Special Report

The Best Economies in the World

Robert Serenbetz, Thomas C. Frohlich

10. Sweden
> GCI score (1-7): 5.408
> GDP per capita: $42,146.88 (12th highest)
> Debt as a pct. of GDP: 41.4% (68th lowest)
> Pct. of residents using Internet: 94.8% (3rd highest)
> Biggest problem in doing business: Tax rates

Sweden is the 10th most competitive economy in the world, falling four spots from a year ago. Unlike much of Europe, the country weathered the recent global financial crisis well, maintaining low levels of debt and strong credit ratings throughout the turmoil. With its world-leading education system, Sweden promotes an innovative economy, with 300.8 patent applications per 1 million residents last year, more than all but three other countries reviewed.

It is also home to companies adept at integrating new technology. Ericsson, for example, is the world’s largest manufacturer of wireless telecom products. And Electrolux and IKEA have become worldwide brands, recognized for their innovation. Sweden’s abilities to adopt technologies and develop new breakthroughs were rated better than all but a few other countries.

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9. United Kingdom
> GCI score (1-7): 5.415
> GDP per capita: $38,309.85 (19th highest)
> Debt as a pct. of GDP: 90.1% (18th highest)
> Pct. of residents using Internet: 89.8% (9th highest)
> Biggest problem in doing business: Access to financing

As one of the world’s largest economies, the United Kingdom has a substantial impact on the global economy. The country benefits from a productive workforce, and is extremely attractive to international talent. The United Kingdom’s ability to adopt existing technologies was rated second best among all nations.

Despite improving its position on the index from a year ago, the country’s economic environment remained poorly rated. It is more difficult to obtain a loan in the United Kingdom than in a majority of countries reviewed. During the financial crisis, the Bank of England contributed substantial funds to supporting the banking system. The government still owns large portions of both Lloyd’s Banking Group and Royal Bank of Scotland, two of the nation’s largest banks.

8. Netherlands
> GCI score (1-7): 5.454
> GDP per capita: $42,143.25 (13th highest)
> Debt as a pct. of GDP: 74.9% (27th highest)
> Pct. of residents using Internet: 93.9% (5th highest)
> Biggest problem in doing business: Restrictive labor regulations

The Netherlands was rated among the worst for hiring and firing practices, as well as for wage determination. Apart from labor market problems, Dutch institutions were among the world’s most competitive. For example, only Singapore and Finland had better rated higher education and training. The Netherlands also has one of the world’s most sophisticated transportation systems. Specifically, the country’s port and road infrastructure were rated nearly the best in the world. The Dutch are well known for their biking culture and bicycles outnumber people in the country. Transit by boat and car also benefit from world-class infrastructure systems.