Business environment, rule of law key to economic growth

By Paul Burrowes

For an economy to grow, a country must have well-run legal and judicial institutions.
In short, the rule of law impacts the quality of regulations for operating an efficient business.
According to the World Justice Project, the rule of law reigns in Denmark while Singapore tops regulatory quality and efficiency for businesses.
More specifically, the rules by which market functions provide the means to resolve disputes, protect economic and social rights and hold governments accountable for their actions.
When a country promotes investment, a good justice system can contribute to economic growth and development.
The United Nations Office on Drugs and Crime says that “the centrality of a strong justice mechanism lies in its essential contribution to fostering economic stability and growth, and to enabling all manner of disputes to be resolved within a structured and orderly framework” [UNODC, 2011*]. 
Legal framework apart, government attitudes toward markets and freedoms and the efficiency of their operations are also very important: excessive bureaucracy and red tape, overregulation, corruption, dishonesty in dealing with public contracts, lack of transparency and trustworthiness, inability to provide appropriate services for the business sector and political dependence of the judicial system impose significant economic costs to businesses and slow the process of economic development.
Data compiled by two independent international agencies clearly show that the overall quality of the legal system as well as the quality of justice (both civil and criminal) are directly correlated with the business environment and economic performance.
Where, therefore, does Jamaica rank in the quality of the its legal system and the efficiency of its business environment.
Those independent international agencies, the World Justice Project and World Bank's Doing Business 2016 as it relates to regulatory quality and efficiency, put Jamaica at 42 in the 2015 rule of law overall score and 79 in the regulatory efficiency of the business environment.
If Jamaica does well in dealing with construction permits, enforcing contracts, getting credit and electricity, paying taxes, protecting minority investors, registering property, and starting a business under a competent and effective legal framework, the sky's the limit for the land of wood and precious water.
Legislators have to work on limiting government powers, rooting out corruption, maintaining order and security with crime under control, protecting fundamental rights, enforcing regulations for businesses, and improving civil and criminal justice.
Denmark and Singapore are showing the way, but so too have Norway, Sweden, Finland, Netherlands, New Zealand, Austria, Germany and Australia especially in the rule of law.
While on the regulatory enivronment front, add South Korea, United Kingdom, Canada, and the cities of New York City, Hong Kong, Los Angleles, and Taiwan to those already mentioned.