China shoots up in global competitiveness ranking as US tumbles at start of Trump era
Hong Kong and Singapore top the rankings, with the US down to 4th behind Switzerland
The US fell out of the top three in a global competitiveness ranking, as executives’ perception of the world’s biggest economy deteriorated after Donald Trump’s election.
The US slipped one spot to fourth in an annual ranking published by the IMD World Competitiveness Centre, a research group at IMD business school in Switzerland. It trails Hong Kong, Singapore and Switzerland. The US last took top spot in the 2015 ranking.
Meanwhile the US’s closest economic rival is gaining ground. China climbed seven places to 18th overall, topping the list of countries with per-capita gross domestic product of less than US$20,000, followed by Asian peers Malaysia and Thailand.
The results are based on 261 indicators, with about two-thirds coming from so-called “hard data,” gathered mainly last year, such as employment and trade statistics. The balance came from more than 6,250 executive-opinion surveys conducted this year. The report ranks 63 economies based on a sliding scale, with 100 being the most competitive.
The US drop largely reflects survey results, as global executives questioned by IMD ranked the country lower in categories including government and business efficiency. Respondents saw a greater risk of political instability and protectionism, which offset the country’s progress in reducing unemployment and stabilising inflation, according to the report.
“I was puzzled about the United States, to be honest, because it’s usually pretty consistently in the top three,” said Jose Caballero, senior economist at the IMD World Competitiveness Centre. “It’s obvious that there is an increasing negative perception about the country,” he said when asked whether Trump’s election factored into the drop. The survey strives to remain politically neutral, he added.
Caballero said next year’s report will provide a better look at the Trump’s impact on the country’s competitive standing, as it will include both survey results and hard data from his time in office. His administration’s efforts to roll back regulations and cut taxes also may benefit the US ranking, as executives rated the government’s competency and tax regime low in a list of the American economy’s advantages.
Venezuela was last among 63 economies in the overall ranking, after a year marred by political upheaval and recession.