1.Insight ReportThe GlobalCompetitiveness Report20122013Klaus Schwab, World Economic Forum

2. Insight ReportThe GlobalCompetitiveness Report20122013Full Data EditionProfessor Klaus SchwabWorld Economic ForumEditorProfessor Xavier Sala-i-MartnColumbia UniversityChief Advisor of The Global Benchmarking Network 2012 World Economic Forum 3. The Global Competitiveness Report 201220013: World Economic ForumFull Data Edition is published by the World EconomicGenevaForum within the framework of The GlobalBenchmarking Network. Copyright 2012by the World Economic ForumProfessor Klaus SchwabAll rights reserved. No part of this publication may beExecutive Chairmanreproduced, stored in a retrieval system, or transmitted,in any form or by any means, electronic, mechanical,Professor Xavier Sala-i-Martnphotocopying, or otherwise without the prior permissionChief Advisor of The Global Benchmarking Networkof the World Economic Forum.Brge BrendeISBN-13: 978-92-95044-35-7Managing Director, Government Relations andISBN-10: 92-95044-35-5Constituents EngagementThis book is printed on paper suitable for recycling andmade from fully managed and sustained forest sources.THE GLOBAL BENCHMARKING NETWORKPrinted and bound in Switzerland by SRO-Kundig.Jennifer Blanke, Senior Director,Lead Economist, Head of The GlobalThe Report and an interactive data platform are availableBenchmarking Networkat www.weforum.org/gcr.Beat Bilbao-Osorio, Associate Director,Senior EconomistCiara Browne, Associate DirectorRoberto Crotti, Quantitative EconomistMargareta Drzeniek Hanouz, Director, SeniorEconomist, Head of Competitiveness ResearchBrindusa Fidanza, Associate Director,Environmental InitiativesThierry Geiger, Associate Director, EconomistTania Gutknecht, Community ManagerCaroline Ko, Junior EconomistCecilia Serin, Team CoordinatorWe thank Hope Steele for her excellent editing work andNeil Weinberg for his superb graphic design and layout.We are grateful to Annabel Guinault for her invaluableresearch assistance.The terms country and nation as used in this report donot in all cases refer to a territorial entity that is a stateas understood by international law and practice. Theterms cover well-defined, geographically self-containedeconomic areas that may not be states but for whichstatistical data are maintained on a separate andindependent basis. 2012 World Economic Forum 4. ContentsPartner Institutes v Part 2: Data Presentation 79Prefacexiii2.1 Country/Economy Profiles81by Klaus SchwabHow to Read the Country/Economy Profiles ..................................83 Index of Countries/Economies ........................................................85 Country/Economy Profiles ..............................................................86Part 1: Measuring Competitiveness1 2.2 Data Tables 375 How to Read the Data Tables .......................................................3771.1 The Global Competitiveness Index 3 Index of Data Tables .....................................................................37920122013: Strengthening Recovery by Data Tables ..................................................................................381Raising Productivityby Xavier Sala-i-Martn, Beat Bilbao-Osorio, JenniferBlanke, Roberto Crotti, Margareta Drzeniek Hanouz, Technical Notes and Sources 519Thierry Geiger, and Caroline Ko About the Authors 5231.2 Assessing the Sustainable Competitiveness49of Nations Acknowledgments 527by Beat Bilbao-Osorio, Jennifer Blanke, Roberto Crotti,Margareta Drzeniek Hanouz, Brindusa Fidanza, ThierryGeiger, Caroline Ko, and Cecilia Serin1.3 The Executive Opinion Survey: The Voice69of the Business Communityby Ciara Browne, Thierry Geiger, and Tania Gutknecht The Global Competitiveness Report 20122013 | iii 2012 World Economic Forum 5. 2012 World Economic Forum 6. Partner InstitutesThe World Economic Forums Global Benchmarking Barbados Sir Arthur Lewis Institute of Social and Economic Studies,Network is pleased to acknowledge and thank University of West Indies (UWI)the following organizations as its valued PartnerJudy Whitehead, DirectorInstitutes, without which the realization of The Global BelgiumCompetitiveness Report 20122013 would not haveVlerick Business Schoolbeen feasible: Priscilla Boiardi, Associate, Competence Centre Entrepreneurship, Governance and StrategyAlbania Wim Moesen, ProfessorInstitute for Contemporary Studies (ISB) Leo Sleuwaegen, Professor, Competence CentreArtan Hoxha, President Entrepreneurship, Governance and StrategyElira Jorgoni, Senior ExpertEndrit Kapaj, Expert Benin CAPODConception et Analyse de Politiques deAlgeria DveloppementCentre de Recherche en Economie Applique pour Epiphane Adjovi, Directorle Dveloppement (CREAD) Maria-Odile Attanasso, Deputy CoordinatorYoucef Benabdallah, Assistant Professor Fructueux Deguenonvo, ResearcherYassine Ferfera, Director Bosnia and HerzegovinaArgentina MIT Center, School of Economics and Business in Sarajevo,IAEUniversidad Austral University of SarajevoEduardo Luis Fracchia, Professor Zlatko Lagumdzija, ProfessorSantiago Novoa, Project Manager Zeljko Sain, Executive DirectorArmeniaJasmina Selimovic, Assistant DirectorEconomy and Values Research Center BotswanaManuk Hergnyan, Chairman Botswana National Productivity CentreSevak Hovhannisyan, Board Member and Senior Associate Letsogile Batsetswe, Research Consultant and StatisticianGohar Malumyan, Research Associate Baeti Molake, Executive DirectorAustraliaPhumzile Thobokwe, Manager, Information and ResearchAustralian Industry GroupServices DepartmentColleen Dowling, Senior Research Coordinator BrazilInnes Willox, Chief Executive Fundao Dom Cabral, Bradesco Innovation CenterAustriaCarlos Arruda, International Relations Director, InnovationAustrian Institute of Economic Research (WIFO) and Competitiveness ProfessorKarl Aiginger, DirectorDaniel Berger, Bachelor Student in EconomicsGerhard Schwarz, Coordinator, Survey DepartmentFabiana Madsen, Economist and Associate Researcher Movimento Brasil Competitivo (MBC)Azerbaijan Carolina Aichinger, Project CoordinatorAzerbaijan Marketing Society Erik Camarano, Chief Executive OfficerFuad Aliyev, Deputy ChairmanAshraf Hajiyev, Consultant Brunei Darussalam Ministry of Industry and Primary ResourcesBahrain Pehin Dato Yahya Bakar, MinisterBahrain Economic Development Board Normah Suria Hayati Jamil Al-Sufri, Permanent SecretaryKamal Bin Ahmed, Minister of Transportation and Acting ChiefExecutive of the Economic Development BoardBulgariaNada Azmi, Manager, Economic Planning and DevelopmentCenter for Economic DevelopmentMaryam Matter, Coordinator, Economic Planning andAdriana Daganova, Expert, International Programmes andDevelopmentProjects Anelia Damianova, Senior ExpertBangladeshCentre for Policy Dialogue (CPD) Burkina FasoKhondaker Golam Moazzem, Senior Research Fellowlnstitut Suprieure des Sciences de la Population (ISSP),Kishore Kumer Basak, Research AssociateUniversity of OuagadougouMustafizur Rahman, Executive DirectorBaya Banza, Director The Global Competitiveness Report 20122013 | v 2012 World Economic Forum 7. Partner InstitutesBurundi CyprusUniversity Research Centre for Economic and SocialThe European UniversityDevelopment (CURDES), National University of BurundiBambos Papageorgiou, Head of Socioeconomic andBanderembako Deo, DirectorAcademic ResearchGilbert Niyongabo, Dean, Faculty of Economics &cdbbankThe Cyprus Development BankManagementMaria Markidou-Georgiadou, Manager, Business DevelopmentCambodiaand Special ProjectsEconomic Institute of CambodiaCzech RepublicSok Hach, PresidentCMC Graduate School of BusinessSokheng Sam, ResearcherTomas Janca, Executive DirectorCameroonDenmarkComit de Comptitivit (Competitiveness Committee)Danish Technological Institute, Center for Policy and BusinessLucien Sanzouango, Permanent Secretary DevelopmentCanadaHanne Shapiro, Center ManagerThe Conference Board of CanadaEcuadorMichael R. Bloom, Vice-President, OrganizationalESPAE Graduate School of Management, Escuela SuperiorEffectiveness & Learning Politcnica del Litoral (ESPOL)Douglas Watt, Associate DirectorElizabeth Arteaga, Project AssistantCape VerdeVirginia Lasio, DirectorINOVE RESEARCHInvestigao e Desenvolvimento, LdaSara Wong, ProfessorJlio Delgado, Partner and Senior ResearcherEgyptJos Mendes, Chief Executive OfficerThe Egyptian Center for Economic Studies (ECES)Sara Frana Silva, Project ManagerIman Al-Ayouty, Senior EconomistChadOmneia Helmy, Acting Executive Director and DirectorGroupe de Recherches Alternatives et de Monitoring du Projetof ResearchPtrole-Tchad-Cameroun (GRAMP-TC)EstoniaAntoine Doudjidingao, ResearcherEstonian Institute of Economic ResearchGilbert Maoundonodji, DirectorEvelin Ahermaa, Head of Economic Research SectorCeline Nnodji Mbaipeur, Programme OfficerMarje Josing, DirectorChile Estonian Development FundUniversidad Adolfo Ibez Kitty Kubo, Head of ForesightFernando Larrain Aninat, Director MBA Ott Prna, Chief Executive OfficerLeonidas Montes, Dean, School of GovernmentEthiopiaChina African Institute of Management, Development andInstitute of Economic System and Management, National GovernanceDevelopment and Reform Commission Zebenay Kifle, General ManagerChen Wei, Research Fellow Tegenge Teka, Senior ExpertDong Ying, ProfessorZhou Haichun, Deputy Director and Professor FinlandChina Center for Economic Statistics Research, TianjinETLAThe Research Institute of the Finnish EconomyMarkku Kotilainen, Research DirectorUniversity of Finance and EconomicsPetri Rouvinen, Research DirectorBojuan Zhao, ProfessorPekka Yl-Anttila, Managing DirectorFan Yang, Professor Jian Wang, Associate ProfessorHongye Xiao, ProfessorFranceLu Dong, ProfessorHEC School of Management, ParisBertrand Moingeon, Professor and Deputy DeanColombiaBernard Ramanantsoa, Professor and DeanNational Planning DepartmentSara Patricia Rivera, Advisor GabonJohn Rodrguez, Coordinator, Competitiveness ObservatoryConfdration Patronale GabonaiseJavier Villarreal, Enterprise Development DirectorRegis Loussou Kiki, General SecretaryGina Eyama Ondo, Assistant General SecretaryColombian Private Council on CompetitivenessHenri Claude Oyima, PresidentRosario Crdoba, PresidentMarco Llins, Vicepresident Gambia, TheGambia Economic and Social Development Research InstituteCte dIvoire (GESDRI)Chambre de Commerce et dIndustrie de Cte dIvoireMakaireh A. Njie, DirectorJean-Louis Billon, PresidentMamadou Sarr, Director GeneralGeorgiaBusiness Initiative for Reforms in GeorgiaCroatiaTamara Janashia, Executive DirectorNational Competitiveness CouncilGiga Makharadze, Founding Member of the Board of DirectorsJadranka Gable, AdvisorMamuka Tsereteli, Founding Member of the Board of DirectorsKresimir Jurlin, Research Fellowvi | The Global Competitiveness Report 20122013 2012 World Economic Forum 8. Partner InstitutesGermanyIrelandWHUOtto Beisheim School of Management Institute for Business Development and CompetitivenessRalf Fendel, Professor of Monetary Economics School of Economics, University College CorkMichael Frenkel, Professor, Chair of Macroeconomics andJustin Doran, Principal AssociateInternational EconomicsEleanor