Despite its prolonged political crisis, Thailand advances six places to 31st position among 144 economies included in the World Economic Forum’s Global Competitiveness Report 2014-2015.
Thailand gradually moved up from 39th in 2011-2012, to 38th in 2012-2013, and 37th in 2013-2014 rankings.
The Report’s Global Competitiveness Index (GCI) showed that Switzerland maintains the No.1 ranking for six years in a row. It is followed by Singapore, the United States, Finland, Germany, Japan, Hong Kong and the Netherlands, the United Kingdom and Sweden.
Japan, China and the five largest Asean economies have all improved their economic competitiveness over the past twelve months, according to the report.
Three Asian economies rank among the ten most competitive nations in the world. These are Singapore (2nd), Japan, which climbs three places to 6th, and Hong Kong (7th).
China, moving up one place to 28th, reinforces its position as the most competitive BRICS economy. India’s decline of 11 places to 71st, set against the gains of the Asean 5 countries, suggests that the competitiveness divide South and Southeast Asia is becoming more pronounced.
The five largest Southeast Asian economies (Asean-5) all feature in the top half of the rankings, and all of them have made strides in this edition: Malaysia gains four places, Thailand is up six, Indonesia four, the Philippines seven, and Vietnam advances two places. Since 2009, they have improved their group performance in every edition. In South Asia, among the region’s six countries covered by the GCI, only India features in the top half of the rankings. Since 2009, the average GCI score of the South Asian Association for Regional Cooperation (SAARC) countries has stagnated.
Xavier Sala-i-Martin, Professor of Economics at Columbia University in the US, added: “Recently we have seen an end to the decoupling between emerging economies and developed countries that characterised the years following the global downturn. Now we see a new kind of decoupling, between high and low growth economies within both emerging and developed worlds. Here, the distinguishing feature for economies that are able to grow rapidly is their ability to attain competitiveness through structural reform.”
Singapore ranks 2nd overall for the fourth consecutive year, owing to an outstanding and stable performance across all the dimensions of the GCI. Again this year, Singapore is the only economy to feature in the top 3 in seven out of the 12 pillars; it also appears in the top 10 of two other pillars. Singapore tops the goods market efficiency pillar and places 2nd in the labor market efficiency and financial market development pillars. Furthermore, the city-state boasts one of the world’s best institutional frameworks (3rd), even though it loses the top spot to New Zealand in that category of the Index. Singapore possesses world-class infrastructure (2nd), with excellent roads, ports, and air transport facilities. Singapore’s competitiveness is further enhanced by its strong focus on education, which has translated into a steady improvement of its ranking in the higher education and training pillar, where it comes in 2nd, behind Finland. Singapore’s private sector is also fairly sophisticated (19th) and becoming more innovative (9th), although room for improvement exists in both areas, especially as these are the keys to Singapore’s future prosperity.
“The strained global geopolitical situation, the rise of income inequality, and the potential tightening of the financial conditions could put the still tentative recovery at risk and call for structural reforms to ensure more sustainable and inclusive growth,” said Klaus Schwab, Founder and Executive Chairman of the World Economic Forum.
In its annual assessment of the factors driving countries’ productivity and prosperity, the report identifies uneven implementation of structural reforms across different regions and levels of development as the biggest challenge to sustaining global growth. It also highlights talent and innovation as two areas where leaders in the public and private sectors need to collaborate more effectively in order to achieve sustainable and inclusive economic development.
“The leading economies in the index all possess a track record in developing, accessing and utilising available talent, as well as in making investments that boost innovation. These smart and targeted investments have been possible thanks to a coordinated approach based on strong collaboration between the public and private sectors,” the report said.