The Philippines Is Apparently the 'Worst' Place for Startups in the World, According to a Report

If you have plans of starting your own company in the Philippines, you might want to rethink your options. As it turns out, the country is the worst place to be for startups around the world, according to online think tank Business Name Generator (BNG).

Out of 52 countries analyzed in the study, the Philippines emerged as the most challenging environment to launch and run startups in 2024. One reason cited was the not so good economic standing of the Southeast Asian country, with its gross domestic product (GDP) per capita being the second lowest of all nations at $3,754. 

The report further pointed out how it takes relatively long to legally set up a business in the Philippines, lasting a little over a month or approximately 33 days, the third longest time, compared to other countries. 

This sentiment is actually something we’ve long been hearing even from Filipino entrepreneurs themselves, as issues continue to hound the ease of doing business in the country. Business owner Trixie Esguerra-Abrenilla, who organizes the annual Philippine SME Business Expo, earlier pointed out the lack of a centralized system or a one-stop-shop for entrepreneurs to easily apply and register their businesses.

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The Philippines is not the best in terms of quality of life, either, garnering the second lowest score globally at 85.7. While technology and digital innovations are key to growing businesses, the think tank, likewise, cited how the country falls short in providing access to internet, with a “slow” WiFi speed of only 54.37 Mbps (megabits per second).

“However, the Philippines has the second-highest forecasted economic GDP growth of [5.9 percent] in 2024, which is a positive sign for the economy and future startups in the country,” BNG said in its report.

Earlier, the Philippine Statistics Authority (PSA) logged a year-on-year increase by 5.7 percent in the country’s GDP from January to March.

Italy came out second to the Philippines in the list of countries with the least favorable environment for startups and their employees. According to BNG, the European country has the third lowest predicted change in GDP at only 0.7 percent this year, which means its economy is "not improving drastically.” Worse, it charges businesses with a significantly high tax rate of 27.8 percent.

The study found the third most challenging country to launch a startup in is Brazil, with the second most expensive tax rate for businesses at 34 percent. Egypt and South Africa followed at the fourth and fifth spots, while South Korea, Colombia, Switzerland, Australia, and France rounded up the top 10.

So, which are the best countries for startups?

The best option for aspiring entrepreneurs—as well as existing ones—is Hungary. As the report revealed, the country has the lowest corporate tax rate at only nine percent, making it “one of the most economical places to start a business.” Plus points that it only takes seven days to complete the legal proceedings needed in order for startups to get off the ground.

The only downside is probably the relatively low GDP of Hungary at $16,777. But the amount is expected to go up by 3.1 percent this year, which is somehow “promising for new businesses.” The cost of living in Hungary is said to be reasonable enough, too, with expenses estimated at around $694 monthly (excluding rent).

“Not only do low living costs contribute to the overall happiness of employees. [Having] more disposable income [also] encourages more consumer spending, which is good news for startups,” said the report.

Taking second place is the Netherlands, which has the highest GDP in the roster at $51,052. Setting up a new business is a piece of cake—even faster than that of Hungary—as it could only take you four days; while companies operating online can benefit from the country having the second fastest WiFi among all options.

The United Arab Emirates, where many of our overseas Filipino workers are, ranks third in the 10 best countries for startups. Like Hungary, its tax for businesses stands at only nine percent; whereas legally starting businesses takes just four days, similar to the Netherlands. In the same way, the UAE has a “fairly high” GDP of $47,663.

Countries completing the top 10 are Lithuania, Romania, Czech Republic, Finland, Bahrain, Estonia, and Malaysia. Most, as you can see, are in Europe, “providing positive economic and social environments in which entrepreneurs can flourish.”

Ideal countries for employees

Like any business, the success of any startup lies not only in the hands of its owner, but also its employees. At a time when emerging generations heavily consider companies’ values, it’s important to make the happiness and well-being of workers a top priority now more than ever.

Hence, these are the country with the highest happiest scores, as well as those that are the most affordable and livable, based on the study.

1| Finland as the “happiest” country

The top three countries are all in Northern Europe, with Finland having the highest happiness score at about 7.8. The rating was based on various factors, including GDP, social support, life expectancy, population generosity, as well as freedom to make autonomous choices.

Denmark placed second (7.6), followed by the Netherlands (7.4).

2| India as the most affordable country to live in

Workers looking for countries with the cheapest costs of living may consider India. 

The South Asian country is said to be the most affordable, with an average cost of living of $348 per month (rent excluded). Rental fees are estimated at $221 for a one-bedroom apartment in the city, which, as cited by BNG, is still reasonably low, even when combined with other expenses.

Egypt is at second place, with a slightly higher monthly living cost at $421, while Argentina followed with $439.