Doyle, Director Catherine Kavanagh, Principal AssociateGhanaAssociation of Ghana Industries (AGI)Forfs, Economic Analysis and Competitiveness DepartmentPatricia Addy, Projects OfficerAdrian Devitt, ManagerNana Owusu-Afari, PresidentConor Hand, EconomistSeth Twum-Akwaboah, Executive Director IsraelGreece Manufacturers Association of Israel (MAI)SEV Hellenic Federation of Enterprises Dan Catarivas, DirectorMichael Mitsopoulos, Senior Advisor, EntrepreneurshipAmir Hayek, Managing DirectorThanasis Printsipas, Economist, Entrepreneurship Zvi Oren, PresidentGuatemalaItalyFUNDESASDA Bocconi School of ManagementFelipe Bosch G., President of the Board of Directors Secchi Carlo, Full Professor of Economic Policy, BocconiPablo Schneider, Economic Director UniversityJuan Carlos Zapata, General ManagerPaola Dubini, Associate Professor, Bocconi University Francesco A. Saviozzi, SDA Professor, Strategic andGuinea Entrepreneurial Management DepartmentConfdration Patronale des Entreprises de GuineMohamed Bnogo Conde, Secretary-GeneralJamaica Mona School of Business (MSB), The University of the WestGuyana IndiesInstitute of Development Studies, University of Guyana Patricia Douce, Project AdministratorKaren Pratt, Research AssociateEvan Duggan, Executive Director and ProfessorClive Thomas, Director William Lawrence, Director, Professional Services UnitHaitiJapanGroup Croissance SAKeio UniversityPierre Lenz Dominique, Coordinator, Survey DepartmentYoko Ishikura, Professor, Graduate School of Media DesignKesner Pharel, Chief Executive Officer and ChairmanHeizo Takenaka, Director, Global Security Research Institute Jiro Tamura, Professor of Law, Keio UniversityHong Kong SARHong Kong General Chamber of CommerceKeizai Doyukai (Japan Association of Corporate Executives)David ORear, Chief EconomistKiyohiko Ito, Managing Director, Keizai DoyukaiFederation of Hong Kong Industries JordanAlexandra Poon, Director Ministry of Planning & International CooperationThe Chinese General Chamber of CommerceJordan National Competitiveness Team Kawther Al-Zoubi, Head of Competitiveness DivisionHungaryBasma Arabiyat, ResearcherKOPINT-TRKI Economic Research Ltd.Mukhallad Omari, Director of Policies and Studies Departmentva Palcz, Chief Executive OfficerPeter Vakhal, Project ManagerKazakhstan National Analytical CentreIcelandDiana Tamabayeva, Project ManagerInnovation Center IcelandVladislav Yezhov, ChairmanArdis Armannsdottir, Marketing ManagerKarl Fridriksson, Managing Director of Human Resources Kenyaand MarketingInstitute for Development Studies, University of NairobiThorsteinn I. Sigfusson, DirectorMohamud Jama, Director and Associate Research Professor Paul Kamau, Senior Research FellowIndiaDorothy McCormick, Research ProfessorConfederation of Indian Industry (CII)Chandrajit Banerjee, Director GeneralKorea, Republic ofMarut Sengupta, Deputy Director GeneralCollege of Business School, Korea Advanced Institute ofGantakolla Srivastava, Head, Financial ServicesScience and Technology KAIST Byungtae Lee, Acting DeanIndonesiaSoung-Hie Kim, Associate Dean and ProfessorCenter for Industry, SME & Business Competition Studies, Jinyung Cha, Assistant Director, Exchange ProgrammeUniversity of Trisakti Korea Development InstituteTulus Tambunan, Professor and Director Joohee Cho, Senior Research AssociateIran, Islamic Republic ofYongsoo Lee, Head, Policy Survey UnitThe Center for Economic Studies and Surveys (CESS), Iran KuwaitChamber of Commerce, Industries, Mines and Agriculture Kuwait National Competitiveness CommitteeMohammad Janati Fard, Research Associate Adel Al-Husainan, Committee MemberHamed Nikraftar, Project Manager Fahed Al-Rashed, Committee ChairmanFarnaz Safdari, Research Associate Sayer Al-Sayer, Committee Member The Global Competitiveness Report 20122013 | vii 2012 World Economic Forum 9. Partner InstitutesKyrgyz RepublicMaltaEconomic Policy Institute Bishkek ConsensusCompetitive MaltaFoundation for National CompetitivenessLola Abduhametova, Program Coordinator Margrith Lutschg-Emmenegger, Vice PresidentMarat Tazabekov, ChairmanAdrian Said, Chief Coordinator Caroline Sciortino, Research CoordinatorLatviaStockholm School of Economics in RigaMauritaniaKarlis Kreslins, EMBA Programme Director Centre dInformation Mauritanien pour le DveloppementAnders Paalzow, Rector Economique et Technique (CIMDET/CCIAM) L Abdoul, Consultant and AnalystLebanon Mehla Mint Ahmed, DirectorBader Young Entrepreneurs Program Habib Sy, Administrative Agent and AnalystAntoine Abou-Samra, Managing DirectorFarah Shamas, Program CoordinatorMauritius Board of Investment of MauritiusLesotho Nirmala Jeetah, Director, Planning and PolicyPrivate Sector Foundation of Lesotho Ken Poonoosamy, Managing DirectorO.S.M. Moosa, PresidentThabo Qhesi, Chief Executive Officer Joint Economic CouncilNteboheleng Thaele, Researcher Raj Makoond, DirectorLibyaMexicoLibya Development Policy CenterCenter for Intellectual Capital and CompetitivenessYusser Al-Gayed, Project DirectorErika Ruiz Manzur, Executive DirectorAhmed Jehani, Chairman Ren Villarreal Arrambide, President and Chief ExecutiveMohamed Wefati, Director Officer Rodrigo David Villarreal Ramos, DirectorLithuania Instituto Mexicano para la Competitividad (IMCO)Statistics Lithuania Priscila Garcia, ResearcherOna Grigiene, Deputy Head, Knowledge Economy Manuel Molano, Deputy General Director and Special Surveys Statistics Division Juan E. Pardinas, General DirectorVilija Lapeniene, Director GeneralGediminas Samuolis, Head, Knowledge EconomyMinistry of the Economy and Special Surveys Statistics Division Jose Antonio Torre, Undersecretary for Competitiveness and StandardizationLuxembourg Enrique Perret Erhard, Technical Secretary forLuxembourg Chamber of Commerce CompetitivenessChristel Chatelain, Research Analyst Narciso Suarez, Research Director, Technical SecretaryStephanie Musialski, Research Analyst for CompetitivenessCarlo Thelen, Chief Economist, Member of theManaging Board Moldova Academy of Economic Studies of Moldova (AESM)Macedonia, FYR Grigore Belostecinic, RectorNational Entrepreneurship and CompetitivenessCouncil (NECC) Centre for Economic Research (CER)Mirjana Apostolova, President of the AssemblyCorneliu Gutu, DirectorDejan Janevski, Project Coordinator MongoliaMadagascar Open Society Forum (OSF)Centre of Economic Studies, University of Antananarivo Munkhsoyol Baatarjav, Manager of Economic PolicyRavelomanana Mamy Raoul, DirectorErdenejargal Perenlei, Executive DirectorRazato Rarijaona Simon, Executive Secretary MontenegroMalawi Institute for Strategic Studies and Prognoses (ISSP)Malawi Confederation of Chambers of Commerce and Maja Drakic, Project Manager IndustryPetar Ivanovic, Chief Executive OfficerHope Chavula, Public Private Dialogue ManagerVeselin Vukotic, PresidentChancellor L. Kaferapanjira, Chief Executive Officer MoroccoMalaysia Comit National de lEnvironnement des AffairesInstitute of Strategic and International Studies (ISIS)Seloua Benmbarek, Head of MissionJorah Ramlan, Senior Analyst, Economics MozambiqueSteven C.M. Wong, Senior Director, Economics EconPolicy Research Group, Lda.Mahani Zainal Abidin, Chief Executive Peter Coughlin, DirectorMalaysia Productivity Corporation (MPC)Donaldo Miguel Soares, ResearcherMohd Razali Hussain, Director GeneralEma Marta Soares, AssistantLee Saw Hoon, Senior Director NamibiaMali Institute for Public Policy Research (IPPR)Groupe de Recherche en Economie Applique et Graham Hopwood, Executive DirectorThorique (GREAT)Massa Coulibaly, Executive Directorviii | The Global Competitiveness Report 20122013 2012 World Economic Forum 10. Partner InstitutesNepalPortugalCentre for Economic Development and Administration (CEDA)PROFORUM, Associao para o Desenvolvimento daRamesh Chandra Chitrakar, Professor, Country Coordinator Engenhariaand Project Director Ildio Antnio de Ayala Serdio, Vice President of the BoardMahendra Raj Joshi, Member of DirectorsHari Dhoj Pant, Officiating Executive Director, Advisor, Survey Frum de Administradores de Empresas (FAE)project Paulo Bandeira, General DirectorNetherlandsPedro do Carmo Costa, Member of the Board of DirectorsINSCOPE: Research for Innovation, Erasmus University Esmeralda Dourado, President of the Board of DirectorsRotterdam Puerto RicoFrans A. J. Van den Bosch, Professor Puerto Rico 2000, Inc.Henk W. Volberda, Director and Professor Ivan Puig, PresidentNew ZealandInstituto de Competitividad Internacional, UniversidadThe New Zealand Initiative Interamericana de Puerto RicoCatherine Harland, Research Fellow Francisco Montalvo, Project CoordinatorOliver Hartwich, Executive Director QatarNigeriaQatari Businessmen Association (QBA)Nigerian Economic Summit Group (NESG)Sarah Abdallah, Deputy General ManagerFrank Nweke Jr., Director GeneralIssa Abdul Salam Abu Issa, Secretary-GeneralChris Okpoko, Associate Director, Research Social and Economic Survey Research Institute (SESRI)Foluso Phillips, Chairman Hanan Abdul Ibrahim, Associate DirectorNorway Darwish Al Emadi, DirectorBI Norwegian Business School RomaniaEskil Goldeng, Researcher SC VBD Alliance Consulting SrlTorger Reve, Professor Irina Ion, Program CoordinatorOman Rolan Orzan, General DirectorThe International Research Foundation Russian FederationSalem Ben Nasser Al-Ismaily, Chairman Bauman Innovation & Eurasia Competitiveness InstitutePublic Authority for Investment Promotion and Export Katerina Marandi, Programme ManagerDevelopment (PAIPED) Alexey Prazdnichnykh, Principal and Managing DirectorMehdi Ali Juma, Expert for Economic Research Stockholm School of Economics, RussiaPakistan Igor Dukeov, Area PrincipalMishal PakistanCarl F. Fey, Associate Dean of ResearchPuruesh Chaudhary, Director Content RwandaAmir Jahangir, Chief Executive Officer Private Sector Federation (PSF)Paraguay Hannington Namara, Chief Executive OfficerCentro de Anlisis y Difusin de Economia ParaguayaAndrew O. Rwigyema, Head of Research and Policy(CADEP) Saudi ArabiaDionisio Borda, Research Member National Competitiveness Center (NCC)Fernando Masi, Director Awwad Al-Awwad, PresidentMara Beln Servn, Research Member Khaldon Mahasen, Vice PresidentPeru SenegalCentro de Desarrollo Industrial (CDI), Sociedad Nacional Centre de Recherches Economiques Appliques (CREA),de Industrias University of DakarNstor Asto, Project Director Diop Ibrahima Thione, DirectorLuis Tenorio, Executive Director SerbiaPhilippines Foundation for the Advancement of Economics (FREN)Makati Business Club (MBC) Mihail Arandarenko, DirectorMichael B. Mundo, Chief Economist Aleksandar Radivojevic, Project CoordinatorMarc P. Opulencia, Deputy Director Bojan Ristic, ResearcherPeter Angelo V. Perfecto, Executive DirectorManagement Association of the Philippines (MAP)SeychellesArnold P. Salvador, Executive Director Plutus Auditing & Accounting Services Nicolas Boulle, PartnerPoland Marco L. Francis, PartnerEconomic Institute, National Bank of PolandPiotr Boguszewski, Advisor SingaporeJarosaw T. Jakubik, Deputy Director Economic Development Board Anna Chan, Assistant Managing Director, Planning & Policy Cheng Wai San, Head, Research & Statistics Unit Teo