Switzerland is anything but neutral in the arena of global competitiveness. For the fourth consecutive year, it tops the World Economic Forum’s overall rankings in its annual “Global Competitiveness Report, released Wednesday.
Singapore comes in second, followed by Finland, moving up a notch from the fourth spot in 2011. Sweden dropped a slot to No. 4, while the Netherlands moves up to spots from last year to No. 5.
The United States remains in the top 10, but it dropped two slots to No. 7, falling behind the Netherlands and Germany. The U.S. ranked No. 1 in the 2008-2009 report.
The Global Competitiveness Report 2012–2013 assesses an unprecedented 144 economies, which are ranked based on an index that measures a dozen “pillars of competitiveness,” including innovation, infrastructure and institution. “The Report contributes to an understanding of the key factors that determine economic growth, helps to explain why some countries are more successful than others in raising income levels and opportunities for their respective populations, and offers policymakers and business leaders an important tool in the formulation of improved economic policies and institutional reforms,” the authors state.
The report attributes “political disputes” for America’s slippage in the rankings. This was a contributing factor to Standard & Poor’s decision last year to lower the country’s credit rating. “The business community continues to be critical toward public and private institutions (41st),” the report reads. “In particular, its trust in politicians is not strong (54th), perhaps not surprising in light of recent political disputes that threaten to push the country back into recession through automatic spending cuts,” a reference to the ongoing fiscal cliff debate.
The divisive political climate is the news story that affluent investors surveyed last month by Millionaire Corner said is most impacting their economic outlook. Not surprisingly, this concern is heightened as the campaigns for president intensify and the clock to November ticks down.
The report also chided “wasteful” government spending (76th), as well as the “lack of macroeconomic stability (which) continues to be the country’s greatest area of weakness (111th, down from 90th last year).
The report does note that U.S. companies “are highly sophisticated and innovative, supported by an excellent university system that collaborates admirably with the business sector in R&D.” Also on a positive note, “measures of financial market development continue to indicate a recovery, improving from 31st two years ago to 16th this year.”
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.