global competitiveness report 2015-2016 -...

Global Competitiveness Report 2015-2016Caroline Galvan

Vilnius, 01.12.2015

World Economic Forum

Our

Conversation

Today

2

01

Methodology

02

Global Ranking

and Key

Messages

03

Performance of

the EU with a

focus on CEE

and Lithuania

Methodology

3

The set of institutions,

policies, and factors that

determine the level of

productivity of a country.

The level of productivity,

in turn, sets the level of

prosperity that can be

earned by an economy.

4

The Global Competitiveness Index:

What lies behind different growth path?

0

5.000

10.000

15.000

20.000

25.000

30.000

35.000

40.000

1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013

GD

P (

PP

P)

per

cap

ita

Madagascar Brazil China Korea


The Global Competitiveness Index

6

The Global Competitiveness Index

Factor-driven

1.Institutions

2.Infrastructure

3. Macroeconomic

environment

4. Health and

primary education

Efficiency-

driven

Innovation-

driven

5. Higher education

and training

6. Goods market

efficiency

7. Labor market

efficiency

8. Financial market

development

9. Technological

readiness

10. Market size

11. Business

sophistication

12. Innovation


Stages of development and drivers of competitiveness

Innovation-driven stageTransition stageEfficiency-driven

stage

Transition

stage

Factor-driven

stage

Basic

Innovation

Efficiency

$2,0

0 0

$3,0

0 0

$9,0

0 0

$17,0 00

GDP per capitaUS$ (not to scale)

Competitiveness

drivers


Data sources

Quantitative data sourced from

international organizations.

Qualitative data sourced from the annual

Executive Opinion Survey carried out by

the network of the World Economic

Forum’s Partner Institutes.

Global Ranking and Key Messages

9

The Global Competitiveness Report:

Rankings

10

Switzerland retains its 7-year long reign at the top, stable Top-3 this year

Germany overtakes Finland as the most competitive country in the EU at 4th, Greece closes at 81st

Mixed picture in emerging markets: China confirms its 28th place, South Africa re-enters Top 50, India climbs 16 positions to 55th, Brazil least competitive BRIC economy at 75th

Chile remains the most competitive economy in Latin America, at 35th.

Mauritius remains sub- Saharan Africa’s most competitive economy; 15 out of bottom-20 economies are, however, from the region.

Rank Economy1 Switzerland 5.8

2 Singapore 5.7

3 United States 5.6

4 Germany 5.5

5 Netherlands 5.5

6 Japan 5.5

7 Hong Kong SAR 5.5

8 Finland 5.5

9 Sweden 5.4

10 United Kingdom 5.4

11 Norway 5.4

12 Denmark 5.3

13 Canada 5.3

15 Taiwan 5.3

17 United Arab Emirates 5.2

18 Malaysia 5.2

19 Belgium 5.2

22 France 5.1

28 China 4.9

Rank Economy Score

33 Spain 4.6

35 Chile 4.6

37 Indonesia 4.5

38 Portugal 4.5

43 Italy 4.5

45 Russian Federation 4.4

46 Mauritius 4.4

47 Philippines 4.4

49 South Africa 4.4

51 Turkey 4.4

55 India 4.3

56 Vietnam 4.3

57 Mexico 4.3

75 Brazil 4.1

81 Greece 4.0

106 Argentina 3.8

124 Nigeria 3.5

131 Myanmar 3.3

140 Guinea 2.8

The Global Competitiveness Report 2015-2016:

Not settling for the “new normal”

11

In most countries, productivity

growth has slowed down in the

last decade.

This leads to lower levels of

economic growth and higher

unemployment rates.

Improving competitiveness is

key to escape this “new

normal”.

Difference in total factor productivity, unemployment and GDP per capita growth between the

1995–2004 and 2005–14 decades

Sources: The Conference Board; IMF World Economic Outlook (April 2015); World Bank World Development

Indicators


Competitiveness improves resilience

12

A number of risks could derail

the current recovery (e.g.

geopolitical tensions, currency

and commodity price

fluctuations)

More competitive economies

are better placed to withstand

external shocks

Growth rates of the most and least competitive economies, by income group

Average annual growth rate, 2007–14

Sources: IMF World Economic Outlook (April 2015); World Economic Forum

The Global Competitiveness Report 2015-2016: :

Leveraging the human factor – talent at heart of competitive economies

Performance of selected advanced economies on selected human capital–related indicators. Rank out of 140

Performance of the EU with a focus on CEE and Lithuania

14

The Global Competitiveness Report:

Ranking of EU28 economies (out of 140 economies)

15

Germany overtakes Finland as the most competitive country in the EU at 4th, Greece closes at 81st

Lithuania is now the third most competitive economy in Central and Eastern Europe (behind Estonia and the Czech Republic)

Thanks to reform packages aimed at improving the functioning of markets, Spain and Italy climb two and six places respectively. Similar improvements in the product and labour market in France (22nd) and Portugal (38th) are outweighed by a weakening performance in other areas.

