Peter Griffin, Editor. 16 June 2022, 10:41 am
New Zealand has suffered the biggest drop in rankings among 63 nations compared on measures of their competitiveness, including in technology, science and business productivity.
The 2022 IMD World Competitiveness Ranking, sees Denmark take the lead for the first time with the top ten list dominated by small advanced nations such as Switzerland (2nd), Singapore (3rd), Sweden (4th) and Hong Kong (5th). In contrast, New Zealand slumped to 31st position from 20th in 2021, the largest drop by a country ranked by the IMD.
It bases the rankings on an analysis of 333 competitiveness criteria across four factors – economic performance, government efficiency, business efficiency and infrastructure, puts our dramatic drop down to “short term policy thinking, short term societal (non-political) thinking” and “slow transition of habits (consumption) and industry (investment) to low carbon economy”.
“This short-term issue prioritization may lead to the neglect of long-term trends, such as those related to environmental sustainability which could have a severe global impact,” said José Caballero, Senior Economist at the WCC.
The IMD World Competitiveness Rankings
New Zealand dropped in all competitiveness rankings. We ranked 46th for technological infrastructure and 27th for scientific infrastructure, while our track record on productivity and efficiency landed us in 48th place.
Australia improved to 19th place from 22nd place last year, despite performing poorly in some categories such as entrepreneurship (61st), science graduates (52nd), communication technologies (47th) and high-tech value-added (45th).
“Denmark is the most digitally advanced country in the world and now takes the top spot thanks to good policies, advantages afforded by being a European country, a clear focus on sustainability and a push from its agile corporate sector,” said Professor Arturo Bris, the WCC’s Director.
Countries had been hit by the impacts of the pandemic in varying ways which were reflected in the rankings, but some countries had chosen to invest through the turmoil of Covid-19, particularly in productivity and progress towards shifting towards a lower-carbon economy.
Slipping on most measures
The IMD data echoes the results of the Network Readiness Index (NRI), an international benchmark that shows we dropped from 16th to 20th place between 2020 and 2021. We ranked 42nd in the world for overall access to technology, 56th on cyber security, 62nd for high-tech exports and 69th on medium and high-tech manufacturing.
So where do we do well? New Zealand holds onto its reputation as performing well when it comes to our “societal framework” (14th) health and environment (16th) employment (17th) and business legislation (17th).
International competitiveness indexes are seen as useful indicators of where to pursue trade, partnerships and investments. Our diminished rankings may represent the distraction of Covid and the huge effort required to respond to it.