It comes as no surprise that the USA is still top dog amongst the world’s most competitive nations, or that half of the top 10 are European, but Asia’s tigers are snapping at their heels.
The 20th World Competitiveness Yearbook, released May 15 by the IMD business school in Lausanne, Switzerland, ranks the U.S. at number 1 for the 15th year in a row, but expects Singapore to take the top spot next year. Asia has proven relatively immune to the financial crisis gripping the U.S, and Asia's roaring economies, led by China, will are likely to become more competitive in comparison with the US and slowing European countries this year.
Among the top 20 economies out of the 55 ranked, those in Asia-Pacific posted the greatest gains compared with last year. Malaysia climbed four places to 19, while Taiwan and Australia each jumped five places 13 and 7, respectively. Other strong gains were made by Thailand, which rose six places to 27, and the Philippines, up five to No. 40.
The top 10 economies have changed little from last year. Iceland, which ranked seventh in 2007, was removed from this year's list due to its volatile economy and financial problems at the local institute that had supplied data to IMD. Hong Kong retained its third-place position, followed by the usual top performers: Switzerland, Luxembourg, and Denmark. Canada moved up two places to 8, while the Netherlands dropped two to 10. Sweden remained unchanged at 9.
China, ranked 17, posted the highest annual GDP growth at 11.9%. In contrast, U.S. GDP rose just 2.2%. The rapid growth of the middle class in emerging economies‚particularly in China and India‚ will boost consumption in the coming years. Roughly 50 million people in India are considered middle class, and this figure will probably swell to 580 million by 2030. Since 2000, about 600 million people around the world reached middle-class status, spending an average of $4 billion annually on brand-name products, new homes, vacations, and other indulgences.
The IMD’s rankings are based on 331 criteria to ranging from gross domestic product growth and unemployment to the number of Internet users and the price of local cell-phone calls.