Switzerland is More Attractive than the United States

Competitiveness

According to a World Economic Forum study, Switzerland currently has the world’s most competitive economy. In the report’s rankings, Switzerland improved from second place last year, changing places with the United States. The World Economic Forum report, which was published on Tuesday in Geneva, indicated that the Swiss economy is distinguished by great innovational strength and a highly developed business culture. The World Economic Forum is a meeting of leading representatives from politics and business, and is held annually in Davos, Switzerland.

The Forum report said that the United States fell to second place in large measure because its financial markets and macroeconomic stability have deteriorated. Singapore, Sweden and Denmark are ranked third, fourth, and fifth, respectively. And with Finland, Germany and the Netherlands in the next three positions, European countries once again figure prominently in the top ten. Great Britain, despite sustained high competitiveness, continues last year’s decline and fell from twelfth to thirteenth place. The reason for this is primarily the prolonged weakness of the British financial market.

Praise for German Corporate Culture

The report describes German corporate culture as “very highly developed.” Only in Japan is this culture even better. The overly rigid labor market is a hindrance for Germany’s economic development. It ranked quite poorly in the 124th position. From the point of view of Margareta Drzeniek, a senior economist at the World Economic Forum, the protections from wrongful dismissal should be relaxed. This could encourage job creation. To increase competitiveness, the World Economic Forum experts also advise tax cuts. Germany is in 90th place with the high total tax burden, and the efficiency of the tax system ranks even worse in 106th place.

Columbia University economics professor Xavier Sala-i-Martin, one of the authors of the report, urged a policy of not losing sight of the long term foundations of competitiveness despite the short term pressure of the current crisis.

China Solidly Among the 30 Best Countries

Furthermore, China is the most competitive among the most important developing countries. The People’s Republic improved one position over the past year, and strengthened its position within the top 30 countries. Brazil and India also improved their positions, whereas Russia dropped twelve spots.

The report said that Swiss research institutions rank among the best, with high expenditures for research and development. In addition, the Swiss government institutions are among the most efficient and most transparent in the world. With respect to efficiency, the Swiss labor market is surpassed only by Singapore, according to the study. Furthermore, the problems in the Swiss banking sector are not as serious as in other countries.

The competition index is based on twelve criteria of competitiveness, which convey a comprehensive picture of the competition landscape in countries at all stages of development all over the world. Among other things examined in this competition index were infrastructure, health care, education, training and the developmental stage of the financial markets and technology in 133 countries.