Switzerland retained its position as the world’s most competitive economy as the US slid for a fourth year and divisions in efficiency within the eurozone were exposed.
The US fell two places to seventh in the World Economic Forum’s 144-country league, three years after losing the No. 1 position for the first time since the Geneva-based organization began its current index in 2004. Switzerland displaced the US at the top of the table in 2009.
Taiwan was ranked 13th, a position it has held since the 2010-2011 report.
With the health of the world’s biggest economy center-stage in the presidential election campaign, the US was criticized for a lack of macroeconomic stability. Gaps in crisis-ridden Europe’s competitiveness were highlighted as Germany, Finland and the Netherlands held positions in the top 10, while Spain and Italy sat outside the highest 30.
Switzerland was strong “across the board,” while “a number of escalating and unaddressed weaknesses have lowered the US ranking,” the forum said.
Switzerland, home to companies including drugmaker Novartis AG and food company Nestle SA, was praised for innovation and labor market efficiency as well as the sophistication of its business sector. The nation won points for a stable economy and highly developed financial markets even as its central bank acts to curb the value of its currency.
The US is still the most innovative and measures of financial market development continue to show signs of recovery from the recent crisis, with the country climbing in a sub-index on that score to 16th from 31st two years ago, the forum said.
As the eurozone nears a third year of its debt crisis, north-south differences in the 17-nation region’s competitiveness were evident in the rankings. Finland traded places with Sweden to rise to third, while the Netherlands gained two places to fifth and Germany stayed at sixth.
At the same time, Spain held on to 36th, Italy rose one rank to 42nd and Portugal slid to 49th from 45th. Greece dropped to 96th from 90th, leaving it lower than Argentina and Namibia.
Europe remains “a region with significant disparities,” according to the report, which noted a “distinct possibility” that Greece and perhaps other nations will leave the eurozone.
Elsewhere in the top 10, Singapore lagged behind Switzerland, Hong Kong rose to ninth from 11th and Denmark fell out of the main tier. Even amid recession, the UK rose to eighth from 10th, while Japan skidded to 10th from ninth.
Among the emerging markets, China fell to 29th from 26th, yet remained the most competitive among the so-called BRIC economies. India dipped to 59th from 56th and Brazil climbed five places to 48th.
Among G7 economies, Canada dropped to 14th from 12th and France skidded to 21st from 18th. Of all the nations studied, Burundi was ranked bottom.
The report is based on 12 measures of competitiveness and an opinion poll of business leaders.
Additional reporting by Staff writer