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The 20 most competitive economies in the world

A study from the World Economic Forum reveals the economies excelling across the world.

The World Economic Forum's Global Competitiveness Report assesses 140 countries on 98 indicators that measure business investment and productivity.

The indicators are organised into 12 main drivers of productivity including the nations’ institutions, tech savvy, infrastructure, education systems, market size and innovation.

We highlight the top 20 countries from the index, listing their overall average score out of a 100 across the 12 metrics. 

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The World Economic Forum's Global Competitiveness Report assesses 140 countries on 98 indicators that measure business investment and productivity.

The indicators are organised into 12 main drivers of productivity including the nations’ institutions, tech savvy, infrastructure, education systems, market size and innovation.

We highlight the top 20 countries from the index, listing their overall average score out of a 100 across the 12 metrics. 

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20: Israel 

Overall score: 76.6

'Israel leads the Middle East and North Africa. The country has grown to become one of the world’s innovation hubs thanks
to a very strong innovation ecosystem (10th best in the
world).

'Israel spends the most of any country in the index on R&D (4.3% of GDP), and is where entrepreneurial failure is most accepted and innovative companies grow the fastest.

'It can also rely on an extremely educated workforce, with an average of 13 years of schooling (8th globally) and where people acquire the appropriate skills that employers are looking for (2nd globally).'  

 

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19: Luxembourg

Overall score: 76.6

Luxembourg has one of the most stable financial markets. It also has one of the most 'future ready' governments, second only to Singapore in the index.  

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18: New Zealand 

Overall score: 77.5

The 10-year average annual GDP growth for New Zealand stands at 2.3%, while the unemployment rates sits at 4.9%. The country ranks highest for macro economic stability. 

New Zealand also boasts one of the highest levels of 'social capital' at 66. 

 

 

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17: France

Overall score: 78

'France secures a place among the top twenty economies, having recently taken on an ambitious reform program that encompassed
overhauling labour laws, reforming public services (most notably the national railway operator) and making the country more attractive as a destination for high-tech investment.' 

 

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16: Norway 

Overall score: 78.2

Norway has one of the most stable financial markets, scoring about 95. The nation has a 10-year average annual GDP growth of 1.1%, while unemployments stands at 4.2%. 

 

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15: The Republic of Korea  

Overall score: 78.8

'The country leads the ICT adoption pillar, boasting some
of the world’s highest penetration rates of ICTs (information and communication technologies). A global innovation powerhouse, Korea ranks 8th on the Innovation pillar. Notably, it spends the equivalent of 4.2% of GDP on R&D spending, second only to
Israel (4.3%).

'[But] like some of its regional peers, Korea struggles on the less tangible drivers of innovation: critical thinking (35.5, 90th), interaction and diversity (54.5, 80th) and entrepreneurial and corporate cultures (51.3, 50th).' 

 

 

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14: Australia 

Overall score: 78.9

'The country appears in the top 10 of three pillars. Notably, it shares
the top spot of the Macroeconomic stability pillar (100.0).

'It achieves a near perfect mark on the Health pillar (98.5, 8th) and a very high score for the breadth, depth and stability of its financial system (85.6, 13th).

'Outside these areas, Australia’s performance shows room for
improvement.

'The functioning of its labour market (68.5, 22nd) is notably affected by its rigidity: Australia’s innovation capacity (69.8, 18th) is ranked 20 points lower than the best performers in this category.

'The country does well when it comes to research and development
(78.8) but struggles on the softer dimensions of the innovation ecosystem, including on the Interaction and diversity (60.8) and Entrepreneurial culture (61.6) sub-pillars.' 

 

 

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13: Taiwan, China 

Overall score: 79.3

Taiwan is one of the leaders in innovation and is only one of four 'super innovators' to score above 80. Its 10-year average annual GDP growth stands at 2.6%. 

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12: Canada 

Overall score: 79.9

'Canada’s performance across the 12 pillars is generally strong. Canada features in the top 10 of only two pillars: Macroeconomic stability, where the country has a perfect mark of 100, along with
others, and Labour market (77.0, 6th).

