1. INTERNATIONAL CONFERENCE ON REGIONAL MARKET, DEVELOPMENT OF STATISTICS AND INVESTMENT OPPORTUNITIES
Business Environment Indicators with special emphasis ON SOUTHEAST EUROPE Sarajevo, 6 November 2017.
Eldin Mehić 1

2. Goal
The aim of the presentation is to present an overview of the most commonly used indicators to measure competitiveness and improving the business environment with a special focus on Southeastern Europe and consider the advantages and disadvantages of their use.
The focus is on the following indicators: World Economic Forum Global Competitiveness Index (GCI), the World Bank's Doing Business, World Bank/EBRD Business Environment and Enterprise Performance Survey (BEEPS), OECD Investment Reform Index (IRI) Corruption Perception Index (CPI) EBRD Transition Indicators, World Bank Worldwide Governance Indicators.
Each of these indicators is discussed from the viewpoint of the availability of data for the country, period for publications, objectives and methodology applied in the creation of individual indicators.
Contribution of analysis: a critical review of the advantages and disadvantages of using certain indicators with a view to examining the need for creating new composite indicators to measure competitiveness and improve the business environment in the countries which are studied.

3. Introduction
Business environment refers to all the factors and their effects, which are outside the company, and which either prevent or favor the development of the business.
It includes features of the regulatory, legal, economic, financial, institutional system of a country, community or global economic system.
Business Environment - a key determinant of progress and growth of a country.
In the literature they encounter numerous indicators that measure the competitiveness of the business environment of individual countries from different perspectives using different methodology.
It is assumed that the business environment is closely linked to the economic performance of countries.
one-dimensional (individual) or composite (combine individual indicators), indicators of business environment

4. World Economic Forum Global Competitivene ss Index (GCI)
Name
Web
Coverage
Publication
Goal
Methodology
Advantages
Limitations
World Economic Forum -
Global Competitivene ss Index (GCI)
org/issues/glo bal- competitivene ss
Global, 138 countries
(also included SEE countries)
Annual
Provides a comprehensive measure of the country‘s competitiveness.
Uses a mix of secundary and primary including the perception of a manager regarding the competitiveness. It analyses the countries on scale from 1 to 7. Results are arranged in accordance to the range and success.  
A comprehensive mix of different indicators relevant to the country‘s competitiveness.  
The sample in some countries is small. Possible lack of objectivity in research.
Quality data for some components of the index is questionable.

5. Doing Business Name Web Coverage Publication Goal Methodology
Advantages
Limitations
World Bank Doing Business
iness.org/
Global, 183 countries
Annual
The assessment of the regulatory framework for the business –friendly environment summarized in Doing Business Index.
Collects data on 10 indicators, covering the laws, regulations and procedures, on the basis of survey data experts.
It gives the ranges of countires by different indicators and by the overall ease of doing business.  
A comprehensive analysis of regulatory frame which is the key for business environment.
A very small number of collected data for certain indicators in some of the countries 

6. Business Environment and Enterprise Performance Survey (BEEPS)
Name
Web
Coverage
Publication
Goal
Methodology
Advantages
Limitations
World Bank/
EBRD
Business
Environment
and Enterprise
Performance
Survey
(BEEPS)
m/pages/rese
arch/analysis/
surveys/beeps
.shtml
Regional, 29
Countries in transition
Annual –
Usually every 3-4 years
(last available publication from the year 2014)
To measure a total quality of business environment and impediments of perception by the owners and head of the company.  
The study is based on the perception of more than
companies.
The obstacles are evaluated on a scale from 0 (no obstacles) to 4 (very severe obstacle).
The data in Enterprise survey are published as percentage % of a company out of a total number of a sample.
Collects the data about „reality“ business environment to perception of actual participants.  
Comparison between the countries is problematic because of the different compariosn of referent points.
Subjective opinions may be only loosely connected to the objective conditions present in the business environment.  