Rank Economy Score

36 Lithuania 4.6

38 Portugal 4.5

41 Poland 4.5

43 Italy 4.5

44 Latvia 4.5

48 Malta 4.4

53 Romania 4.3

54 Bulgaria 4.3

59 Slovenia 4.3

63 Hungary 4.3

65 Cyprus 4.2

67 Slovak Republic 4.2

77 Croatia 4.1

81 Greece 4.0

Rank Economy Score

4 Germany 5.5

5 Netherlands 5.5

8 Finland 5.5

9 Sweden 5.4

10 United Kingdom 5.4

12 Denmark 5.3

19 Belgium 5.2

20 Luxembourg 5.2

22 France 5.1

23 Austria 5.1

24 Ireland 5.1

30 Estonia 4.7

31 Czech Republic 4.7

33 Spain 4.6


Performance of EU 28 in the 12 pillars of competitiveness (Score 1-7)

16

Sources: Global Competitiveness Report 2015-2016

The Global Competitiveness Index 2015-2016:

Performance of EU15 and CEE (compared to the US)

17

Overall, CEE performs close to

par with many EU 15

economies

Yet, still considerable gaps in

institutions, infrastructure,

and innovation factors; to

some extent technological

readiness

Sources: World Economic Forum


Performance of Lithuania vs. EU 15

18

LT third most competitive

economy among CEE

economies (36th)

Performs on par with many EU

15 economies in

technological readiness

(22nd)

LT ranks 24th in higher

education and training (third

best in CEE)

Yet, still considerable gaps in

institutions, infrastructure,

and innovation


Performance of Lithuania over time

19


Leveraging the human factor – CEE compared to EU most competitive

economies (Rank out of 140)

21

Economy Manufac

turing %

GDP -

2014

Global

Competitive

ness Index

Quality of the

educational

system

Extent of

staff training

Quality of

math and

science

education

Availability

of scientists

and

engineers

Pay and

productivity

Hiring and

firing

practices

Cooperation

in labor-

employer

relations

Flexibility of

wage

determinati

on

Country

capacity to

retain

talent

Country

capacity to

attract

talent

rank rank rank rank rank rank rank rank rank rank rank

Top-1 Sw itzerland 1 1 1 4 23 4 2 1 16 1 1

Germany 22 4 10 13 16 15 13 107 20 132 13 19

Netherlands 12 5 8 9 7 22 46 89 8 131 11 13

Finland 16 8 4 10 2 1 42 87 22 140 7 61

Sw eden 16 9 25 8 43 14 44 106 7 133 15 25

United Kingdom 9 10 21 21 46 18 21 11 21 15 9 4

Estonia 16 30 34 32 14 73 10 13 28 1 93 86

Czech Republic 25 31 60 39 57 66 18 98 40 17 58 85

Lithuania 20 36 53 35 20 61 27 120 72 11 108 116

Poland 19 41 73 65 51 53 65 97 97 28 116 126

Latvia 12 44 64 42 40 101 23 63 30 2 104 110

Romania n/a 53 90 89 26 57 67 77 90 59 131 113

Bulgaria n/a 54 93 118 62 90 77 86 106 72 133 132

Slovenia 23 59 50 58 13 62 81 136 105 124 98 118

Hungary 23 63 99 114 75 51 87 35 82 68 123 121

Slovak Republic 20 67 121 82 76 80 38 128 98 102 127 129

Croatia 14 77 103 123 31 78 74 129 130 57 134 135

Centr

al a

nd E

aste

rn E

uro

pe

Top-5

EU

Source: World Bank, World Development Indicators and Global Competitiveness Report 2015-2016


Most problematic factors for doing business

22

Inefficient government

bureaucracy, tax rate,

and restrictive labor

regulations remain the

most problematic

factors for doing

business in Lithuania.

An inadequately

educated workforce

ranks 4th – addressing

the labor pool will be

important going forward.

From the list of factors, respondents were asked to select the five most problematic for doing business in their country and to rank them between 1 (most problematic) and 5. The score corresponds to the responses

weighted according to their rankings.


Key messages

1. The EU28 hosts some of the most competitive

economies globally – closing the competitive

gap between Europe’s least and most

competitive economies will be important.

2. From a CEE perspective, the biggest

contribution will be to focus efforts to close the

performance gap in institutions, infrastructure,

and the innovation ecosystem.

3. Efforts to move towards an knowledge-driven

economy with a focus on institutions, talent, and

the innovation ecosystem.

European Union

Central and Eastern

Europe

Lithuania

Thank you for your attention

global competitiveness report 2015-2016 -...

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