Canada down a notch to 10th in global competitiveness ranking
Thu Sep 9, 4:58 PMThe Canadian Press
By The Canadian Press
BEIJING, China - Canada has dropped one place to 10th in an annual listing of competitive economies compiled by the Geneva-based World Economic Forum, as it lost ground when the Netherlands jumped two spots to claim the No. 8 spot.
Economic innovation is a key factor that differentiates the two countries' ranking in this year's report.
"Dutch businesses are highly sophisticated (ranked 5th) and are among the most aggressive internationally in absorbing new technologies for productivity enhancements (ranked 3rd for their technological readiness)," the report said.
In contrast, Canada was ranked 16th in business sophistication and 16th in technological readiness.
"Improving the sophistication and innovative potential of the private sector, with greater R&D spending and producing higher on the value chain, would enhance Canada’s competitiveness and productive potential going into the future," the report said.
On the other hand, Canada continued to lead the world in terms of its banking system — ranked No. 1 with a score of 6.7, just ahead of New Zealand (6.6). Australia, Lebanon, Chile and South Africa all scored 6.5.
In contrast, the Netherlands ranked 104th in terms of the soundness of its banks with a score of 4.6, ahead of the United States (No. 111), which was tied with Slovenia, Germany, Iran, Azerbaijan, Serbia, Libya and Nepal with a score of 4.4.
The near-collapse of the American banking system in late 2008, which required the government to bail out a number of major companies, precipitated one of the worst global economic slowdowns in decades.
The Canadian Bankers Association hailed the report, calling the bank rankings good news for all Canadians.
"To again be named the soundest banking system in the world is positive for all Canadians," Nancy Hughes Anthony, the retiring president and CEO of the bank lobby group, said in a statement from Toronto.
"A steady and secure banking system is an important contributor to Canada's economic recovery and long-term growth. This report reinforces the fact that, through the financial crisis and into the recovery, our banks have continued to work with consumers and small businesses, providing credit, financial products and advice."
The forum praised the United States for its innovative companies, excellent universities and flexible labour market. But it also cited huge deficits, rising government debt and declining public faith in politicians and corporate ethics.
The United States, which continued to have the world's largest economy in terms of gross domestic product, but the survey dropped the U.S two spots in overall competitiveness to fourth due to huge deficits and pessimism about government.
Switzerland keeps the top spot for the second year in the overall ranking on competitiveness that blends economic data with a survey of more than 13,500 business executives.
The think-tank said Canada benefits from highly-efficient markets, well-functioning and transparent institutions and excellent infrastructure.
In addition, said the report, Canada has been successful in "nurturing its human resources," ranking sixth for health and primary education and eighth for higher education and training.
The report ranks 139 countries on business efficiency, innovation, financial markets, health, education, institutions, infrastructure and other factors.
Switzerland held its top rank due to its strong innovation, evenhanded regulation and one of the world's most stable economic environments.
China performed best among major developing economies, rising two places from last year to 27th based on its large and growing market, economic stability and increasing sophistication of its businesses.
Japan gained two places, helped by strong innovative abilities, though its status was hurt by the country's two-decade-old financial malaise.
Greece plunged 12 places to 83rd, plagued by a debt crisis and mounting public concern about corruption and government inefficiency, according to the WEF.
Chad was 139th and last, below Angola and Burundi.
__ With files from The Associated Press
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