What We Think

May 28, 2020

Chart of the Week (22) - Competitiveness

A competitive economy is a productive one. Productivity leads to growth, which leads to improved income levels and drives human development. Enhancing competitiveness will be all the more critical now, as countries and companies transform themselves to survive and thrive in these changing times.

The Global Competitiveness Index 2019 presented by the World Economic Forum offers insights into the economic prospects of 141 economies by integrating well established levers that drive productivity and growth. 

With a score of 84.8 out of 100, Singapore is the country closest to the frontier of competitiveness.  Among the G20 economies, the United States (2nd, down 1 place), Japan (6th), Germany (7th, down 4) and the United Kingdom (9th, down 1) feature in the top 10, but they all have experienced erosion in their performance. Led by Singapore, the East Asia and the Pacific region is the most competitive in the world, followed by Europe and North America. Vietnam (67th) is the country whose score improved the most globally.

Malta, with an overall score of 68.5, ranks 38th place on the global competitiveness scoreboard, down two places in compared to 2018. The country registers better performance than the average of European and North American countries in terms of ICT adoption particularly when it comes to internet and cellular connectivity, macroeconomic stability where Malta obtains the maximum score on the back of low inflation and strong public finances, and in healthcare as has been amply demonstrated during this public health crisis.  

In other areas, notably business dynamism and innovation capabilities, Malta is found lagging behind the average of European and North American countries. Issues related to the time required to start a business, insufficient growth of innovative companies and the low levels of R&D continue to weigh heavily on the respective scores achieved. As has already been highlighted in last week's chart edition, these issues are becoming a common theme for Malta's economic progress and inventiveness. It is therefore crucial for Malta to act on these areas if it wants to stay in its league and become a global hub for knowledge based industries and high value added sectors.

 

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