The World Economic Forum has just released its latest Global Competitiveness Report - it sees the U.S. falling to 6th place just behind Switzerland, Finland, Sweden, Denmark, and Singapore.

The WEF rankings represent potential competitiveness and attempt to indicate where a country is headed and are influenced by ’soft’ items such as infrastructure, macroeconomics and health care. While the WEF report praises the US as having highly efficient markets, good universities and high levels of innovation, it also expresses concern about health, primary education and debt levels.

Perhaps the World Economic Forum should have chosen a word other than “competitiveness” in its report, as that word usually denotes the ability to sell goods and services in a given market. And, by the generally accepted definition of competition, the top exporting countries and presumably the most competitive are Germany, U.S., China, Japan and France. Reference: Is There a Good Measure of Competitiveness?

The fly in the ointment of European competitiveness is labor costs, which translates into price competitiveness. Labor rates in Europe are not expected to decrease in the near-term, and so price competitiveness should remain unchanged.    

Global Competitiveness Report 2006-2007 - WEF

This entry was posted on Saturday, March 31st, 2007 at 2:41 am and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.