Xinyu, Executive, Research & Statistics Unit Slovak Republic Business Alliance of Slovakia (PAS) Robert Kicina, Executive DirectorThe Global Competitiveness Report 20122013 | ix 2012 World Economic Forum 11. Partner InstitutesSlovenia ThailandInstitute for Economic ResearchSasin Graduate Institute of Business Administration,Peter Stanovnik, Professor Chulalongkorn UniversitySonja Uric, Senior Research Assistant Pongsak Hoontrakul, Senior Research Fellow Narudee Kiengsiri, President of Sasin Alumni AssociationUniversity of Ljubljana, Faculty of Economics Toemsakdi Krishnamra, Director of SasinMateja Drnovek, ProfessorAle Vahcic, Professor Thailand Development Research Institute (TDRI) Somchai Jitsuchon, Research DirectorSouth Africa Chalongphob Sussangkarn, Distinguished FellowBusiness Leadership South Africa Yos Vajragupta, Senior ResearcherFriede Dowie, DirectorThero Setiloane, Chief Executive Officer Timor-Leste East Timor Development Agency (ETDA)Business Unity South Africa Jose Barreto, Survey ManagerNomaxabiso Majokweni, Chief Executive Officer Palmira Pires, DirectorJoan Stott, Executive Director, Economic Policy Chambers of Commerce and Industry of Timor-LesteSpain Kathleen Fon Ha Tchong Goncalves, Vice-PresidentIESE Business School, International Center forCompetitivenessTrinidad and TobagoMara Luisa Blzquez, Research Associate Arthur Lok Jack Graduate School of BusinessAntoni Subir, Professor Miguel Carillo, Executive Director and Professor of Strategy Nirmala Harrylal, Director, Internationalisation and InstitutionalSri Lanka Relations CentreInstitute of Policy Studies of Sri Lanka (IPS)Ayodya Galappattige, Research OfficerThe Competitiveness CompanyDilani Hirimuthugodage, Research Officer Rolph Balgobin, ChairmanSaman Kelegama, Executive Director TunisiaSuriname Institut Arabe des Chefs dEntreprisesSuriname Trade & Industry Association (VSB)Ahmed Bouzguenda, PresidentHelen Doelwijt, Executive SecretaryMajdi Hassen, Executive CounsellorRene van Essen, Director TurkeyDayenne Wielingen Verwey, Economic Policy Officer TUSIAD Sabanci University Competitiveness ForumSwazilandIzak Atiyas, DirectorFederation of Swaziland Employers and Chamber of Selcuk Karaata, Vice DirectorCommerce Sezen Ugurlu, Project SpecialistMduduzi Lokotfwako, Research Analyst UgandaZodwa Mabuza, Chief Executive Officer Kabano Research and Development CentreNyakwesi Motsa, Administration & Finance Manager Robert Apunyo, Program ManagerSweden Delius Asiimwe, Executive DirectorInternational University of Entrepreneurship and TechnologyFrancis Mukuya, Research AssociateNiclas Adler, President UkraineSwitzerlandCASE Ukraine, Center for Social and Economic ResearchUniversity of St. Gallen, Executive School of Management,Dmytro Boyarchuk, Executive DirectorTechnology and Law (ES-HSG)Vladimir Dubrovskiy, Leading EconomistRubn Rodriguez Startz, Head of Project United Arab EmiratesTobias Trtsch, Communications Manager Abu Dhabi Department of Economic DevelopmentTaiwan, ChinaH.E. Mohammed Omar Abdulla, UndersecretaryCouncil for Economic Planning and Development, Executive Dubai Economic CouncilYuan H.E. Hani Al Hamly, Secretary GeneralHung, J. B., Director, Economic Research Department Institute for Social and Economic Research (ISER), ZayedShieh, Chung Chung, Researcher, Economic Research UniversityDepartment Mouawiya Alawad, DirectorWu, Ming-Ji, Deputy Minister Emirates Competitiveness CouncilTajikistan H.E. Abdulla Nasser Lootah, Secretary GeneralThe Center for Sociological Research ZerkaloRahima Ashrapova, Assistant Researcher United KingdomQahramon Baqoev, DirectorLSE Enterprise Ltd, London School of Economics andGulnora Beknazarova, ResearcherPolitical Science Adam Austerfield, Director of ProjectsTanzania Niccolo Durazzi, Project ManagerResearch on Poverty Alleviation (REPOA) Robyn Klingler Vidra, ResearcherCornel Jahari, Assistant ResearcherJohansein Rutaihwa, Commissioned ResearcherUruguaySamuel Wangwe, Professor and Executive DirectorUniversidad ORT Uruguay Isidoro Hodara, Professorx | The Global Competitiveness Report 20122013 2012 World Economic Forum 12. Partner InstitutesVenezuelaCONAPRIThe Venezuelan Council for Investment PromotionLitsay Guerrero, Economic Affairs and Investor Services ManagerEduardo Porcarelli, Executive DirectorVietnamHo Chi Minh City Institute for Development Studies (HIDS)Nguyen Trong Hoa, Professor and PresidentDu Phuoc Tan, Head of DepartmentTrieu Thanh Son, ResearcherYemenYemeni Businessmen Club (YBC)Mohammed Esmail Hamanah, Executive ManagerFathi Abdulwasa Hayel Saeed, ChairmanMoneera Abdo Othman, Project CoordinatorMARcon Marketing ConsultingMargret Arning, Managing DirectorZambiaInstitute of Economic and Social Research (INESOR),University of ZambiaPatricia Funjika, Research FellowJolly Kamwanga, Senior Research Fellow and ProjectCoordinatorMubiana Macwangi, Director and ProfessorZimbabweGraduate School of Management, University of ZimbabweA. M. Hawkins, ProfessorBolivia, Costa Rica, Dominican Republic, Ecuador,El Salvador, Honduras, Nicaragua, PanamaINCAE Business School, Latin American Center forCompetitiveness and Sustainable Development (CLACDS)Ronald Arce, ResearcherArturo Condo, RectorMarlene de Estrella, Director of External RelationsLawrence Pratt, DirectorLiberia and Sierra LeoneFJP Development and Management ConsultantsOmodele R. N. Jones, Chief Executive OfficerThe Global Competitiveness Report 20122013 | xi 2012 World Economic Forum 13. 2012 World Economic Forum 14. PrefaceKLAUS SCHWABExecutive Chairman, World Economic ForumThe Global Competitiveness Report 20122013 is being to recognize and encourage the qualitative as well asreleased amid a long period of economic uncertainty. the quantitative aspects of growth, integrating suchThe tentative recovery that seemed to be gaining groundconcepts as social and environmental sustainabilityduring 2010 and the first half of 2011 has given way to provide a fuller picture of what is needed and whatto renewed concerns. The global economy faces aworks. In this context, the Forums Global Benchmarkingnumber of significant and interrelated challenges that Network has continued to push forward with its researchcould hamper a genuine upturn after an economic crisis on how sustainability relates to competitiveness andhalf a decade long in much of the world, especiallyeconomic performance. To this end, Chapter 1.2 of thisin the most advanced economies. The persisting Report presents our evolving analysis of how countryfinancial difficulties in the periphery of the euro zone competitiveness can be assessed once issues ofhave led to a long-lasting and unresolved sovereignsocial and environmental sustainability are taken intodebt crisis that has now reached the boiling point. Theaccount. This represents an important area for the Worldpossibility of Greece and perhaps other countries leavingEconomic Forums research going forward.the euro is now a distinct prospect, with potentiallyThis years Report features a record number ofdevastating consequences for the region and beyond.144 economies, and thus continues to be the mostThis development is coupled with the risk of a weakcomprehensive assessment of its kind. It contains arecovery in several other advanced economies outside detailed profile for each of the economies included inof Europenotably in the United States, where politicalthe study as well as an extensive section of data tablesgridlock on fiscal tightening could dampen the growthwith global rankings covering over 100 indicators.outlook. Furthermore, given the expected slowdown in This Report remains the flagship publication within theeconomic growth in China, India, and other emergingForums Global Benchmarking Network, which producesmarkets, reinforced by a potential decline in global trade a number of research studies that mirror the increasedand volatile capital flows, it is not clear which regionsintegration and complexity of the world economy.can drive growth and employment creation in the shortThe Global Competitiveness Report 20122013to medium term.could not have been put together without the thoughtPolicymakers are struggling to find ways toleadership of Professor Xavier Sala-i-Martn at Columbiacooperate and manage the current economic challenges University, who has provided ongoing intellectualwhile preparing their economies to perform well in ansupport for our competitiveness research. Further,increasingly difficult and unpredictable global landscape. this Report would have not been possible without theAmid the short-term crisis management, it remainscommitment and enthusiasm of our network of over 150critical for countries to establish the fundamentals Partner Institutes worldwide. The Partner Institutes arethat underpin economic growth and development forinstrumental in carrying out the Executive Opinion Surveythe longer term. The World Economic Forum has, for that provides the foundation data of this Report as wellmore than three decades, played a facilitating role in as imparting the results of the Report at the nationalthis process by providing detailed assessments of thelevel. We would also like to convey our sincere gratitudeproductive potential of nations worldwide. The Reportto all the business executives around the world who tookcontributes to an understanding of the key factors thatthe time to participate in our Executive Opinion Survey.determine economic growth, helps to explain why some We are also grateful to the members of our Advisorycountries are more successful than others in raising Board on Competitiveness and Sustainability, whoincome levels and opportunities for their respective have provided their valuable time and knowledge topopulations, and offers policymakers and businesshelp us develop the framework on sustainability andleaders an important tool in the formulation of improved competitiveness presented in this Report: Jameseconomic policies and institutional reforms. Cameron, Chairman, Climate Change Capital; Dan Esty,The complexity of todays global economicCommissioner, Connecticut Department of Energy andenvironment has made it more important than ever Environmental Protection; Edwin J. Feulner Jr, President, The Global Competitiveness Report 20122013 | xiii 2012 World Economic Forum 15. PrefaceThe Heritage Foundation; Clment Gignac, Ministerof Natural Resources and Wildlife of Quebec; JeniKlugman, Director for Gender, The World Bank; Marc A.Levy, Deputy Director, CIESIN, Columbia University; JohnMcArthur, Senior Fellow, United Nations Foundation;Kevin X. Murphy, President and Chief Executive Officer,J.E. Austin Associates Inc.; Mari Elka Pangestu, Ministerof Tourism and Creative Economy of Indonesia; MarkSpelman, Global Head of Strategy, Accenture; andSimon Zadek, Senior Visiting Fellow, Global GreenGrowth Institute. Appreciation also goes to Brge Brende, ManagingDirector at the Forum, and Jennifer Blanke, Head ofThe Global Benchmarking Network, as well as teammembers Beat Bilbao-Osorio, Ciara Browne, RobertoCrotti, Margareta Drzeniek Hanouz, Thierry Geiger, TaniaGutknecht, Caroline Ko, and Cecilia Serin. Finally, wewould like to thank the Africa Commission and FedEx,our partners in this Report, for their support in thisimportant publication.xiv |The Global Competitiveness Report 20122013 2012 World Economic Forum 16. Part 1Measuring Competitiveness 2012 World Economic Forum 17. 