The Most Competitive Economies in the World
> GCI score: 5.40
> GDP per capita: $45,920 (18th highest)
> Debt as a pct. of GDP: 229.8% (the highest)
> Individuals using Internet: 79.5% (17th highest)
> Infant mortality rates: 2.4 per 1,000 live births (7th lowest)
Japan has the world’s third-largest gross domestic product and generates large domestic and export demand for the goods and services it produces. According to the WEF, Japan exports a diverse array of products and services from all along the value chain–from low value products to high value goods such as semiconductors and auto parts. The country’s production processes are ranked first in the world for technological sophistication. Japan was ranked second for company research and development spending, one of the leading contributors to innovation, above the U.S., which ranked seventh in this category.
9. Hong Kong SAR
> GCI score: 5.41
> GDP per capita: $34,049 (26th highest)
> Debt as a pct. of GDP: 33.9% (52nd lowest)
> Individuals using Internet: 74.5% (25th highest)
> Infant mortality rates: 1.3 per 1,000 live births (the lowest)
Few nations have the quality of infrastructure found in the city of Hong Kong. Railroads, ports and air transportation — all vital for economic efficiency and attracting economic activity — were rated highly by the city’s residents. Despite its extremely small size, Hong Kong still had the 40th-highest GDP of all 144 economies studied by the WEF. According to the foundation, this special administrative region of the People’s Republic of China has the world’s most-developed financial market, beating out much larger countries such as the United States, which was ranked 16th, and China itself, which was ranked 54th.
8. United Kingdom
> GCI score: 5.45
> GDP per capita: $38,592 (22nd highest)
> Debt as a pct. of GDP: 82.5% (18th highest)
> Individuals using Internet: 82.0% (14th highest)
> Infant mortality rates: 4.6 per 1,000 live births (29th lowest)
Of the major indicators measured by the WEF, the United Kingdom scored the best in labor market efficiency, ranking fifth. It was ranked fourth for limiting “brain drain,” reflecting that highly educated residents are choosing to stay in the country. While the country scores well in many areas, it also has weaknesses. Like many of the other countries in Europe, the U.K. faces a challenging macroeconomic environment. Notably, its debt is 82.5% of GDP, placing the U.K. in the top 20 of all 144 countries. Despite austerity measures underway, the country’s Office of Budget Responsibility notes that finances are “clearly unsustainable” over the coming 50 years, and tax increases, spending cuts or a combination of both will be necessary in the future to maintain long-term fiscal health. Of course, tax hikes may not go over well with residents. Taxes, along with access to financing, were considered the greatest obstacle to doing business in the U.K.
7. United States
> GCI score: 5.47
> GDP per capita: $48,387 (14th highest)
> Debt as a pct. of GDP: 102.9% (9th highest)
> Individuals using Internet: 77.9% (20th highest)
> Infant mortality rates: 6.5 per 1,000 live births (41st lowest)
The U.S. has the world’s largest GDP and is also the world’s second-largest exporter, trailing only China. In addition to being big, the country ranks in the top 10 for innovation. Collaboration between research universities and private industry on research and development was especially strong, ranking third in the world only behind Switzerland and the U.K. The U.S. also ranked fifth for the availability of engineers and scientists, another measure that further supports future innovation. However, the country’s competitiveness may be undermined by a government deficit that, at 9.6% of GDP in 2011, was proportionally one of the largest in the world.
> GCI score: 5.48
> GDP per capita: $43,742 (20th highest)
> Debt as a pct. of GDP: 81.5% (19th highest)
> Individuals using Internet: 83.0% (12th highest)
> Infant mortality rates: 3.4 per 1,000 live births (17th lowest)
Germany was ranked third in the world for business sophistication by the WEF, seven spots ahead of the U.S. The country ranked first for its ability to produce a broad range of goods and services across the value chain — from low value goods like foodstuffs to high value goods like cars. Germany also ranked eighth in developing business clusters, meaning groups of interconnected businesses that are located in close proximity to each other. According to the WEF, clusters drive innovation, a category in which Germany did better than all but seven other countries. One way the country supported innovation was high spending on research and development, where Germany ranked fourth.