7. OECD Investment Reform Index (IRI)
Name
Web
Coverage
Publication
Goal
Methodology
Adventages
Weaknessess
OECD
Investment
Reform Index
(IRI)
Competitivenes and Private Sector Development
Regional, 10 to 6
Countires of South East Europe
2006, 2010, 2016
Estimates 15 policy dimensions which are the key for competitivness of these strategical economies in accordance to the South East Europe 2020 Strategy (SEE 2020).
Qualitative and quantitative indicators are published.
It consists of two comparative assessments – self evaluation of government, which coordinates regional expert organisations and networks, and also independent estimates from local consultants.
Qualitative indicators can be evaluated on the scale from 0-5.
Strong focus on investments.
The synthesis of a wide range of display necessary reforms to improve the business environment.  
- IRI combines available quantitative data (e.g. number ISO certificat) with qualitative data (e.g. answers of the representatives of the private sector through an interview).
- When assessing the valuation for the total dimension not all of the indicators have the same importance. In the case of IRI dimension a simple system is administrated of the importance of individual subdimensions, so the final results because of that should be taken with the caution. – Since the countries are on different levels of the development this means that not all of the dmensions have the equal importance and every country should interprate the results in specific dvelopment contest.
/document/28/
0,3746,en_26
49_34893_40
349212_1_1_
1_1,00.html

8. Corruption Perception Index (CPI)
Name
Web
Coverage
Publication
Goal
Methodology
Advantages
Limitations
TI - Corruption Perception Index (CPI)
parency.org/c pi2011/results/
Global, 176 countries
Annual
Measurement of perceived levels of corruption
CPI 2016 is calculated by 13 different sources of data from 12 different institutions which evaulate the perception of corruption in the past two years. Standardised data on the scale from where 0 is equal to the highest level of perceived corruption and where 100 is the lowest level of perceived corruption.
Only one index is used for different evaluations of perceptionin of corruption.
Possible lack of objectivity.
It uses only a proxy for corruption.

9. EBRD Transition Indicators
Name
Web
Coverage
Publication
Goal
Methodology
Advantages
Limitations
EBRD Transition Indicators
m/pages/rese arch/economic s/data/macro.s html
Regional, 29 countries in transition
Annual
Evaluate the country‘s progress towards market economy (the degree of privatization of large enterprises and privatization of small and medium enterprises, enterprise restructing, the degree of freedom of competition, price liberalization, trade liberalization, development of banking system, development of non-banking financial market and infrastructure.)
Values of transition indicators reflect the judgement of the Office of the Chief Economis EBRD – about the progress of the transition specific to each country. Results are based on classification of the system, which is originally developed in the Report of transition from 1994., but it has been changed due to the other reports. The Indexes can have the value from 1 to 4,33 whereby higher index indicates the convergence of higher developed market economies standards.
Practical example of progress of the countries in transition.  
Attention is not paid to the institional framework necessary for the functioning of markets.
The scoring system still has a strong element of subjectivity.  

10. WB - Worldwide Governance Indicators (WGI)
Name
Web
Coverage
Publication
Goal
Methodology
Advantages
Limitations
Worldwide Governance Indicators (WGI)
Globally, over 200 countries
Anual
Measuring the progress of good governance in the surveyed countries
Aggregate indicators for the six dimensions are averages of the results of the several hundred individual variables from 33 data bases which are constructed by 30 organisations, which also cover 212 different countries and territories, including the data bases from all of the most important organisations that are engaged in measuring competitiveness.
Six composite indicators are useful as a tool for comparability between the countries and also for the evaluation of trends.
The useness of indicators it‘s not only used in formulation of special reforms of management of individual countries contexts. These reforms and evaluation of their progress demand detailed data which can identify relevant limitations of management in certain countries.

11. Finishing considerations
the presence of the advantages and disadvantages of the use of certain indicators
need to develop new indicators for business environment ???
one dimensional set indicator or the composite indicator ???
Methodology: based on secondary or primary data?; sectoral approach?
problem weighting importance of certain characteristics/ dimensions of business environment
users? 