2012 World Economic Forum 18. CHAPTER 1.1 At the time of releasing The Global CompetitivenessReport 20122013, the outlook for the world economyis once again fragile. Global growth remains historicallyThe Globallow for the second year running with major centers ofeconomic activityparticularly large emerging economiesCompetitiveness Index and key advanced economiesexpected to slow in201213, confirming the belief that the global economy20122013: Strengtheningis troubled by a slow and weak recovery. As in previousyears, growth remains unequally distributed. EmergingRecovery by Raising and developing countries are growing faster thanadvanced economies, steadily closing the income gap.ProductivityThe International Monetary Fund (IMF) estimatesthat, in 2012, the euro zone will have contracted byXAVIER SALA-I-MARTN0.3 percent, while the United States is experiencing aBEAT BILBAO-OSORIO weak recovery with an uncertain future. Large emergingJENNIFER BLANKE economies such as Brazil, the Russian Federation, India,ROBERTO CROTTIChina, and South Africa are growing somewhat lessMARGARETA DRZENIEK HANOUZ than they did in 2011. At the same time, other emergingTHIERRY GEIGERmarketssuch as developing Asiawill continue toCAROLINE KO show robust growth rates, while the Middle East andWorld Economic ForumNorth Africa as well as sub-Saharan African countriesare gaining momentum.Recent developmentssuch as the danger of aproperty bubble in China, a decline in world trade, andvolatile capital flows in emerging marketscould derailthe recovery and have a lasting impact on the globaleconomy. Arguably, this years deceleration to a largeextent reflects the inability of leaders to address themany challenges that were already present last year.Policymakers around the world remain concernedabout high unemployment and the social conditions intheir countries. The political brinkmanship in the UnitedStates continues to affect the outlook for the worldslargest economy, while the sovereign debt crises andthe danger of a banking system meltdown in peripheraleuro zone countries remain unresolved. The high levelsof public debt coupled with low growth, insufficientcompetitiveness, and political gridlock in some Europeancountries stirred financial markets concerns aboutsovereign default and the very viability of the euro.Given the complexity and the urgency of the situation,European countries are facing particularly difficulteconomic management decisions with challengingpolitical and social ramifications. Although Europeanleaders do not agree on how to address the immediatechallenges, there is recognition that, in the longer term,stabilizing the euro and putting Europe on a higherand more sustainable growth path will necessitateimprovements to the competitiveness of the weakermember states.All these developments are highly interrelatedand demand timely, decisive, and coordinated actionby policymakers. In light of these uncertain globalramifications, sustained structural reforms aimedat enhancing competitiveness will be necessary forThe Global Competitiveness Report 20122013 | 3 2012 World Economic Forum 19. 1.1: The Global Competitiveness Index 20122013countries to stabilize economic growth and ensure theThis open-endedness is captured within the GCIrising prosperity of their populations going into the future.by including a weighted average of many different Competitive economies drive productivitycomponents, each measuring a different aspect ofenhancements that support high incomes by ensuring competitiveness. These components are grouped into 12that the mechanisms enabling solid economicpillars of competitiveness (see Figure 1):performance are in place. For more than three decades, the World Economic First pillar: InstitutionsForums annual Global Competitiveness ReportsThe institutional environment is determined by the legalhave studied and benchmarked the many factorsand administrative framework within which individuals,underpinning national competitiveness. From the onset, firms, and governments interact to generate wealth. Thethe goal has been to provide insight and stimulate the importance of a sound and fair institutional environmentdiscussion among all stakeholders on the best strategies became even more apparent during the recent economicand policies to help countries to overcome the obstacles and financial crisis and is especially crucial for furtherto improving competitiveness. In the current challenging solidifying the fragile recovery given the increasing roleeconomic environment, our work is a critical reminder of played by the state at the international level and for thethe importance of structural economic fundamentals for economies of many countries.sustained growth. The quality of institutions has a strong bearing on Since 2005, the World Economic Forum hascompetitiveness and growth.4 It influences investmentbased its competitiveness analysis on the Global decisions and the organization of production and playsCompetitiveness Index (GCI), a comprehensive tool that a key role in the ways in which societies distribute themeasures the microeconomic and macroeconomic benefits and bear the costs of development strategiesfoundations of national competitiveness.1and policies. For example, owners of land, corporate We define competitiveness as the set of institutions, shares, or intellectual property are unwilling to invest inpolicies, and factors that determine the level ofthe improvement and upkeep of their property if theirproductivity of a country. The level of productivity, in rights as owners are not protected.5turn, sets the level of prosperity that can be earned byThe role of institutions goes beyond the legalan economy. The productivity level also determines the framework. Government attitudes toward marketsrates of return obtained by investments in an economy, and freedoms and the efficiency of its operationswhich in turn are the fundamental drivers of its growthare also very important: excessive bureaucracy andrates. In other words, a more competitive economy is red tape,6 overregulation, corruption, dishonesty inone that is likely to sustain growth.dealing with public contracts, lack of transparency and The concept of competitiveness thus involves static trustworthiness, inability to provide appropriate servicesand dynamic components. Although the productivity of for the business sector, and political dependence ofa country determines its ability to sustain a high level ofthe judicial system impose significant economic costsincome, it is also one of the central determinants of itsto businesses and slow the process of economicreturns to investment, which is one of the key factors development.explaining an economys growth potential. In addition, the proper management of public finances is also critical to ensuring trust in the nationalTHE 12 PILLARS OF COMPETITIVENESSbusiness environment. Indicators capturing the qualityMany determinants drive productivity and of government management of public finances arecompetitiveness. Understanding the factors behindtherefore included here to complement the measures ofthis process has occupied the minds of economistsmacroeconomic stability captured in pillar3 below.for hundreds of years, engendering theories ranging Although the economic literature has focused mainlyfrom Adam Smiths focus on specialization and theon public institutions, private institutions are also andivision of labor to neoclassical economists emphasis important element in the process of creating wealth.on investment in physical capital and infrastructure,2 The recent global financial crisis, along with numerousand, more recently, to interest in other mechanismscorporate scandals, have highlighted the relevance ofsuch as education and training, technological progress,accounting and reporting standards and transparencymacroeconomic stability, good governance, firm for preventing fraud and mismanagement, ensuring goodsophistication, and market efficiency, among others. governance, and maintaining investor and consumerWhile all of these factors are likely to be important forconfidence. An economy is well served by businessescompetitiveness and growth, they are not mutuallythat are run honestly, where managers abide by strongexclusivetwo or more of them can be significant at theethical practices in their dealings with the government,same time, and in fact that is what has been shown inother firms, and the public at large.7 Private-sectorthe economic literature.3transparency is indispensable to business, and can be brought about through the use of standards as well as4 | The Global Competitiveness Report 20122013 2012 World Economic Forum 20. 1.1: The Global Competitiveness Index 20122013auditing and accounting practices that ensure access to It is important to note that this pillar evaluatesinformation in a timely manner.8 the stability of the macroeconomic environment, so it does not directly take into account the way in whichSecond pillar: Infrastructurepublic accounts are managed by the government. ThisExtensive and efficient infrastructure is critical for qualitative dimension is captured in the institutions pillarensuring the effective functioning of the economy, asdescribed above.it is an important factor in determining the location ofeconomic activity and the kinds of activities or sectors Fourth pillar: Health and primary educationthat can develop in a particular instance. Well-developedA healthy workforce is vital to a countrysinfrastructure reduces the effect of distance betweencompetitiveness and productivity. Workers who areregions, integrating the national market and connecting it ill cannot function to their potential and will be lessat low cost to markets in other countries and regions. Inproductive. Poor health leads to significant costs toaddition, the quality and extensiveness of infrastructurebusiness, as sick workers are often absent or operate atnetworks significantly impact economic growth andlower levels of efficiency. Investment in the provision ofreduce income inequalities and poverty in a variety of health services is thus critical for clear economic, as wellways.9 A well-developed transport and communications as moral, considerations.11infrastructure network is a prerequisite for the access of In addition to health, this pillar takes into account theless-developed communities to core economic activities quantity and quality of the basic education received byand services.the population. Basic education increases the efficiencyEffective modes of transportincluding quality of each individual worker. Moreover, workers who haveroads, railroads, ports, and air transportenablereceived little formal education can carry out only simpleentrepreneurs to get their goods and services to manual tasks and find it much more difficult to adapt