Singapore is one of only two countries in the world with more than half the workforce (51%) engaged in knowledge-intensive jobs. Only Barbados has more (57.58%).
A country's ranking in the World Economic Forum's Global Competitiveness Report depends largely on an executive opinion survey. If the business executives in one country rate its infrastructure, government institutions or education system highly, its score goes up in those categories. These are used to decide overall rankings.
Singapore is the world's third most competitive economy, according to this year's report, for the second year in a row. Switzerland remains No 1 while Sweden has moved up to second place. America, which slipped to second spot last year, is down to fourth place.
What these rankings reflect is business confidence in a country.
In Singapore, the business executives who took part in the survey were chosen with the help of the Economic Development Board. In some countries, they were chosen with the help of non-government bodies. The London School of Economics helped in Britain, the Confederation of Indian Industries in India.
Singapore excelled in those categories where the rankings were based on the executive opinion survey. The executives, chosen with the help of the Economic Development Board, gave it near-perfect scores for quality of education, public trust in politicians and several other categories.
(These charts from the Global Competitiveness Report are based not on the executive opinion survey but on other sources.)
There were more respondents from Singapore than from many bigger economies to the World Economic Forum's executive opinion survey this year.
The survey is used to prepare the annual Global Competitiveness Report.
Singapore was ranked the world's third most competitive economy this year, same as last year.
This year there were 122 respondents from Singapore compared with 437 in the United States and only 102 in the United Kingdom and 103 in India. There were only 132 respondents from Japan but 362 from China.
Singapore also enjoys greater cohesion than, say, America, Britain or India. Politics is far more polarized in those countries. Have you ever heard a Republican praise a Democrat?
Such polarization can affect a country's ranking in the Global Competitiveness Report because of the way it is compiled.
Singapore is first in the world for quality of higher education, first in math and science and Singapore's politicians enjoy the highest public trust in the world.
That's according to the Global Competitiveness Report 2010-2011, released by the World Economic Forum today.
Singapore remains the world's third most competitive economy, overtaken by Sweden, which has jumped to second place from fourth. Sweden also has the third most trusted politicians in the world, after Singapore and Qatar. (See the list of countries with the most trusted politicians at the end of this post.)
Switzerland remains the world's most competitive economy for the second year running, while America, the former No 1 which dropped to second spot last year, is now down to fourth place. Swiss politicians are the 12th most trusted in the world.
Singapore finishes in the top 20 in almost every category except judicial independence, in which it is ranked 21st, and intensity of local competition, in which it is ranked 28th.
The report is based on national and international data as well as an executive opinion survey. In Singapore, the business executives surveyed were selected with the help of the Economic Development Board. See How the Global Competitiveness Report is prepared.
Singapore remains the world's third most competitive economy, overtaken by Sweden, which moves up to the second spot from fourth place last year.
Switzerland remains No 1 in the Global Competitiveness Report 2010-2011, released today by the World Economic Forum.
The big loser is America, dropping to fourth position after already ceding the top place to Switzerland last year. The report says, "There has been a weakening of the United States’ public and private institutions" and notes "lingering concerns about the state of its financial markets".
The report says Singapore ranks
- First for lack of corruption and for government efficiency
- First for the efficiency of its goods and labour markets
- Second for its financial market sophistication
- Fifth for infrastructure.
Singapore's competitiveness is "buttressed by a strong focus on education, providing individuals with the skills needed for a rapidly changing global economy," says the report.
However, Singapore could "encourage even stronger adoption of the latest technologies as well as policies that enhance the sophistication of its companies", it adds.
Singapore scores lower for innovation, market sophistication, and technological readiness than for health and education, infrastructure, institutions, and efficiency in goods and labour markets. You can see the full report on the World Economic Forum website.
Asian banks have a "once in a lifetime" opportunity of taking a bigger share of the global banking market and perhaps even overtake some of the big Western banks, Government of Singapore Investment Corporation (GIC) deputy chairman Tony Tan tells the Financial Times at the World Economic Forum in Davos. (The Financial Times wrongly calls him chairman: that position is held by Singapore Minister Mentor Lee Kuan Yew.)
You can see him being interviewed by Gillian Tett of the Financial Times here.
Here are some excerpts from the interview (here in full):
“For the GIC, we see no lack of opportunities in the developing world,” he said.
“I think Asian countries will now look again at whether we want to be (following the US),” he said, pointing out that even in the US there was a rethink of laisser faire economics. “State capitalism, interference by the state, has served (some countries) well,” he said.
Singapore is the third most competitive economy in the world, according to the World Economic Forum's Global Competitiveness Report 2009. It was fifth last year. The city-state has become more competitive, according to business leaders, because of the manner in which the government has tackled the recession.
"The country’s institutions continue to be ranked as the best in the world; at a time when confidence in governments in many countries has diminished, they are assessed even more strongly than in past years," says the report.
Switzerland is now ranked the world's most competitive economy, pushing America down to second spot.
But Singapore could be more innovative and more high-tech, says the report, and encourage more broadband Internet use.
