Switzerland less competitive

This year’s Global Competitiveness Report is the latest edition of the series launched in 1979 that provides an annual assessment of the drivers of productivity and long-term economic growth. With a score of 84.8 (+1.3), Singapore is the world’s most competitive economy in 2019, overtaking the United States, which falls to second place. Hong Kong SAR (3rd), Netherlands (4th) and Switzerland (5th) round up the top five. Asia-Pacific is the most competitive region in the world, followed closely by Europe and North America.

Switzerland drops one rank to 5th overall (–0.3 points, 82.3), and second in Europe behind the Netherlands (4th), which overtakes Germany as Europe’s most competitive economy. The country features in the top 10 of eight pillars—tying Hong Kong SAR for the most appearances in the top 10. It obtains the maximum score on the Macroeconomic stability pillar and a near perfect score for Infrastructure (93.2, 4th). Its financial market is among the most developed and most stable (89.7, 4th). Switzerland’s performance is outstanding in areas related to human capital. Switzerland boasts the fifth-longest healthy life expectancy in the world and it ranks first on the Skills pillar (86.7), overtaking Finland. It is the best in the world for vocational training (90.8), on-the-job training (79.0) and employability of graduates (81.4). Combined with a well-functioning labour market (79.5, 2nd), Switzerland’s talents adaptability with regard to the disruptions brought about by the fouth industrial revolution is second to none. Its talent base contributes to making Switzerland one of the world’s top three innovators, ranking third (81.2) on the Innovation capability pillar behind Germany and the United States.

The two areas with the most room for improvement are market efficiency (63.8, 25th), which is severely undermined by high trade barriers (54.7, 87th)—the country also ranks 141st and last for the complexity of its tariff regime—and business dynamism (71.5, 22nd), undermined by a relative aversion for entrepreneurial risk (59.1, 25th) and the relative reluctance of companies to embrace disruptive ideas (53.8, 26th). The ranking for the latter criteria is based on the WEF Executive Opinion Survey. The lack of entrepreneurship was already emphasized by the Global Entrepreneurship Monitor a few weeks ago.

Building on four decades of experience in benchmarking competitiveness, the index maps the competitiveness landscape of 141 economies through 103 indicators organized into 12 themes. Each indicator, using a scale from 0 to 100, shows how close an economy is to the ideal state or “frontier” of competitiveness. The pillars, which cover broad socio-economic elements are: institutions, infrastructure, ICT adoption, macroeconomic stability, health, skills, product market, labour market, the financial system, market size, business dynamism and innovation capability.