'Canada’s labour market is characterized by high flexibility, combined with very strong workers’ protections and gender
parity for labour force participation.'

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11: Finland

Overall score: 80.3

Finland is among a clutch of countries with the most stable financial markets. It also also the best performer when it comes to reliability of police services and intellectual property protection. 

The median for security was 72, with Finland's score of 97.5 meaning its the closest to being free of crime and terrorism. 

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10: Denmark

Overall score: 80.6

'Denmark, one of the smallest markets in Europe, stands out in the region for its very well-functioning labour markets (5th, 78.0), which form the basis of a strong social contract.

'A pioneer of flexicurity, the country manages to reconcile an effective market economy with strong worker protection and
a welfare state, notably through active labor market
policies (71.4, 7th).

'The country provides high levels of stability both for its citizens and the business sector. It scores high on the strength of its institutions (10th, 75.9), its infrastructure (86.3, 14th) as well as it’s the stability of its macroeconomic environment (joint 1st with multiple
economies).'

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9: Sweden 

Overall score: 81.7

'Sweden's performance is even across the twelve drivers of competitiveness, with high scores and high rankings across all 12 pillars.

'Among its highperforming European peers, Sweden seems best
prepared to leverage the opportunities brought by the accelerating technological change.

'The country ranks extremely high on ICT adoption (85.2, 5th), scoring highly both on levels of internet use (89.7, 14th) as well as the quality of its connectivity: 12th on mobile broadband connections, 13th on fixed broadband connection and 5th for fiber connectivity to the home.

'Remarkably, it ranks top globally in terms of the digital skills of its
population (80.6).'  

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8: UK  

Overall score: 82

'The United Kingdom is the fourth-most competitive economy in Europe and eighth-strongest globally (82.0).

'The performance is largely explained by its traditional strengths: very well-functioning markets (78.7, 4th), a top innovation ecosystem (79.2, 7th) and vibrant business dynamism (79.0, 7th).

'Notably, the country’s performance is equally strong across product, labour and financial markets. Independent of other effects of Brexit, the event will, by definition, weaken the United Kingdom’s markets component as integration with the EU is rolled back.

'Other factors will need to compensate. While the UK has a strong innovation ecosystem and a vibrant business sector, it currently looks less prepared than some of its peers to leverage ongoing rapid
technological change.

'ICT adoption is also one of the weakest pillars compared to the other eleven drivers, with the UK ranking only 28th globally (71.1). It also lags interms of its provision of fiber to the home (75th), mobile broadband.' 

 

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7: Hong Kong 

Overall score: 82.3

'Hong Kong's competitiveness landscape is similar to that of Singapore, although it does slightly less well in terms of innovation and labour market efficiency. Hong Kong features in the top 10 of seven of the 12 pillars of the GCI 4.0.

'Remarkably, it ranks second in four pillars: Infrastructure (94.0), where it ranks first in terms of sea port infrastructure and connectivity; ICT adoption (87.9); Financial system (90.1), where it ranks first for stock market capitalization and second for stability (97.0); and Product market (79.0), where it ranks second in terms
of trade openness (84.5).' 

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6: The Netherlands 

Overall score: 82.4

'The Netherlands is the third-most competitive European economy and the sixth-best globally (82.4).

'The Netherlands performs particularly well on institutions (77.9, 4th), especially when it comes to checks and balances (including judicial independence, freedom of the press and government openness), protection of property rights, and ethics and transparency.

'Its economy is particularly strong on openness, which manifests itself in many dimensions. The country’s open innovation environment is marked by forgiving cultural attitudes towards entrepreneurial failure, a great willingness to delegate authority, entrepreneurs who are willing to embrace disruptive ideas, and fast-growing innovative companies (71.5, 6th).

'In the Netherlands, businesses are as easy to set up as they are to unravel.' 

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5: Japan

Overall score: 82.5

'Japan rank second in its region. It is the most improved of the top 10 economies, rising three places compared with the 2017
backcast edition.