Apart from that, the report is all admiration for Singapore. It says:
"Singapore places 1st for the efficiency of its goods and labour markets and 2nd for its financial market sophistication… Singapore also has world-class infrastructure (ranked 4th), leading the world in the quality of its roads, ports, and air transport facilities. In addition, the country’s competitiveness is propped up by a strong focus on education, providing highly skilled individuals for the workforce. In order to strengthen its competitiveness further, Singapore could encourage even stronger adoption of the latest technologies—especially broadband Internet—as well as the innovative capacity of its companies."
Another reason why Singapore does so well in these surveys – and why America fell from first to second place – is money: how the government raises and spends it. High public debt is anathema to business leaders. They value what the report calls "macroeconomic stability". America's "greatest overall weakness continues to be related to its macroeconomic stability," says the report, adding: "Repeated fiscal deficits have led to burgeoning levels of public indebtedness, which are presently being exacerbated by significant stimulus spending." In other words, it does not like President Barack Obama's economic policies.
What the report measures is how good a country is for business – and not its gross domestic product or the size of its economy. China, for example, the third largest economy in the world, is ranked 29th, India 49th.
The 10 most competitive economies are:
|Country||Current rank||Score||2008 rank|
Hong Kong is ranked 11th. It is first in financial market sophistication, second only to Germany in infrastructure, second also in goods market efficiency, fourth in labour market efficiency and ninth in technological readiness.
Singapore is ranked first in institutions, goods market efficiency and labour market efficiency, second in financial market sophistication, fourth in infrastructure, fifth in higher education and training, sixth in technological readiness, eighth in innovation, 13th in health and primary education, 14th in business sophistication, 35th in macroeconomic stability and 39th in market size.
The rankings are based on the so-called 12 pillars of competitiveness: Institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market sophistication, technological readiness, market size, business sophistication, and innovation. (See the full report on the World Economic Forum website.)
Taiwan is 12th, Australia 15th, South Korea 19th and New Zealand 20th among the 133 countries and territories surveyed. Rounding off the top 20, Britain is 13th, Norway 14th, France 16th and Belgium 18th.
Closer to Singapore, Malaysia is 24th, Brunei 32nd, Thailand 36th and Indonesia 54th. Among other countries in the region, Vietnam is 75th, Sri Lanka 79th, the Philippines 87th, Pakistan 101st, Bangladesh 106th, Cambodia 110th and Nepal 125th.
The swine flu outbreak in the middle of the global economic downturn isn't exactly a bolt from the blue. Such a nightmare scenario was envisaged two years ago by the World Economic Forum, no less.
The World Economic Forum's 2007 Global Risk Report didn't categorically say such a disaster was bound to happen, but it looked at the possibility and concluded it would hurt globalization.
A Reuters report published by the Independent yesterday said:
In its 2007 report on global risks, the World Economic Forum imagined the consequences of a simultaneous pandemic and global liquidity crisis – a scenario that was purely speculative then but which now seems eerily prescient.
The result, it said, would be "a backlash against globalisation, which in turn compounds the hit on global demand".
I have since looked at the World Economic Forum's 2007 Global Risk Report and am struck by how it anticipated the current crisis. It mentioned the following possibilities (and I quote):
Chinese economic hard-landing: Chinese growth is both investment- and export-led. The expansion of exports may generate a backlash (particularly in the US); high
investment (over 40% of GDP) has generated excess capacity and fears of potential bad debts.
Fiscal crises caused by demographic shift: The deterioration of fiscal balances in G8 countries, combined with continuing large deficits in other large countries, renders a series of major fiscal crises possible, exacerbated by the long-term challenges of ageing and equitable healthcare provision.
Blow-up in asset prices/ excessive indebtedness: House prices have doubled in most mature markets (and in some emerging markets) in real terms over the last 10 years, putting price-to-income ratios at all-time highs. Many experts fear a major correction, with differential impacts on consumption, economic growth and other asset prices.
This was the official report of the World Economic Forum, the rich men's club which meets in Davos every year. In June 2007, there was also a World Economic Forum on East Asia held in Singapore where Senior Minister Goh Chok Tong spoke of the need for good government.
There had even been prior warnings of the coming downturn.
The then IMF chief Rodrigo de Rato cautioned at the IMF/World Bank conference in Singapore in September 2006: "The global growth cycle may be close to its peak."
So why did economic forecasts continue to be optimistic last year?
Even when Singapore officially went into recession in November last year, the Ministry of Trade and Industry was still forecasting the economy would grow by up to 2 percent or shrink by up to 1 percent this year. Now it expects the economy to shrink by 6 to 9 percent.
What are the moguls saying in Davos?
Here's George Soros
And here's Rupert Murdoch
News Corp chairman Rupert Murdoch says a big government stimulus packages will fail, as in the Great Depression when only world war saved the U.S.economy, reports Reuters.
Speaking as a co-chairman of this year's World Economic Forum in Davos, Switzerland, the publishing magnate warned decision makers not to act too hastily in crafting attempts to solve the global financial crisis.
George Soros voiced concerns about the details of current bank rescue plans, reports Reuters.
"It needs a good bank/bad bank solution, but I would do it differently than what is proposed," the Hungarian-born speculator-turned philanthropist said.
"I would keep the capital of the banks together with the bad assets in the bad bank and then create a new bank with the good assets of the bank and the recapitalise that, giving the shareholders the right to put in more money," he said.
"Without this the banks will not lend, because they know there is a lot of deterioration coming."