Where's the Best Place to Do E-Business? 04/08/00 It is no surprise that the US is the world's most "e-business-ready" country, but a new set of global rankings from the Economist Intelligence Unit (EIU) offers some unexpected placements further down the list. Of the 60 countries covered, Japan comes just 21st, India ranks a discouraging 50th, and China rates a mere 51st. Meanwhile, three Nordic economies, Sweden, Finland and Norway, cluster just behind the US at the top of the rankings. The UK ranks a comfortable 6th, but its largest EU partners are relative laggards: Germany at 13th, France at 14th, and Italy at 19th. As this hierarchy suggests, e-business needs more than a large or robust economy to flourish. "Connectivity", or the readiness of the communications infrastructure to handle Internet traffic, is also vital. In assessing e-business readiness country by country, the EIU weighs two factors: the general business environment and "connectivity". In evaluating the general business environment, the EIU screened 70 different indicators covering criteria such as the strength of the economy, the outlook for political stability, the regulatory climate, taxation policies and openness to trade and investment. The resulting "business environment rankings" measured the expected attractiveness of the general business environment over the next five years. "Connectivity" was also factored into the rankings, drawing on a methodology devised by Pyramid Research, the EIU's communications division. Pyramid's assessment takes into account not only the state of the existing telephone network but also other factors that affect Internet access, such as dial-up costs and literacy rates. A country's average score across the two measures yields its e-business-readiness tally. Some of the major conclusions from the survey are: Size is not critical. Some very big countries-China, Indonesia, India, Russia-come far down the e-business-readiness league table. On the other hand, small countries, such as Denmark and Ireland, can be e-business leaders thanks to their sophisticated infrastructure. The world is divided in three. The countries that are readiest for e-business to take off, i.e. those that combine good connectivity with a favourable business environment, occupy roughly the top third of the places in the rankings. Clearly, even in this group there are distinctions: the US is super-ready, whereas countries like France and particularly Japan still show shortcomings, particularly in competition policy. The next 20 or so countries have the potential to catch up if they put the right policies in place, but there is much work to be done. The countries comprising the bottom third of the rankings risk being left behind, and face major obstacles to e-business growth. The US and Western Europe lead the e-business world. Western Europe and North America account for 13 of the top 15 countries. Countries in Africa, the Middle East and Asia dominate the bottom of the table. East European and Latin American countries cluster in the middle. Connectivity counts. The high rating for connectivity catapults the Nordic countries up the ratings above, for example, the UK (which is in 2nd place in the business environment rankings but comes 6th for e-business readiness). Taiwan, Thailand and the Philippines are other countries where a poor connectivity score harms their e-business-readiness ranking, largely because of the relative inferiority of their infrastructure. This conclusion underlines the urgency of telecomms deregulation and, in many cases, the need for significant sums of foreign investment in countries lower down the rankings list.