tomarket in a secure and timely manner and facilitatemore advanced production processes and techniques,the movement of workers to the most suitable jobs. and therefore contribute less to come up with or executeEconomies also depend on electricity supplies that are innovations. In other words, lack of basic educationfree of interruptions and shortages so that businesses can become a constraint on business development,and factories can work unimpeded. Finally, a solid with firms finding it difficult to move up the value chainand extensive telecommunications network allows forby producing more sophisticated or value-intensivea rapid and free flow of information, which increasesproducts with existing human resources.overall economic efficiency by helping to ensure thatFor the longer term, it will be essential to avoidbusinesses can communicate and decisions are madesignificant reductions in resource allocation to theseby economic actors taking into account all available critical areas, in spite of the fact that governmentrelevant information.budgets will need to be cut to reduce the deficits and debt burden.Third pillar: Macroeconomic environmentThe stability of the macroeconomic environment isFifth pillar: Higher education and trainingimportant for business and, therefore, is important forQuality higher education and training is particularlythe overall competitiveness of a country.10 Although crucial for economies that want to move up the valueit is certainly true that macroeconomic stability alonechain beyond simple production processes andcannot increase the productivity of a nation, it is also products.12 In particular, todays globalizing economyrecognized that macroeconomic instability harms therequires countries to nurture pools of well-educatedeconomy, as we have seen over the past years, notablyworkers who are able to perform complex tasks andin the European context. The government cannot adapt rapidly to their changing environment and theprovide services efficiently if it has to make high-interest evolving needs of the economy. This pillar measurespayments on its past debts. Running fiscal deficits limits secondary and tertiary enrollment rates as well asthe governments future ability to react to business the quality of education as evaluated by the businesscycles and to invest in competitiveness-enhancingcommunity. The extent of staff training is also taken intomeasures. Firms cannot operate efficiently when inflationconsideration because of the importance of vocationalrates are out of hand. In sum, the economy cannot grow and continuous on-the-job trainingwhich is neglectedin a sustainable manner unless the macro environment in many economiesfor ensuring a constant upgradingis stable. Macroeconomic stability has captured theof workers skills.attention of the public most recently when someEuropean countries needed the support of the IMF and Sixth pillar: Goods market efficiencyother euro zone economies to prevent sovereign default,Countries with efficient goods markets are wellas their public debt reached unsustainable levels. positioned to produce the right mix of products and services given their particular supply-and-demandThe Global Competitiveness Report 20122013 | 5 2012 World Economic Forum 21. 1.1: The Global Competitiveness Index 20122013conditions, as well as to ensure that these goods can Eighth pillar: Financial market developmentbe most effectively traded in the economy. HealthyThe recent economic crisis has highlighted the centralmarket competition, both domestic and foreign, is role of a sound and well-functioning financial sectorimportant in driving market efficiency and thus businessfor economic activities. An efficient financial sectorproductivity by ensuring that the most efficient firms, allocates the resources saved by a nations citizens, asproducing goods demanded by the market, are those well as those entering the economy from abroad, to theirthat thrive. The best possible environment for themost productive uses. It channels resources to thoseexchange of goods requires a minimum of impediments entrepreneurial or investment projects with the highestto business activity through government intervention. For expected rates of return rather than to the politicallyexample, competitiveness is hindered by distortionary orconnected. A thorough and proper assessment of risk isburdensome taxes and by restrictive and discriminatorytherefore a key ingredient of a sound financial market.rules on foreign direct investment (FDI)limiting foreignBusiness investment is also critical to productivity.ownershipas well as on international trade. TheTherefore economies require sophisticated financialrecent economic crisis has highlighted the degree ofmarkets that can make capital available for private-sectorinterdependence of economies worldwide and theinvestment from such sources as loans from a sounddegree to which growth depends on open markets. banking sector, well-regulated securities exchanges,Protectionist measures are counterproductive as theyventure capital, and other financial products. In order toreduce aggregate economic activity. fulfill all those functions, the banking sector needs to be Market efficiency also depends on demand trustworthy and transparent, andas has been madeconditions such as customer orientation and buyer so clear recentlyfinancial markets need appropriatesophistication. For cultural or historical reasons, regulation to protect investors and other actors in thecustomers may be more demanding in some countries economy at large.than in others. This can create an important competitiveadvantage, as it forces companies to be more innovative Ninth pillar: Technological readinessand customer-oriented and thus imposes the discipline In todays globalized world, technology is increasinglynecessary for efficiency to be achieved in the market.essential for firms to compete and prosper. Thetechnological readiness pillar measures the agility withSeventh pillar: Labor market efficiency which an economy adopts existing technologies toThe efficiency and flexibility of the labor market areenhance the productivity of its industries, with specificcritical for ensuring that workers are allocated to their emphasis on its capacity to fully leverage informationmost effective use in the economy and provided with and communication technologies (ICT) in daily activitiesincentives to give their best effort in their jobs. Labor and production processes for increased efficiencymarkets must therefore have the flexibility to shiftand enabling innovation for competitiveness.14 ICT hasworkers from one economic activity to another rapidly evolved into the general purpose technology of ourand at low cost, and to allow for wage fluctuations time,15 given the critical spillovers to the other economicwithout much social disruption.13 The importance of sectors and their role as industry-wide enablingwell-functioning labor markets has been dramaticallyinfrastructure. Therefore ICT access and usage are keyhighlighted by last years events in Arab countries, whereenablers of countries overall technological readiness.rigid labor markets were an important cause of high Whether the technology used has or has notyouth unemployment, sparking social unrest in Tunisia been developed within national borders is irrelevantthat then spread across the region. Youth unemploymentfor its ability to enhance productivity. The centralis also high in a number of European countries, where point is that the firms operating in the country needimportant barriers to entry into the labor market remainto have access to advanced products and blueprintsin place. and the ability to absorb and use them. Among theEfficient labor markets must also ensure a clearmain sources of foreign technology, FDI often playsrelationship between worker incentives and theira key role, especially for countries at a lower stage ofefforts to promote meritocracy at the workplace, andtechnological development. It is important to note that, inthey must provide equity in the business environmentthis context, the level of technology available to firms inbetween women and men. Taken together these factors a country needs to be distinguished from the countryshave a positive effect on worker performance and theability to conduct blue-sky research and develop newattractiveness of the country for talent, two aspects thattechnologies for innovation that expand the frontiersare growing more important as talent shortages loom onof knowledge. That is why we separate technologicalthe horizon.readiness from innovation, captured in the 12th pillar,described below.6 | The Global Competitiveness Report 20122013 2012 World Economic Forum 22. 1.1: The Global Competitiveness Index 20122013Tenth pillar: Market sizeTwelfth pillar: InnovationThe size of the market affects productivity since largeInnovation can emerge from new technological and non-markets allow firms to exploit economies of scale. technological knowledge. Non-technological innovationsTraditionally, the markets available to firms have are closely related to the know-how, skills, and workingbeen constrained by national borders. In the era ofconditions that are embedded in organizations andglobalization, international markets can to a certainare therefore largely covered by the eleventh pillar ofextent substitute for domestic markets, especially for the GCI. The final pillar of competitiveness focuses onsmall countries. Vast empirical evidence shows thattechnological innovation. Although substantial gainstrade openness is positively associated with growth. can be obtained by improving institutions, buildingEven if some recent research casts doubts on the infrastructure, reducing macroeconomic instability, orrobustness of this relationship, there is a general senseimproving human capital, all these factors eventuallythat trade has a positive effect on growth, especially seem to run into diminishing returns. The same is true forfor countries with small domestic markets.16 The casethe efficiency of the labor, financial, and goods markets.of the European Union illustrates the importance of theIn the long run, standards of living can be largelymarket size for competitiveness, as important efficiency enhanced by technological innovation. Technologicalgains were realized through closer integration. Although breakthroughs have been at the basis of many of thethe reduction of trade barriers and the harmonization of productivity gains that our economies have historicallystandards within the European Union have contributed experienced. These range from the industrial revolutionto raising exports within the region, many barriers to a in the 18th century and the invention of the steam enginetrue single market, in particular in services, remain in and the generation of electricity to the more recent digitalplace and lead to important border effects. Thereforerevolution. The latter is transforming not only the waywe continue to use the size of the national domestic and things are being done, but also opening a wider rangeforeign market