Grant Thornton:Red tape threatens to obstruct globalisation opportunities

By Rob Starr, Content Manager, Big4.com

New research from the Grant Thornton International Business Report (IBR) reveals that the number one barrier to international expansion reported by businesses globally is legislation and regulations. With the global economic recovery still tepid at best, lowering barriers to trade and foreign direct investment (FDI) could provide a boost to business growth prospects and help the global economy get back on a surer footing.

And with international expansion increasingly a two-way street between mature and emerging economies, regulations and legislation was cited as the key barrier in North America (50%) and the EU (39%) as well as in Latin America (50%) and the BRIC economies (35%).

These findings are drawn from the 2012 Grant Thornton Emerging markets report, which also ranks the 27 largest emerging economies in terms of the opportunity they offer for business investment using a range of economic indicators. As with the 2010 report, China tops the index, followed by India and Russia. Brazil has moved above Mexico into fourth place. The biggest movers include the ‘frontier economies’ of Indonesia, Chile, Nigeria and Peru.

Ed Nusbaum, CEO of Grant Thornton International Ltd., said: “Dynamic businesses are constantly looking for growth opportunities and expanding into different markets can boost business growth prospects through access to new consumers and new technologies. But mountains of regulations and legislation could prevent businesses considering overseas opportunities.