Since the financial crisis, the UK has been creating businesses at less than half the rate of most European countries, while the number of new businesses within the BRICS economies has far outstripped the number opening up in the G7 countries, according to research by the RSM global network of independent audit, tax and consulting firms.
RSM's report, The Road to Recovery is based on data on business 'births' and 'deaths' over the last five years in 35 countries across its international network'.
It shows that the UK is creating businesses at less than half the rate of most European countries, with the number of active enterprises in the UK rising by just 0.7% since the financial crisis, compared to a European average of 1.4%.
Overall, the BRICS economies (Brazil, Russia, India, China and South Africa) have created new businesses at a rate seven times faster than the G7 (Canada, France, Germany, Italy, Japan, UK and US) between 2007 and 2011.
The BRICS have produced a net gain of 4.8m enterprises, a compound annual growth rate of 5.8% per annum. During the same period, the G7 countries created 846,000 new businesses, representing an annual compound 0.8% growth rate in the number of active enterprises.
Of the 35 countries sampled, Hong Kong has exhibited the fastest rate of new business creation over the last five years, at 9.9% on an annualised basis. South Africa recorded the steepest decline in the number of active enterprises, with a 3.8% drop per annum.
RSM's figures also suggest that European countries are doing better at encouraging new businesses than the US and Canada. Together, the 12 EU countries included in the study produced a net gain of 1.2m, a 1.4% annual growth rate over the five-year period. By contrast, North America added just 158,000 new enterprises, representing a 0.4% annual rate of increase.
Jean Stephens, chief executive of RSM, said: 'The banking sector in many European countries has come under significant pressure to support struggling businesses, which may partly explain why many European countries have seen marginally higher rates of new business creation and survival than the US or Canada.'
