ANALYSIS: World Bank’s New Ranking of Business Environments Puts China’s Reputation at Risk

The World Bank’s reformed business index will survey private enterprises directly. As the CCP increasingly squeezes China’s private sector, experts warn that its ranking may plummet.

The closed office of the Mintz Group, seen in an office building in Beijing on March 24, 2023. Five Chinese employees at the Beijing office of the US due diligence firm were detained by authorities. Greg Baker/AFP via Getty Images

Two years ago, the World Bank scrapped the publication of its annual Doing Business report after World Bank executives were caught pressuring top bank officials to manipulate the data in favor of China. In May, the international financial institution announced that it had created a new ranking system, to be launched next year, that improves upon the scandal-ridden Doing Business report.

Over the past two months, local government officials in China have been zealously studying how their jurisdictions can achieve a good score on the new Business Ready—or B-READY—index. It comes at a time when the Chinese Communist Party (CCP) is greatly concerned about a drop in its rankings, experts say. As the country’s business environment deteriorates, any harm to the country’s reputation will potentially lead to an accelerated exodus of foreign firms.

Scandal Leads to Ranking Index Overhaul

The World Bank, founded in 1944, offers grants, loans, and economic advice to its 189 member countries. The Washington-based bank has pledged to reduce poverty around the world.