Thread: US falls to 5th in global competitiveness, survey shows

US falls to 5th in global competitiveness, survey shows
Huge deficits and lack of faith in government push nation down the list

AP
By JOHN HEILPRIN
updated 9/7/2011 9:54:05 AM ET

GENEVA — The U.S. has tumbled further down a global ranking of the world's most competitive economies, landing at fifth place because of its huge deficits and declining public faith in government, a global economic group said Wednesday.

The announcement by the World Economic Forum was the latest bad news for the Obama administration, which has been struggling to boost the sinking U.S. economy and lower an unemployment rate of more than 9 percent.

Switzerland held onto the top spot for the third consecutive year in the annual ranking by the Geneva-based forum, which is best known for its exclusive meeting of luminaries in Davos, Switzerland, each January.

Singapore moved up to second place, bumping Sweden down to third. Finland moved up to fourth place, from seventh last year. The U.S. was in fourth place last year, after falling from No. 1 in 2008.

The rankings, which the forum has issued for more than three decades, are based on economic data and a survey of 15,000 business executives.

The forum praised the U.S. for its productivity, highly sophisticated and innovative companies, excellent universities and flexible labor market. But it also cited "a number of escalating weaknesses" such as rising government debt and declining public faith in political leaders and corporate ethics.

The results of a survey of 142 nations comes a day before Obama is preparing to tackle jobs issues in a speech to the U.S. Congress, and just as U.S. polls show a clear majority of those surveyed say they disapprove of the way Obama is handling the economy.

Switzerland held onto its top ranking, the forum said, because of "continuing strong performance across the board" with innovation, technological readiness, even-handed regulation and having one of the world's most stable economic environments.

Germany, Europe's economic powerhouse, was sixth, followed by the Netherlands and Denmark. Japan came in ninth, and Britain was 10th. France was 18th, and Greece, saddled with debt, fell to 90th.

The report looked at broader trends: While the U.S. slipped, emerging markets gained traction. China took 26th place, highest among major emerging economies; Brazil was 53rd; India was 56th; and Russia was 66th.

"Fiscal imbalances that have been building up around the world are really a danger to future competitiveness, in terms of the ability of countries to invest in those things that will be very important for competitiveness going forward, things like education, infrastructure and so on," said Jennifer Blanke, an economist with the forum.

Source: http://www.msnbc.msn.com/id/44423519/ns ... me-mNTVqhk

the latest bad news for the Barack Hussein Obama administration



1) Switzerland

2) Singapore

3) Sweden

4) Finland

5) United States

http://www3.weforum.org/docs/WEF_GCR_Report_2011-12.pdf

Mexico Moves Up Competitiveness Rankings

--Sharp advances in financial market development, goods market

--Mexico lags in crime and security, labor flexibility

--Index helps to show progress, deficiencies in public policies

By Anthony Harrup

Of DOW JONES NEWSWIRES

MEXICO CITY (Dow Jones)--Mexico moved up eight places in the World Economic Forum's Global Competitiveness Report with big gains in the evaluation of financial and goods markets, although the country continued among the stragglers in labor and crime issues.

Mexico ranked 58th out of 142 countries included in the 2011-2012 WEF report published Wednesday, compared with 66th a year ago, and its overall score rose to 4.3 from 4.2.

Jose Antonio Torre, deputy minister for competitiveness and norms at the Economy Ministry, said in an interview that beyond the actual ranking, the index provides an objective external view of where progress is and isn't being made, and how the results of public policies are being reflected in the view of businesses.

The number of businesses in Mexico that completed the survey increased to 382 this year from 94 the previous year, covering a wider geographical area and bigger range of different-sized firms.

"The value of the index has a lot to do with the messages behind it," Torre said. Mexico's rating for development of financial markets--up 13 places to position 83--reflects to a large extent government efforts to increase lending to small and medium-sized businesses through its loan guarantee programs.

Small and medium-sized companies may not even know that they received the credit because of a government guarantee, but the fact they have noted greater availability of credit is a reflection of a government policy, Torre said.

"The ranking is important...but more important is what's behind it, the analysis of the tendencies, opinions of businesses," he added.

Mexico advanced in 10 of the 12 categories measured by the World Economic Forum, only falling in macroeconomic environment, which had a lot to do with a change in methodology, Mexican officials said. The biggest jump was in innovation, to 63rd from 78th.

Where Mexico continues to lag, despite moving up a few positions, is in institutions, which include regulatory burdens, organized crime and security, dispute settlement, and others, and in labor market efficiency.

Numerous proposals for labor reform have been submitted in Congress, among them seeking ways to make hiring and firing easier, although so far there has been no political agreement for passing reform. "Giving greater flexibility in hiring and terminating contracts generates employment," Torre said.

More progress also needs to be made in simplifying the entry of informal businesses into the formal economy by removing barriers, and helping those businesses to see that there are more benefits being in the formal economy, Torre said. "There has been progress, but not at the speed we would like."

-By Anthony Harrup, Dow Jones Newswires; (5255) 5980-5176, anthony.harrup@dowjones.com

http://online.wsj.com/article/BT-CO-201 ... 14289.html