in the Index. of new possibilities in terms of products and services. Thus exports can be thought of as a substitute forInnovation is particularly important for economies as theydomestic demand in determining the size of the marketapproach the frontiers of knowledge and the possibilityfor the firms of a country.17 By including both domestic of generating more value by only integrating andand foreign markets in our measure of market size, weadapting exogenous technologies tends to disappear.18give credit to export-driven economies and geographicAlthough less-advanced countries can still improveareas (such as the European Union) that are divided into their productivity by adopting existing technologiesmany countries but have a single common market.or making incremental improvements in other areas, for those that have reached the innovation stage ofEleventh pillar: Business sophistication development this is no longer sufficient for increasingThere is no doubt that sophisticated business practicesproductivity. Firms in these countries must designare conducive to higher efficiency in the production ofand develop cutting-edge products and processes togoods and services. Business sophistication concerns maintain a competitive edge and move toward higher-two elements that are intricately linked: the quality of a value-added activities. This progression requires ancountrys overall business networks and the quality of environment that is conducive to innovative activity andindividual firms operations and strategies. These factors supported by both the public and the private sectors. Inare particularly important for countries at an advancedparticular, it means sufficient investment in research andstage of development when, to a large extent, thedevelopment (R&D), especially by the private sector; themore basic sources of productivity improvements have presence of high-quality scientific research institutionsbeen exhausted. The quality of a countrys businessthat can generate the basic knowledge needed to buildnetworks and supporting industries, as measured by the new technologies; extensive collaboration in researchthe quantity and quality of local suppliers and the extent and technological developments between universitiesof their interaction, is important for a variety of reasons. and industry; and the protection of intellectual property,When companies and suppliers from a particular in addition to high levels of competition and accesssector are interconnected in geographically proximateto venture capital and financing that are analyzed ingroups, called clusters, efficiency is heightened, greater other pillars of the Index. In light of the recent sluggishopportunities for innovation in processes and products recovery and rising fiscal pressures faced by advancedare created, and barriers to entry for new firms are economies, it is important that public and private sectorsreduced. Individual firms advanced operations and resist pressures to cut back on the R&D spending thatstrategies (branding, marketing, distribution, advancedwill be so critical for sustainable growth going into theproduction processes, and the production of unique and future.sophisticated products) spill over into the economy andlead to sophisticated and modern business processesacross the countrys business sectors. The Global Competitiveness Report 20122013 | 7 2012 World Economic Forum 23. 1.1: The Global Competitiveness Index 20122013Figure 1: The Global Competitiveness Index frameworkGLOBAL COMPETITIVENESS INDEXBasic requirements Efficiency enhancersInnovation and sophistication subindex subindex factors subindex Pillar 1. InstitutionsPillar 5. Higher education and Pillar 11. Business sophistication training Pillar 2. Infrastructure Pillar 12. Innovation Pillar 6. Goods market efficiency Pillar 3. Macroeconomic environment Pillar 7. Labor market efficiency Pillar 4. Health and primary education Pillar 8. Financial market development Pillar 9. Technological readinessPillar 10. Market size Key forKey for Key forfactor-drivenefficiency-driven innovation-driveneconomieseconomieseconomiesNote: See the appendix for the detailed structure of the GCI.The interrelation of the 12 pillars best way for France to do so. This is because CambodiaWhile we report the results of the 12 pillars ofand France are in different stages of development: ascompetitiveness separately, it is important to keep countries move along the development path, wages tendin mind that they are not independent: they tend to to increase and, in order to sustain this higher income,reinforce each other, and a weakness in one area oftenlabor productivity must improve.has a negative impact in others. For example, a strongIn line with the economic theory of stages ofinnovation capacity (pillar12) will be very difficult to development, the GCI assumes that economies in theachieve without a healthy, well-educated and trainedfirst stage are mainly factor-driven and compete basedworkforce (pillars4 and 5) that is adept at absorbing newon their factor endowmentsprimarily low-skilled labortechnologies (pillar9), and without sufficient financing and natural resources.19 Companies compete on the(pillar8) for R&D or an efficient goods market that makesbasis of price and sell basic products or commodities,it possible to take new innovations to market (pillar6). with their low productivity reflected in low wages.Although the pillars are aggregated into a single index,Maintaining competitiveness at this stage of developmentmeasures are reported for the 12 pillars separately hinges primarily on well-functioning public and privatebecause such details provide a sense of the specificinstitutions (pillar1), a well-developed infrastructureareas in which a particular country needs to improve. (pillar2), a stable macroeconomic environment (pillar3),The appendix describes the exact composition of and a healthy workforce that has received at least athe GCI and technical details of its construction.basic education (pillar4).As a country becomes more competitive,STAGES OF DEVELOPMENT AND THE WEIGHTEDproductivity will increase and wages will rise withINDEX advancing development. Countries will then moveWhile all of the pillars described above will matter to a into the efficiency-driven stage of development, whencertain extent for all economies, it is clear that they willthey must begin to develop more efficient productionaffect them in different ways: the best way for Cambodiaprocesses and increase product quality becauseto improve its competitiveness is not the same as the wages have risen and they cannot increase prices. At8 | The Global Competitiveness Report 20122013 2012 World Economic Forum 24. 1.1: The Global Competitiveness Index 20122013Table1: Subindex weights and income thresholds for stages of developmentSTAGES OF DEVELOPMENTStage 1: Transition fromStage 2:Transition fromStage 3:Factor-drivenstage 1 to stage 2Efficiency-drivenstage 2 to stage 3 Innovation-driven GDP per capita (US$) thresholds* 17,000 Weight for basic requirements subindex60%4060% 40% 2040% 20% Weight for efficiency enhancers subindex35%3550% 50%50% 50% Weight for innovation and sophistication factors5%510% 10% 1030% 30%Note: See individual country/economy profiles for the exact applied weights.* For economies with a high dependency on mineral resources, GDP per capita is not the sole criterion for the determination of the stage of development. See text for details.this point, competitiveness is increasingly driven by Implementation of stages of developmenthigher education and training (pillar5), efficient goods Two criteria are used to allocate countries into stages ofmarkets (pillar6), well-functioning labor markets (pillar7),development. The first is the level of GDP per capita atdeveloped financial markets (pillar8), the ability tomarket exchange rates. This widely available measureharness the benefits of existing technologies (pillar9), is used as a proxy for wages, because internationallyand a large domestic or foreign market (pillar10). comparable data on wages are not available for allFinally, as countries move into the innovation-driven countries covered. The thresholds used are also shownstage, wages will have risen by so much that they are in Table1. A second criterion is used to adjust forable to sustain those higher wages and the associated countries that are wealthy, but where prosperity is basedstandard of living only if their businesses are able to on the extraction of resources. This is measured by thecompete with new and/or unique products, services,share of exports of mineral goods in total exports (goodsmodels, and processes. At this stage, companies and services), and assumes that countries that exportmust compete by producing new and different goods more than 70 percent of mineral products (measuredthrough new technologies (pillar 12) and/or the mostusing a five-year average) are to a large extent factorsophisticated production processes or business models driven.21(pillar 11). Any countries falling in between two of the threeThe GCI takes the stages of development intostages are considered to be in transition. For theseaccount by attributing higher relative weights to those countries, the weights change smoothly as a countrypillars that are more relevant for an economy given its develops, reflecting the smooth transition from oneparticular stage of development. That is, although allstage of development to another. This allows us12 pillars matter to a certain extent for all countries, theto place increasingly more weight on those areasrelative importance of each one depends on a countrysthat are becoming more important for the countrysparticular stage of development. To implement thiscompetitiveness as the country develops, ensuring thatconcept, the pillars are organized into three subindexes, the GCI can gradually penalize those countries thateach critical to a particular stage of development. are not preparing for the next stage. The classificationThe basic requirements subindex groups thoseof countries into stages of development is shown inpillars most critical for countries in the factor-drivenTable2.stage. The efficiency enhancers subindex includesthose pillars critical for countries in the efficiency-driven DATA SOURCESstage. And the innovation and sophistication factorsTo measure these concepts, the GCI uses statisticalsubindex includes the pillars critical to countries in thedata such as enrollment rates, government debt, budgetinnovation-driven stage. The three subindexes are shown deficit, and life expectancy, which are obtained fromin Figure1.internationally recognized agencies, notably the UnitedThe weights attributed to each subindex in everyNations Educational, Scientific and Cultural Organizationstage of development are shown in Table1. To obtain(UNESCO), the IMF, and the World Health Organizationthe weights shown in the table, a maximum likelihood(WHO). The descriptions and data sources of all theseregression of GDP per capita was run against each statistical variables are presented in the Technical Notessubindex for past years, allowing for different coefficientsand Sources at the end of this Report. Furthermore,for each stage of development.20 The rounding of thesethe GCI uses data from the World Economic Forumseconometric estimates led to the choice of weightsannual Executive Opinion Survey (Survey) to capturedisplayed in Table1. concepts that require a more qualitative assessmentor for which internationally comparable statistical dataThe Global Competitiveness Report 20122013 | 9 2012 World Economic Forum 25. 