Mauritius and Rwanda were the top-performing African economies listed in the "Doing Business 2020" report released Thursday by the World Bank Group.
The island in the Indian Ocean is ranked 13th out of 190 countries assessed, the best ranking ever for Mauritius since the publication of the report in 2007 and making it first among African countries.
Last year, Mauritius was ranked 20th globally, progressing from the 25th position in 2017, and 49th in 2016. The country also ranks 2nd among Middle-Income economies, behind Malaysia which also scored 81.5 points, like Mauritius.
Mauritius has laid strong emphasis on providing a conducive business environment to the investor community"
"Mauritius has laid strong emphasis on providing a conducive business environment to the investor community," the government said in a statement.
The World Bank team states that "research demonstrates a causal relationship between economic freedom and Gross Domestic Product (GDP) growth, where freedom regarding wages and prices, property rights, and licensing requirements leads to economic development".
Rwanda ranked 38 and scored 76.3 points against 100, representing a drop of nine positions from last year's edition when the country ranked at 29 globally.
The 2020 report also saw Rwanda's global ranking drop 9-positions to 38th from 29th last year, and according to Rwanda Development Board (RDB), this was mainly caused by the sudden change in methodology which required countries to have a buoyant stock exchange.
"The new methodology introduced the assessment of "an active stock exchange" which was added into the protecting minority investor's indicator in January this year," RDB explained in a statement.
"According to the World Bank, for an economy to be seen as having an active stock market, it has to show at least 10 companies listed and trading equities," it added.
The annual ranking assesses 190 countries on the basis of 10 indicators such as starting a business, dealing with construction permits, getting electricity, registering property and access to credit.
Countries like Togo, Nigeria and Kenya are ranked top improvers with the most reforms, with Cabo Verde and Eswatini implementing a record of four reforms. Other countries that improved are Zimbabwe, Democratic Republic of Congo, Gabon, Niger, and Senegal.
World Bank Group President, David Malpass, said that governments can foster market-oriented development and broad-based growth by creating rules that help businesses launch, hire and expand.
"Removing barriers facing entrepreneurs generate better jobs, more tax revenues, and higher incomes, all of which are necessary to reduce poverty and raise living standards," he said in a statement.
Somalia lags in overall ranking again, while Eritrea, Libya, South Sudan and the Central African Republic also emerged among the worst-performing economies.
New Zealand and Singapore are the two easiest places to do business in the world, according to the report.
The annual rankings are geared at spurring reforms to attract investment and generate jobs.