Australia Improves Its Global Competitiveness Ranking

26 Oct 08

The latest Global Competitiveness Index has been released and Australia has moved up one place from 19th overall, to 18th.

The United States still tops the rankings with Switzerland in second place, followed by Denmark, Sweden, Singapore, Finland, Germany and The Netherlands. The UK has dropped 3 place to move out of the top 10 due to weakening of its financial markets.

China continues to lead the way for developing economies and has moved up 4 places and into the top 30 countries.

“Rising food and energy prices, a major international financial crisis and the related slowdown in the world’s leading economies, are confronting policy-makers with new economic management challenges. Today’s volatility underscores the importance of a competitiveness-supporting economic environment that can help national economies to weather these types of shocks in order to ensure solid economic performance going into the future,” said Xavier Sala-i-Martin, Professor of Economics, Columbia University, USA, and co-author of the report.

The Australian Government needs to focus on long term reform agenda the Australian Industry Group (Ai Group) Chief Executive Heather Ridout has announced in response to the survey results.

“The factors underlying Australia’s 2008-09 WEF ranking show that while we need to manage our way through the current crisis and focus on the short term challenges, which are compelling, we also need to keep focus on the longer term reform agenda,” Ridout said.

“The WEF report highlights the areas where Australia needs to focus to build our long-term competitiveness and resilience to the kinds of economic shocks which are currently buffeting the world economy."

Ridout also said that in the current global economic uncertainly, it is "encouraging" that Australia ranks 6th on one of the 12 “pillars” of the global competitiveness ranking – that of financial market sophistication.

"Within its financial markets, Australia ranks third for securities exchange regulation and legal rights and fourth for the soundness of its banks," Ridout said.

Australian Industry Group is a Partner Institute of the World Economic Forum’s Global Competitiveness Programme and is responsible for carrying out the Forum’s Executive Opinion Survey in Australia.

The Global Competitiveness Index report had this to say about Australia's ranking:

"Australia, at 18th place, draws its strongest competitive advantages from the excellent functioning of its goods, labour and financial markets. Within its financial markets, the country ranks third for the regulation of its securities exchanges and for legal rights, and 4th for the soundness of its banks. Australia’s goods markets are characterized by the ease of starting a business: the number of procedures and the time required to start a business are both ranked first internationally. And labour markets are very flexible, characterized by significant ease in hiring and firing employees and a lack of nepotism in the business sector by international standards. Australia also has very strong private institutions, ranked second for the efficacy of its corporate boards and third for the strength of auditing and reporting standards in the country. Higher education and training is also an area of strength, with high enrolment rates at all levels, and very good marks for the quality of the educational system (ranked 9th)."

Click here to read the full report.

Subscribe free-of-charge to the Advanced Manufacturing Bulletin and be kept informed about manufacturing industry news and new manufacturing technology.