The United States has for the first time in a decade surpassed Singapore and Germany to top World Economic Forum’s global competitiveness index for 2018. The last time the U.S. topped the list was back in 2008. The Global Competitiveness Index is an indicator of an economy’s level of productivity, which is also considered the most important determinant of long-term growth.
The World Economic Forum’s “Global Competitiveness Report” is based on more than 100 separate factors in a number of different categories that have been tweaked slightly to better reflect the modern, rapidly changing, and increasingly digitized world economy.
The list of 140 economies ranks Singapore and Germany at the second and the third positions respectively. Rounding off the top ten in the list are Switzerland, Japan, Netherlands, Hong Kong, United Kingdom, Sweden and Denmark.
As mentioned in the “Global Competitiveness Report,” economies that were more open to low tariffs, collaboration in patent application and ease of hiring foreign labor scored well in terms of innovation and market efficiency.
“At a time of escalating trade tensions and a backlash against globalization, the report also reveals the importance of openness for competitiveness,” the report read. “Global economic health would be positively impacted by a return to greater openness and integration.”
While developed countries rank high in the WEF’s global competitiveness index, developing countries such as India have also shown signs of significant improvement. With a score of 62, India ranked 58th in the latest Global Competitiveness Report.
“This is the largest gain among all G20 economies,” WEF said.
The report claims that the top performers that fall in the “upper and lower-middle-income brackets”, such as China and India, are even outperforming the average among high-income economies.
“China is already more advanced when it comes to investing in research and development sub-pillar than the average high-income economy, while India is not far behind and let down only by its less-efficient bureaucracy for business creation and insolvency,” the report said.