"As for Georgia, the improvements have been quite astonishing. Georgia has a pro-business government and has reformed across the board."

Chinese credit

China also made progress, although it remains only the 93rd easiest country in which to do business.

In the past year, it has cut red tape, reduced the amount of time firms must wait to incorporate and set up a credit database providing information about consumer loans.

Improving business regulation was crucial to job creation, the World Bank said, stressing that many important reforms were simple to implement and did not require major legislative changes.

It also rejected criticism from trade unions that reducing regulation made workers more vulnerable.

"It is all about reducing the size of the informal economy, giving people the chance of getting jobs in the formal economy and reducing poverty," Ms McLeish added.

Africa has made up ground, after lagging behind other continents in previous years.

More than 65 sub-Saharan countries made progress in at least one area, while Ghana and Tanzania pushed through a series of reforms providing greater protection for firms and improving the tax system.

But Zimbabwe was censured for making it more difficult for firms to take on workers, while Eritrea was criticised for banning all private firms for bidding for construction work.

In Venezuela, where President Hugo Chavez's government has sought to expand the state's economic role, the report found it had become harder for firms to set up, obtain credit and register private property.
// BBC