TEMPO.CO, Jakarta - The newly-launched The Global Competitiveness Report 2016-2017, issued by the World Economic Report lists Indonesia as dropping four places to number 41. It lags behind Singapore, Malaysia and Thailand, among the ASEAN member countries ranked by the Global Competitiveness Index (GCI). In Asia, India is listed as the highest rising economy, climbing to 16 places.
The report, an annual assesment of factors driving productivity and prosperity in 138 countries, finds a worrying decline in the openness of economies worldwide. “Declining openness in the global economy is harming competitiveness and making it harder for leaders to drive sustainable, inclusive growth,” said Klaus Schwab, Founder and Executive Chairman, World Economic Forum.
The degree to which economies are open to international trade in goods and services is directly linked to both economic growth and a nation’s innovative potential. The trend, which is based on perception data from the Global Competitiveness Index (GCI)’s Executive Opinion Survey, is gradual and attributed mainly to a rise in non-tariff barriers although three other factors are also taken into account: burdensome customs procedures, rules affecting foreign investment and foreign ownership.
The competitiveness gap in East Asia and Pacific, said the report, is widening. Although 13 of the 15 economies covered have been able to improve their GCI scores over the past decade, this year sees reversals for some of the larger emerging markets in the region: Malaysia drops out of the top twenty, falling seven places to 25; Thailand drops two to 34; Indonesia falls 4 places to 41 while the Philippines drops ten to 57.
A consistent theme for all the region’s developing countries is the need to make inroads into the more complex areas of competitiveness related to business sophistication and innovation if they are to break out of the middle-income trap.
Switzerland continues to be the top ranked, followed by Singapore and the United States. The other top ten rankings go to European countries.
TEMPO