1.1: The Global Competitiveness Index 20122013Table 2: Countries/economies at each stage of development Stage 1: Transition fromStage 2:Transition from Stage 3: Factor-drivenstage 1 to stage 2 Efficiency-driven stage 2 to stage 3Innovation-driven (38 economies) (17 economies) (33 economies)(21 economies)(35 economies) Bangladesh AlgeriaAlbania Argentina Australia BeninAzerbaijan Armenia Bahrain Austria Burkina Faso BoliviaBosnia and HerzegovinaBarbadosBelgium BurundiBotswana BulgariaBrazilCanada Cambodia Brunei DarussalamCape VerdeChile Cyprus Cameroon EgyptChina Croatia Czech Republic Chad GabonColombiaEstonia Denmark Cte dIvoireHonduras Costa RicaHungary Finland Ethiopia Iran, Islamic rep. Dominican RepublicKazakhstanFrance Gambia, TheKuwait Ecuador LatviaGermany GhanaLibyaEl Salvador Lebanon Greece Guinea Mongolia Georgia Lithuania Hong Kong SAR HaitiPhilippinesGuatemala MalaysiaIceland IndiaQatarGuyanaMexicoIreland KenyaSaudi Arabia Indonesia OmanIsrael Kyrgyz RepublicSri LankaJamaica PolandItaly LesothoVenezuelaJordanRussian FederationJapan Liberia Macedonia, FYRSeychellesKorea, Rep. MadagascarMauritius Trinidad and Tobago Luxembourg MalawiMontenegroTurkeyMalta MaliMorocco Uruguay Netherlands MauritaniaNamibia New Zealand Moldova PanamaNorway MozambiqueParaguayPortugal Nepal PeruPuerto Rico Nicaragua Romania Singapore Nigeria SerbiaSlovak Republic PakistanSouth AfricaSlovenia RwandaSurinameSpain Senegal Swaziland Sweden Sierra LeoneThailandSwitzerland TajikistanTimor-Leste Taiwan, China TanzaniaUkraine United Arab Emirates UgandaUnited Kingdom Vietnam United States Yemen Zambia Zimbabweare not available for the entire set of economies. The (12th), the source has been changed to include dataSurvey process and the statistical treatment of data are based on the Patents Co-operations Treaty instead ofdescribed in detail in Chapter 1.3 of this Report. the US Patent and Trademark Office (USPTO), which had been used until now. These data are collectedADJUSTMENTS TO THE GCI and published jointly by the World Intellectual PropertyA few minor adjustments have been made to theOrganization and the Organisation for Economic Co-GCI structure this year. Within the macroeconomicoperation and Development (OECD). They record patentenvironment pillar (3rd), the interest rate spread has applications globally, not just in the United States,been removed from the Index because of limitations therefore eliminating a possible geographical bias.22in the international comparability of these data.Finally, the Rigidity of Employment Index was droppedFurthermore, mobile broadband was added to the from the labor market efficiency pillar (7th), as the Worldtechnological readiness (9th) pillar in order to take into Bank ceased to provide this indicator.23account the rapidly expanding access to the Internetvia mobile devices. And a variable capturing the extentCOUNTRY COVERAGEto which governments provide services to the businessThe coverage of this year has increased from 142 to 144community, which has been collected through theeconomies. The newly covered countries are Gabon,Executive Opinion Survey, was added to the institutionsGuinea, Liberia, Seychelles, and Sierra Leone. Libyapillar (1st). For the patent indicator in the innovation pillarwas re-included after a year of absence as we were10 | The Global Competitiveness Report 20122013 2012 World Economic Forum 26. 1.1: The Global Competitiveness Index 20122013not able to conduct the Survey because of civil unrestworld (5th). Governance structures ensure a level playingin 2011. Three previously covered countries had to be field, enhancing business confidence; these includeexcluded from this years Report. Survey data could not an independent judiciary, a strong rule of law, and abe collected in Belize and Angola; in Syria, the security highly accountable public sector. Competitivenesssituation did not allow the Survey to be carried out. In theis also buttressed by excellent infrastructure (5th),case of Tunisia we decided not to report the results this well-functioning goods markets (7th), and highlyyear because an important structural break in the datadeveloped financial markets (9th). Finally, Switzerlandsmakes comparisons with past years difficult. We hope to macroeconomic environment is among the most stablere-include these countries in the future. in the world (8th) at a time when many neighboringeconomies continue to struggle in this area.THE GLOBAL COMPETITIVENESS INDEX 20122013While Switzerland demonstrates many competitiveRANKINGSstrengths, maintaining its innovative capacity will requireTables 3 through 7 provide the detailed rankings of boosting university enrollment rate, which continues tothis years GCI. The following sections discuss the lag behind that of many other high-innovation countries,findings of the GCI 20122013 for the top performersalthough this has been increasing in recent years.globally, as well as for a number of selected economies Singapore retains its place at 2nd position asin each of the five following regions: Europe and North a result of an outstanding performance across theAmerica, Asia and the Pacific, Latin America and theentire Index. The country features in the top 3 inCaribbean, the Middle East and North Africa, and sub- seven of the 12 categories of the Index and appearsSaharan Africa. Box1 presents a comparative study of in the top 10 of three others. Its public and privatethe GCI results, highlighting the profound and persisting institutions are rated as the best in the world for thecompetitiveness divide across and within the differentfifth year in a row. It also ranks 1st for the efficiencyworld regions.of its goods and labor markets, and places 2nd interms of financial market development. Singapore alsoTop 10has world-class infrastructure (2nd), with excellentAs in previous years, this years top 10 remain dominated roads, ports, and air transport facilities. In addition,by a number of European countries, with Switzerland,the countrys competitiveness is reinforced by a strongFinland, Sweden, the Netherlands, Germany, and thefocus on education, which has translated into a steadyUnited Kingdom confirming their place among the improvement in the higher education and training pillarmost competitive economies. Along with the United (2nd) in recent years, thus providing individuals with theStates, three Asian economies also figure in top 10,skills needed for a rapidly changing global economy.with Singapore remaining the second-most competitiveFinland moves up one place since last year toeconomy in the world, and Hong Kong SAR and Japan reach 3rd position on the back of small improvementsplacing 9th and 10th. in a number of areas. Similar to other countries inSwitzerland retains its 1st place position again this the region, the country boasts well-functioning andyear as a result of its continuing strong performance highly transparent public institutions (2nd), toppingacross the board. The countrys most notableseveral indicators included in this category. Its privatestrengths are related to innovation and labor marketinstitutions, ranked 3rd overall, are also seen to beefficiency, where it tops the GCI rankings, as well as theamong the best run and most ethical in the world.sophistication of its business sector, which is rankedFinland occupies the top position both in the health2nd. Switzerlands scientific research institutions are and primary education pillar as well as the higheramong the worlds best, and the strong collaborationeducation and training pillar, the result of a strong focusbetween its academic and business sectors, combined on education over recent decades. This has providedwith high company spending on R&D, ensures that the workforce with the skills needed to adapt rapidly tomuch of this research is translated into marketable a changing environment and has laid the groundworkproducts and processes reinforced by strong intellectualfor high levels of technological adoption and innovation.property protection. This robust innovative capacity is Finland is one of the most innovative countries incaptured by its high rate of patenting per capita, forEurope, ranking 2nd, behind only Switzerland, on thewhich Switzerland ranks a remarkable 2nd worldwide. related pillar. Improving the countrys capacity to adoptProductivity is further enhanced by a business sector the latest technologies (ranked 25th) could lead tothat offers excellent on-the-job-training opportunities,important synergies that in turn could corroborate theboth citizens and private companies that are proactivecountrys position as one of the worlds most innovativeat adapting the latest technologies, and labor marketseconomies. Finlands macroeconomic environmentthat balance employee protection with the interests ofweakens slightly on the back of rising inflation (above 3employers. Moreover, public institutions in Switzerland percent), but fares comparatively well when contrastedare among the most effective and transparent in the with other euro-area economies. The Global Competitiveness Report 20122013 | 11 2012 World Economic Forum 27. 