Ireland moves up three places in competitiveness rankings
World Economic Forum’s latest survey paints mixed picture of Ireland’s economy
Construction workers build a waterfront apartment block, operated by Skai Holdings LLC, on Palm Jumeirah artificial island in Dubai, United Arab Emirates. Photographer: Gilles Ledos/Bloomberg
Ireland has moved up three places in the global rankings in the World Economic Forum’s latest competitiveness survey.
The survey assesses countries against 12 “pillars of competitiveness”, including macro-economic environment, education and training, labour market efficiency, technological readiness and infrastructure.
The report attempts to paint a picture of what is driving competitiveness in 144 states under review.
Within the various categories, Ireland’s rankings vary widely.
The State is ranked first in the area of low annual inflation - ironically seen by many analysts as a threat to recovery.
In terms of its macro-economic environment, Ireland is ranked way down in 130th position, with report noting the State’s high level of public debt and its sizeable government deficit.
Ireland scores highly, however, in the pillar covering technological readiness - coming 12th overall, but second when it came to adopting new technology, and first in terms of foreign direct investment (FDI) bringing new technology into the country.
However, in the category of financial market development, Ireland is near the bottom of the rankings in terms of the soundness of its banks (139th) and ease of access to loans (117th).
Minister for Jobs, Enterprise and Innovation Richard Bruton welcomed the improvement in Ireland’s competitiveness. “By making it easier for Irish companies to do business in world markets, and more attractive for multinational companies to locate operations here, we can make a real difference to the level of
job-creation,” he said.
Overall, the forum’s report said the top-ranked countries had a number of factors in common.
“The leading economies in the index all possess a track record in developing, accessing and utilising available talent, as well as in making investments that boost innovation.”
“These smart and targeted investments have been possible thanks to a coordinated approach based on strong collaboration between the public and private sectors.”
Significantly, the report warns of a growing divide in Europe “between a highly competitive North and a lagging South and East persists”.
However, the report also suggests there was a new outlook on the European competitiveness divide between countries implementing reforms and those that are not can now also be observed.
In Europe, several countries that were severely hit by the economic crisis, such as Spain (35th), Portugal (36th) and Greece (81st), have made significant strides to improve the functioning of their markets and the allocation of productive resources, it said.
At the same time, some countries that continue to face major competitiveness challenges, such as France (23rd) and Italy (49th), appear not to have fully engaged in this process.
The forum also warns on the health of the global economy “despite years of bold monetary policy”, citing uneven implementation of structural reforms across different regions and levels of development as the biggest challenge to sustaining global growth.
“The strained global geopolitical situation, the rise of income inequality, and the potential tightening of the financial conditions could put the still tentative recovery at risk and call for structural reforms to ensure more sustainable and inclusive growth,” said Klaus Schwab, founder and executive chairman of the forum.