Philippines among worst countries to launch startup business — study
MANILA, Philippines — A recent study found that the Philippines is the most challenging country to begin a startup business in, largely because of procedure costs and business tax rates.
Business Name Generator, a digital asset under Adventrum, analyzed 50 countries to determine which nations were ideal locations to launch a startup.
The company took into account business tax rates, economic growth of the gross domestic product, startup procedure costs, as well as country happiness, its cost of living, and quality of life to better determine content employees and the drive for productivity and growth.
The Philippines finished at the bottom of the list, highlighted by its high procedure costs at 23.3% of the gross national income (GNI) per capita and a high business tax rate of 25%, which is actually lower than the percentage of the relatively higher placed India and South Korea.
Additionally, the Philippines had the lowest rank for quality of life (81 from a possible 240), which the study suggests could negatively impact productivity, employee engagement, and job satisfaction.
India, however, ranked lowest in country happiness and quality of life — 3.82 and 118.4, respectively — which would likely impact job satisfaction, productivity, and overall workplace well-being; additionally its 30% business tax rate could offset some of the savings gained from available low-cost labor.
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Rounding up the bottom five were Egypt, just below the Philippines, and Vietnam, which placed fifth from the bottom ahead of South Korea and India.
The highest-ranked country was Czech Republic, mainly because of procedure costs at just 1.1% of the GNI per capita and a mean monthly salary of £1,478 (P98,800). In comparison, the Philippines' mean monthly salary for startup employees is P46,700.
The happiest country in the world, Finland, placed second despite higher labor costs juxtaposed by a £3,695 (P247,000) average monthly salary, while Sweden was third with a mean monthy salary at £3,531 (P236,000), procedure costs at just 0.5% of the GNI per capita, but its business taxes is at 20.60%.
Estonia and Slovakia rounded up the top five, with the remaining countries in the top 10 all from Europe — the United Kingdom, the Netherlands, Austria, Denmark and Portugal.
Luxembourg and Switzerland were the only countries not in the top 10 that figured in the top for quality of life, and the latter was joined by Norway in the same conditions for the top five for country happiness.
"Entrepreneurs must carefully consider the economic, demographic and cultural factors of potential locations. They must also evaluate the legal and regulatory environment, including taxes, labor laws and zoning regulations, and how these will impact their operations," said Business Name Generator's spokesperson Chloe Chai.
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