Vietnam dropped from number 113 to 118 in this year's list of "Best Countries for Business" announced by Forbes this week.
The ranking, now in its fifth year, is based on 11 categories, including monetary freedom, tax burden, trade freedom and investor protection.
According to Forbes, Vietnam joined the WTO in 2007 and the membership has provided the country "an anchor to the global market and reinforced the domestic economic reform process."
The magazine said the global recession has hurt Vietnam's export-oriented economy. "In 2009 exports fell nearly 10 percent year-on-year, prompting the government to consider adjustments to tariffs to limit the trade deficit"¦ Domestic investment grew 16 percent while committed foreign direct investment fell 70 percent, a steep reduction after five years of growth."
Denmark was ranked as the best place to do business, followed by Hong Kong and New Zealand. The US saw the biggest fall in this year's ranking, falling to number 9 from the second position last year.