'Japan appears in the top 10 of seven pillars. It ranks first in the Health pillar, and Japan’s digital (87.4, 3rd) and physical infrastructures (91.5, 5th) are top notch.

'It notably ranks first on air transport infrastructure (92.5), while 93% of the adult population uses the internet on a regular basis. Japan boasts the world’s third-largest penetration rate of fiber-to-the-home internet connections (23 per 100 population), a remarkable feat given the size of the country.

'Japan’s two weakest pillars are Institutions (71.1, 20th) - where its performance is undermined by low levels of social capital (47.8, 95th) and relatively weak corporate governance (65.8, 40th)—
and Skills (73.6, 26th), where it receives average marks
for the quality of the current (63.0, 26th) and future (73.2,
55th) workforces'

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4: Switzerland 

Overall score: 82.6

'Switzerland features in the top 5 of seven pillars. Switzerland is one of the world’s ‘super innovators’ (82.1, 3rd, behind Germany
and the United States).

'The country is home to large multinationals that are often leaders in their sector, as well as a dense network of SMEs with a reputation
for quality and innovation.

'In addition to research excellence, intense collaboration between the academic and business worlds yields innovative products with
commercial applications.

'An array of factors supports the innovation process, including a conducive institutional framework (77.1, 5th), top-notch transport
and utility infrastructure (3rd), a sophisticated and stable
financial system (89.4, 4th), and a well-functioning labour
market (80.4, 2nd).' 

 

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3: Germany

Overall score: 82.8

'Germany emerges as the strongest European performer in this year’s competitiveness rankings and the third-strongest globally.

'The country stands out in particular for its innovation ecosystem.
It ranks first globally on the Innovation capability pillar (87.5). This result is driven by a strong performance on patents (5th, 100) and research publications (3rd, 100), by top-ranked research institutions (4th, 100), and by a very high degree of buyer sophistication (66.1, 5th), leading to firms constantly being challenged by their customers to innovate.

'Innovators benefit from a vibrant business sector to bring innovations to market (81.6, 2nd). Germany’s strong overall competitiveness performance is further explained by very solid fundamentals, such as a stable macroeconomic environment and a healthy, welleducated and highly-skilled population.' 

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2: Singapore 

Overall score: 83.5

'Singapore ranks second as a result of a very strong performance across the board. Singapore features in the top 10 of seven pillars and in the top 20 of a further four. Openness is the defining feature of this global trading hub and one of the main drivers of its
economic success.

'Singapore leads the Infrastructure pillar with a near-perfect score of 95.7. In particular, it boasts world-class transport infrastructure, services and connectivity. It also tops the Product market pillar
(81.2), where it leads the trade openness component.

'Singapore also punches well above its weight in terms of market size, when taking into account imports (71.0, 27th globally). Singapore also achieves a perfect mark in the Health pillar, thanks to a healthy life expectancy of 74 years, ahead of Japan.

'Singapore is a regional innovation house, but in order to become a global powerhouse, it will need to improve its ecosystem further: Skills (76.0, 20th), Business dynamism (74.7, 16th) and Innovation
capability (75.0, 14th) are the three pillars—besides Market size—where Singapore scores below 80.' 

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1: United States  

Overall score: 85.6

'The United States reclaimed its status of most competitive economy in the world for the first time since 2008. 

'The United States appears in the top three of seven pillars. It leads the Business dynamism pillar, with a score of 94.1, thanks to its vibrant entrepreneurial culture.

'It also ranks first on the Labour market (81.9) and Financial system (92.1) pillars, due to its depth, breadth and relative stability, and achieves a near pefect score on the Market size pillar (99.2, second behind China).

'All these factors contribute to the country’s vibrant innovation ecosystem, making it a ‘super innovator’ (86.5, 2nd behind Germany).

'Although the country’s institutional framework remains very conducive (74.6, 13th), there are indications of a weakening social fabric (63.3, down from 65.5) and worsening security situation
(79.1, 56th) - the United States has a homicide rate five times the average for advanced economies - as well as relatively low checks and balances (76.3, 40th), judicial independence (79.0, 15th), and transparency (75.0, 16th).'

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