Belgium is stable in the World Economic Forum 2013 ranking
Results of the Global Competitiveness Report 2013-2014 of the World Economic Forum
As the Belgian partner in the annual WEF ranking of most competitive countries Vlerick Business School is responsible for the survey of Belgian business managers. The ranking is based on an extensive survey of more than 13,000 business managers in 144 countries, combined with various objective data measuring each country’s competitive strength.
The World Economic Forum’s (WEF) ‘Global Competitiveness Report 2013-2014’ reveals that Belgium is stably ranked as the 17th most competitive country in the world. Last year we slipped two places, after having reached the 15th position, the highest ranking Belgium had ever achieved.
During the past 7 years Belgium fluctuated between 20th place (in 2006 and 2007), 18th place (2009) and 19th place (2010). We have also managed to continue to be ahead of France, after the surpass in 2011. France this year continues to slip down the ladder from 21st to 23rd position. Belgium is however unable to close the gap with Germany (up the ladder to the 4th place) and the Netherlands (down to the 8th place after the 5th position reached in 2011).
Leo Sleuwaegen, Professor at Vlerick Business School, says: “The Global Competitiveness Index defines the long-run capacity for growth of a country. Belgium has maintained its 17th position in the global ranking. However, the growing gap with Germany, our main trading partner, has become a point of serious concern.”
Belgium owes its competitive economy mainly to its excellent healthcare and its primary education: the country is ranked third worldwide. We also perform well in terms of higher education and training: despite losing one position, Belgium is still in the top 5. Another element which contributes to our competitiveness is our business sophistication in general, where Belgium is still ranked 12th worldwide. Belgium also performs well in terms of goods market efficiency, where Belgium gained two positions, from 15 to 13. This progress is largely due to the quantity and quality of local suppliers, where Belgium is ranked 4th and 5th respectively. Belgium still performs well in terms of innovation despite the loss of three positions in 2013, from 11 to 14.
When it comes to the technological readiness category, after the drop of 11 positions of 2012, Belgium as gained back four places in 2013 (from 22 to 18). Two other factors which have affected our performance are labour market efficiency, where we lost ground (from 50th to 64th position) and financial market development, where Belgium’s ranking plummeted by 13 positions (from 31 to 44). The damage is somewhat limited in terms of macro-economic climate (from 66th to 69th position). Infrastructure gained two positions (from 21st to 19th) after the drop from 17 to 21 in 2012.
Leo Sleuwaegen, professor at Vlerick Business School, explains: “Belgium has markedly moved downwards for the pillars macro-economic environment and labour market efficiency, two pillars that also in the past pushed us down in the ranking. Heavy government involvement, the effect of taxation on incentives to work, and the lack of flexibility in hiring and firing practices continue to appear as the most problematic factors. From the positive side, progress has been made regarding institutions, infrastructure and technological readiness.”
Finally, if we look at the results from the perspective of businesses, then business in Belgium in 2013 is mainly hindered by restrictive labour regulations, tax rates and, in third place, the inefficient government bureaucracy. This year access to financing did not make it into the top 3 of factors which complicate life for businesses operating in Belgium.
As was the case in 2012 the biggest neighbouring countries continue to be more competitive than we are, with the exception of France. The Netherlands dropped three places in the ranking, leaving the top five and reaching the 8th position. Germany improved its position and reached the 4th position closing the gap with the top 3. Luxembourg remains stable in the 22nd position.
France continues losing ground, sliding 2 rungs down the ladder to 23, continuing a trend given that the country already lost ground (3 places) last year. Spain is ranked 35th, Italy 49th, Portugal 51st, and Greece is at the bottom end of the ranking, in 91st place (out of 144). This is largely due to the lack of a macro-economic balance, bad access to funding, a shrinking labour market and a lack of innovation.
Changes at the top
Switzerland maintained its first position for the fourth year in a row, while Singapore is once again ranked the second most competitive country worldwide. The Scandinavian countries continue to perform well in the ranking: Finland is 3rd, Sweden 6th, Denmark 15th and Norway 11th. After 4 years, the US managed to reverse the negative trend and reaches the 5th position, 2 rungs up from the all-time low 7th position reached in 2012. While the economy is getting back on track, the deleveraging process in the banking sector continues to show positive effects on the stability and efficiency of the country’s financial markets, improving from 31st three years ago to 10th this year in that pillar.
Ranking of most important countries in comparison with Belgium