World Economic Forum report rates this country the easiest place to start a company.

New Zealand is the easiest country in the world to start a business, according to a report that also ranked this country second out of 144 nations for the "soundness" of its banking sector.

The World Economic Forum's latest Global Competitiveness Index ranked this country first in terms of the official procedures required to establish a company.

Only one procedure was needed in New Zealand, compared with other countries where multiple procedures could be required.

A company can be established in New Zealand through a relatively simple online process.

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This country was also ranked first in the world in terms of the number of days it took to set up a business. It took only half a day to establish a firm here, according to the report.

Australia was ranked 10th in terms of procedures required (3) and fifth on the time measure (2.5 days).

BusinessNZ chief executive Phil O'Reilly said some countries required a large number of procedures in the company incorporation process because it helped corrupt officials get money out of people.

"Part of the reason New Zealand gets to do this [one procedure] is because we're not corrupt," he said.

Of course, incorporating a company is just the first step in establishing a business.

Read the report here.

But O'Reilly said New Zealand also rated very highly in ease of doing business surveys, such as the World Bank's, which ranks this country third behind Singapore and Hong Kong.

"These are very important marker points for us in terms of attracting [overseas] investors," he said.

Bankers' Association chief executive Kirk Hope said the ranking for New Zealand banks showed the local banking industry was in good shape.

"It reflects that the banks are well-managed and well capitalised."

Canada came first and Australia third in the report's banking rankings.

Our banks were also ranked the second most sound last year, third in 2012 and seventh in 2011.

New Zealand was ranked 17th in the world in the overall competitiveness index, up from 18th last year, while Australia slipped one place to 22nd.

New Zealand did not rate so well in areas such as innovation and business sophistication.

It was ranked 29th in the world, for example, for company spending on research and development and 40th for availability of scientists and engineers.