lower. The next topic in EODB
index is trading across borders, which explain the cost, and time requires in exporting and
importing goods. In trading across borders, Australia’s DB rank is 95, which shows that

2INTERNATIONAL BUSINESS
Australia’s logistic system is very time consuming and expensive. Enforcing contracts
measures the cost and time taken to resolve a corporate dispute and the quality of judicial
method. In this indicator, Australia’s DB ranks 3rd, which means the disputes are solved
quickly and the quality of judicial system is better than most of the country. The last indicator
or topic is resolving insolvency; this explains the cost, time and outcome of bankruptcy
proceedings, which involves legal domestic entities. Australia’s DB rank is 18 in resolving
insolvency (Besley, 2015).
Challenges in doing business in Australia:
 Getting electricity: Getting a stable electricity connection is a major issue in doing
business in Australia. It takes about 75 days to get a electricity connection in
Australia.
 Construction permits: Australia may rank higher in this topic than most of the
country but it is very difficult to get a construction permit, it involves 11 different
procedures.
 Imports and exports: The logistic process in Australia is expensive and time-
consuming which severely affects a business organisation (Choudhuri, Ehsan &
Hakura, 2015).
Australia is a country with good environment support for new organisations. The
starting of new firm and credit facilities will help the business organisation. However, there
are some issues related to getting electricity and logistic process across the borders, which is
expected to decrease in the future.

3INTERNATIONAL BUSINESS
References:
Acs, Z. J., Szerb, L., & Lloyd, A. (2017). The global entrepreneurship and development
index. In Global Entrepreneurship and Development Index 2017 (pp. 29-53).
Springer, Cham.
Besley, T. (2015). Law, regulation, and the business climate: The nature and influence of the
World Bank Doing Business project. Journal of Economic Perspectives, 29(3), 99-
120.
Choudhri, E. U., & Hakura, D. S. (2015). The exchange rate pass-through to import and
export prices: The role of nominal rigidities and currency choice. Journal of
International Money and Finance, 51, 1-25.
Doing Business in Australia - World Bank Group. (2018). Doingbusiness.org. Retrieved 19
March 2018, from http://www.doingbusiness.org/data/exploreeconomies/australia