Economy

Grand Duchy ranks 20th in the Global Competitiveness Report

A very favourable macroeconomic climate

30-globalThe Grand Duchy has no reason to be shy of its excellent ranking in 20th place in the 2016-2017 edition of the Global Competitiveness Index recently published by the World Economic Forum. Among the 138 countries tested, the Grand Duchy continues to rate as one of the most competitive economies in the world.

Grand Duchy the 9th most competitive country in the European Union

The countries at the top of the list are Switzerland (in first place), followed by Singapore and the USA. As for the Grand Duchy's neighbours, Germany and France rank 5th and 21st respectively, while Belgium is in 17th place. The Netherlands occupy first place among the European Union countries, while the Grand Duchy ranks ninth.

The competitiveness ranking is calculated on the basis of a number of sub-indexes which are in turn influenced by a number of factors. These sub-indexes are divided into 'Basic Requirements', 'Innovation and Sophistication Factors', and 'Efficiency Enhancers'. This last category is defined according to a country's technological readiness — a category in which the Grand Duchy stands in an excellent second position globally.

For details of the Grand Duchy's ranking in the three sub-indexes:

  • the Grand Duchy ranks 9th in the 'Basic Requirements' sub-index (+-0): within this sub-index, the Grand Duchy ranks 8th for institutions (-2), 16th for infrastructures (+1), 7th for macroeconomic environment (+7), and 43rd for health and primary education (-11);
  • The Grand Duchy stands in 23rd place in the 'Efficiency Enhancers' sub-index (+-0): within this sub-index, the Grand Duchy ranks 47th for higher education and training (-7), 4th for goods market efficiency (+-0), 16th for labour market efficiency (+-0), 14th for financial market development (-3), 2nd for technological readiness (-1), and 93rd for market size (+2);
  • the Grand Duchy ranks 16th in the 'Innovation and Sophistication Factors' sub-index (+2): within this sub-index, the Grand Duchy ranks 15th for business sophistication (+4), and 16th for innovation (-1).

Closer analysis of the 2016-2017 edition thus reveals that the Grand Duchy needs to improve in those sub-indexes concerning health and elementary education, post-primary education, and continuous training, given the average results for the Europe and North America area, whereas it excels in technological readiness, institutions, and the macroeconomic environment.

The opinion poll, for which WEF surveys business managers, also makes it possible to identify the main factors hampering the business environment at the national level. The survey shows that inadequate labour-force skills, over-restrictive regulation of the labour market, insufficient innovative readiness, problems with access to financing, and a cumbersome administration are the five main factors cited regarding the development of activities in the Grand Duchy.

The traditionally strong sub-indexes

The Grand Duchy's strong points placed it again this year in the Top Ten of the most competitive countries in the 'traditional' sub-indexes, including institutions (-2, 8th place), goods market efficiency (+-0, 4th place), and technological readiness (-1, 2nd place). Mention should also be made of the improvement in the Grand Duchy's ranking in the 'macroeconomic environment' sub-index (+7, 7th place); this is one of the key criteria for international success, and this year's result is the Grand Duchy's best for some years.

The countries at the top of the list are Switzerland (in first place), followed by Singapore and the USA. As for the Grand Duchy's neighbours, Germany and France rank 5th and 21st respectively, while Belgium is in 17th place. The Netherlands occupy first place among the European Union countries, while the Grand Duchy ranks ninth.

The World Economic Forum's Global Competitiveness Index is one of the most important economic indicators of competitiveness. In its 2016-2017 report, the WEF notes a deterioration in the openness of the global economy, which is damaging to competitiveness and increases the difficulty of ensuring sustainable, inclusive growth.

(Source: press release by the Observatory for Competitiveness)

  • Updated 03-10-2016