Spain dropped eight places in World Bank rankings measuring how easy it is to set up a business, Expansion newspaper reported on Tuesday.
Spain went from the number 44 to the number 52 in the study "Doing Business," having been downgraded in seven of the nine categories of evaluation.
Spain currently trails behind developing economies such as Rwanda or Zambia in terms of how easy it is to start up a business.
According to the report, there was a 182 percent rise in the number of companies declared insolvent in the country from 2008 to 2012.
It reportedly takes 28 days to set up a business in Spain. Businessmen have to take up to 10 steps to create it and use 4.7 percent of per capita income.
However, the Expansion report sighted Spanish Ministry of Economy sources as saying that the rankings do not take into account the most recent measures adopted by the Spanish government that help business creation.
The government also emphasized that despite the drop in its ranking, Spain improved in indicators such as protecting investors, trading across borders and enforcing contracts.
Most European countries saw declines in the World Bank rankings.
While Europe is suffering from low growth, Spain began to show signs of recovery in the third quarter of 2013 when it grew by 0.1 percent and further growth expected in 2014.