1.1: The Global Competitiveness Index 20122013Box 1: Competitiveness from above: The GCI heat map Figure 1: The GCI heat map GCI score* n [5.39,5.72] n [5.00,5.39[ n [4.60,5.00[ n [4.20,4.60[ n [3.80,4.20[ n [2.78,3.80[ n Not covered * The interval [x,y[ is inclusive of x but exclusive of y. Highest value; lowest value.Figure 1 identifies the competitiveness hotspots and thecompetitiveness divide within Europe. Indeed, the lack ofregions or countries with weak performance according to the competitiveness of several of its members is among the rootGlobal Competitiveness Index (GCI). The 10 best-performingcauses of the current difficulties in the euro zone (see Boxcountries are shaded dark red. The remaining countries2). The map also shows that within the European Union theare colored in intermediate tones moving from orange, the traditional distinction made between the 15 original memberssecond-best performing group, through yellow, light blue, and the 12 countries that joined after 2004 does not holdmedium blue, and dark blue; this last color identifies the least- from a competitiveness point of view.competitive nations according to the GCI. The map draws a mixed picture of Asia, too. ScatteredThe map reveals that the hotspots remain concentrated across the region, the Asian Tigers and Japan can bein Europe, North America, and a handful of advanced considered competitiveness hotspots. Within this group ofeconomies in Asia and the Pacific. Despite decades of brisk five advanced economies, Singapore, Hong Kong SAR, andeconomic growth in some developing regions (such as Latin Japan enter the top 10, and Taiwan (China), and the RepublicAmerica and Africa), the map reveals that the profoundof Korea rank only a few notches behind. The developingcompetitiveness gap of these regions with more advanced nations of Southeast Asia are not yet competitivenesseconomies persists. This competitiveness deficit in vastchampions, but their group performance is quite remarkable.swaths of the developing world raises questions about the Led by Malaysia, all these economies achieve a GCI scoresustainability of growth patterns.above 4.0, the theoretical average of the GCI, and none ofSub-Saharan Africa, for example, continues to face thethem falls into the lowest, dark-blue category. This contrastsbiggest competitiveness challenges of all regions (see Boxstarkly with the situation in South Asia, where best-5). As shown on the map, a vast majority of the continents performing India ranks a middling 59th and several countriescountries covered in this Report fall into the group of least-appear in dark blue, including Pakistan and Bangladesh.competitive economies (dark blue). Out of the regionsIn the Middle East and North Africa, Israel and the six32 countries included in the GCI, only Botswana, Gabon, members of the Gulf Cooperation Council perform strongly.Namibia, the Seychelles (medium blue), Mauritius, Rwanda, But elsewhere in the region, the lack of competitiveness of theand South Africa (light blue) are in the next higher categories.Levantine and North African countries is worrisome. Finally,With six of the ten best-performing countries, Northern the map also reveals that the BRICS do not form a uniformand Western Europe is a competitiveness hotspot. Thegroup in terms of competitiveness, as seen on the map whereassessment is considerably bleaker when looking atChina is the only member appearing in a relatively strongSouthern and Eastern Europe. On the map, the patchwork of yellow.colorsranging from dark red to medium bluereveals the12 | The Global Competitiveness Report 20122013 2012 World Economic Forum 28. 1.1: The Global Competitiveness Index 20122013Table 3: The Global Competitiveness Index 20122013 rankings and 20112012 comparisonsGCI 20122013 GCI 20122013Rank amongRank among Score GCI 20112012 GCI 20112012 Score GCI 20112012 GCI 20112012Country/EconomyRank/144(17) sample rank Country/EconomyRank/144 (17) sample rankSwitzerland 15.721 1 Ukraine 734.1473 82Singapore 25.672 2 Uruguay 744.1374 63Finland 35.553 4 Vietnam 754.1175 65Sweden45.534 3 Seychelles764.10 n/an/aNetherlands 55.505 7 Georgia 774.0776 88Germany 65.486 6 Romania 784.0777 77United States 75.477 5 Botswana794.0678 80United Kingdom85.45810 Macedonia, FYR804.0479 79Hong Kong SAR 95.41911 Croatia 814.0480 76Japan105.40 10 9 Armenia 824.0281 92Qatar115.38 1114 Guatemala 834.0182 84Denmark125.29 12 8 Trinidad and Tobago 844.0183 81Taiwan, China135.28 1313 Cambodia854.0184 97Canada 145.27 1412 Ecuador 863.9485101Norway 155.27 1516 Moldova 873.9486 93Austria165.22 1619 Bosnia and Herzegovina883.9387100Belgium175.21 1715 Albania 893.9188 78Saudi Arabia 185.19 1817 Honduras903.8889 86Korea, Rep.195.12 1924 Lebanon 913.8890 89Australia205.12 2020 Namibia 923.8891 83France 215.11 2118 Mongolia933.8792 96Luxembourg 225.09 2223 Argentina 943.8793 85New Zealand235.09 2325 Serbia953.8794 95United Arab Emirates 245.07 2427 Greece963.8695 90Malaysia 255.06 2521 Jamaica 973.8496107Israel 265.02 2622 Gambia, The 983.8397 99Ireland274.91 2729 Gabon 993.82 n/an/aBrunei Darussalam284.87 2828 Tajikistan 1003.8098105China294.83 2926 El Salvador1013.8099 91Iceland304.74 3030 Zambia 1023.80 100113Puerto Rico314.67 3135 Ghana1033.79 101114Oman 324.65 3232 Bolivia1043.78 102103Chile334.65 3331 Dominican Republic 1053.77 103110Estonia344.64 3433 Kenya1063.75 104102Bahrain354.63 3537 Egypt1073.73 105 94Spain364.60 3636 Nicaragua1083.73 106115Kuwait 374.56 3734 Guyana 1093.73 107109Thailand 384.52 3839 Algeria1103.72 108 87Czech Republic 394.51 3938 Liberia1113.71 n/an/aPanama 404.49 4049 Cameroon 1123.69 109116Poland 414.46 4141 Libya1133.68 n/an/aItaly424.46 4243 Suriname 1143.68 110112Turkey 434.45 4359 Nigeria1153.67 111127Barbados 444.42 4442 Paraguay 1163.67 112122Lithuania454.41 4544 Senegal1173.66 113111Azerbaijan 464.41 4655 Bangladesh 1183.65 114108Malta474.41 4751 Benin1193.61 115104Brazil 484.40 4853 Tanzania 1203.60 116120Portugal 494.40 4945 Ethiopia 1213.55 117106Indonesia504.40 5046 Cape Verde 1223.55 118119Kazakhstan 514.38 5172 Uganda 1233.53 119121South Africa 524.37 5250 Pakistan 1243.52 120118Mexico 534.36 5358 Nepal1253.49 121125Mauritius544.35 5454 Venezuela1263.46 122124Latvia 554.35 5564 Kyrgyz Republic1273.44 123126Slovenia 564.34 5657 Mali 1283.43 124128Costa Rica 574.34 5761 Malawi 1293.38 125117Cyprus 584.32 5847 Madagascar 1303.38 126130India594.32 5956 Cte dIvoire1313.36 127129Hungary604.30 6048 Zimbabwe 1323.34 128132Peru 614.28 6167 Burkina Faso 1333.34 129136Bulgaria 624.27 6274 Mauritania 1343.32 130137Rwanda 634.24 6370 Swaziland1353.28 131134Jordan 644.23 6471 Timor-Leste1363.27 132131Philippines654.23 6575 Lesotho1373.19 133135Iran, Islamic Rep. 664.22 6662 Mozambique 1383.17 134133Russian Federation 674.20 6766 Chad 1393.05 135142Sri Lanka684.19 6852 Yemen1402.97 136138Colombia 694.18 6968 Guinea 1412.90 n/an/aMorocco704.15 7073 Haiti1422.90 137141Slovak Republic714.14 7169 Sierra Leone 1432.82 n/an/aMontenegro 724.14 7260 Burundi1442.78 138140The Global Competitiveness Report 20122013 | 13 2012 World Economic Forum 29. 1.1: The Global Competitiveness Index 20122013Table 4: The Global Competitiveness Index 20122013SUBINDEXES Innovation andOVERALL INDEXBasic requirementsEfficiency enhancers sophistication factorsCountry/EconomyRankScore Rank Score RankScoreRank ScoreSwitzerland 1 5.7226.225 5.48 15.79Singapore 2 5.6716.341 5.65115.27Finland 3 5.5546.039 5.30 35.62Sweden4 5.5366.018 5.32 55.56Netherlands 5 5.50 105.927 5.35 65.47Germany 6 5.48 115.86 10 5.27 45.57United States 7 5.47 335.122 5.63 75.42United Kingdom8 5.45 245.514 5.50 95.32Hong Kong SAR 9 5.4136.143 5.54224.73Japan10 5.40 295.30 11 5.27 25.67Qatar11 5.3875.96 22 4.93155.02Denmark12 5.29 165.68 15 5.15125.24Taiwan, China13 5.28 175.67 12 5.24145.08Canada 14 5.27 145.716 5.41214.74Norway 15 5.2795.95 16 5.15165.00Austria16 5.22 205.63 19 5.01105.30Belgium17 5.21 225.52 17 5.09135.21Saudi Arabia 18 5.19 135.74 26 4.84294.47Korea, Rep.19 5.12 185.66 20 5.00174.96Australia20 5.12 125.75 13 5.20284.56France 21 5.11 235.52 18 5.04184.96Luxembourg 22 5.0985.96 24 4.87194.89New Zealand23 5.09 195.65 14 5.16274.60United Arab Emirates 24 5.0756.03 21 4.94254.64Malaysia 25 5.06 275.38 23 4.89234.70Israel 26 5.02 375.10 27 4.79 85.33Ireland27 4.91 355.11 25 4.85204.87Brunei Darussalam28 4.87 215.56 68 4.05623.64China29 4.83 315.25 30 4.64344.05Iceland30 4.74 305.27 36 4.54244.69Puerto Rico31 4.67 484.86 33 4.61264.64Oman 32 4.65 155.69 45 4.40443.91Chile33 4.65 285.35 32 4.63453.87Estonia34 4.64 265.47 31 4.63334.06Bahrain35 4.63 255.47 35 4.58533.74Spain36 4.60 365.11 29 4.67314.14Kuwait 37 4.56 325.21 75 3.98863.36Thailand 38 4.52 454.89 47 4.38553.72Czech Republic 39 4.51 444.89 34 4.59324.13Panama 40 4.49 504.83 50 4.36483.83Poland 41 4.46 614.66 28 4.69613.66Italy42 4.46 514.81 41 4.44304.24Turkey 43 4.45 574.75 42 4.42503.79Barbados 44 4.42 385.09 49 4.37383.97Lithuania45 4.41 494.84 46 4.38473.83Azerbaijan 46 4.41 564.76 67 4.05573.68Malta47 4.41 345.12 40 4.46463.85Brazil 48 4.40 734.49 38 4.52393.97Portugal 49 4.40 404.96 44 4.40374.01Indonesia50 4.40 584.74 58 4.20403.96Kazakhstan 51 4.38 474.86 56 4.24 1043.25South Africa 52 4.37 844.28 37 4.53423.94Mexico 53 4.36 634.64 53 4.31493.79Mauritius54 4.35 524.80 62 4.14633.63Latvia 55 4.35 544.79 48 4.37683.57Slovenia 56 4.34 395.05 55 4.25364.02Costa Rica 57 4.34 674.61 60 4.18354.04Cyprus 58 4.32 424.94 43 4.41513.77India59 4.32 854.26 39 4.48433.94Hungary60 4.30 554.78 52 4.32583.68Peru 61 4.28 694.57 57 4.23943.31Bulgaria 62 4.27 654.63 59 4.18973.30Rwanda 63 4.24 704.56 94 3.77603.66Jordan 64 4.23 664.61 70 4.03523.74Philippines65 4.23 804.35 61 4.17643.60Iran, Islamic Rep. 66 4.22 594.69 90 3.81773.46Russian Federation 67 4.20 534.79 54 4.26 1083.16Sri Lanka68 4.19 724.50 77 3.96413.96Colombia 69 4.18 774.40 63 4.13663.58Morocco70 4.15 684.60 79 3.94843.38Slovak Republic71 4.14 624.64 51 4.33743.50Montenegro 72 4.14 744.49 74 3.99693.57 (Contd.)14 | The Global Competitiveness Report 20122013 2012 World Economic Forum 30. 1.1: The Global Competitiveness Index 20122013Table 4: The Global Competitiveness Index 20122013 (contd.) SUBINDEXESInnovation andOVERALL INDEX Basic requirementsEfficiency enhancers sophistication factors Country/EconomyRankScore RankScoreRankScoreRank Score Ukraine73 4.14794.3565 4.11793.43 Uruguay74 4.13434.9173 4.00783.46 Vietnam75 4.11914.2271 4.02903.32 Seychelles 76 4.10464.8691 3.81873.36 Georgia77 4.07644.6387 3.84 1203.00 Romania78 4.07904.2264 4.12 1063.20 Botswana 79 4.06784.3889 3.82823.40 Macedonia, FYR 80 4.04714.5284 3.85 1103.13 Croatia81 4.04604.6872 4.01833.39 Armenia82 4.02764.4182 3.86983.29 Guatemala83 4.01884.2381 3.92703.56 Trinidad and Tobago84 4.01414.9583 3.85893.33 Cambodia 85 4.01974.1485 3.84723.53 Ecuador86 3.94754.42 100 3.68933.32 Moldova87 3.94934.1699 3.71 1312.85 Bosnia and Herzegovina 88 3.93814.3397 3.75993.28 Albania89 3.91874.2492 3.80 1133.11 Honduras 90 3.88 1014.08 102 3.66913.32 Lebanon91 3.88 1163.7966 4.06813.41 Namibia92 3.88824.33 105 3.64 1033.25 Mongolia 93 3.87924.1796 3.76 1123.11 Argentina94 3.87964.1586 3.84883.35 Serbia 95 3.87954.1588 3.83 1242.96 Greece 96 3.86984.1369 4.05853.37 Jamaica97 3.84 1143.8280 3.93803.41 Gambia, The98 3.83 1034.01 114 3.54543.74 Gabon99 3.82864.25 116 3.52 1392.64 Tajikistan100 3.80 1053.97 112 3.56763.46 El Salvador 101 3.80994.13 103 3.66 1073.16 Zambia102 3.80 1083.92 108 3.61673.57 Ghana 103 3.79 1123.8595 3.77 1023.27 Bolivia 104 3.78944.15 122 3.35 1003.28 Dominican Republic105 3.77 1113.8893 3.79 1053.25 Kenya 106 3.75 1233.6276 3.97563.68 Egypt 107 3.73 1103.91 101 3.67963.31 Nicaragua 108 3.73 1043.99 119 3.38 1163.05 Guyana109 3.73 1073.93 109 3.61713.54 Algeria 110 3.72894.22 136 3.08 1442.31 Liberia 111 3.71 1093.92 121 3.36593.67 Cameroon112 3.69 1153.80 111 3.57953.31 Libya 113 3.68 1024.06 131 3.19 1272.92 Suriname114 3.68834.29 124 3.32 1173.01 Nigeria 115 3.67 1303.5278 3.96733.53 Paraguay116 3.67 1063.94 110 3.59 1232.97 Senegal 117 3.66 1203.68 106 3.63653.59 Bangladesh118 3.65 1193.72 107 3.62 1222.98 Benin 119 3.61 1133.83 125 3.31 1113.12 Tanzania120 3.60 1223.65 113 3.55923.32 Ethiopia121 3.55 1183.74 123 3.33 1252.96 Cape Verde122 3.55 1004.08 128 3.22 1193.01 Uganda123 3.53 1323.48 104 3.66 1013.27 Pakistan124 3.52 1343.4198 3.71753.47 Nepal 125 3.49 1213.65 126 3.30 1332.82 Venezuela 126 3.46 1263.54 117 3.46 1352.78 Kyrgyz Republic 127 3.44 1283.52 118 3.40 1402.63 Mali128 3.43 1253.55 127 3.26 1143.11 Malawi129 3.38 1353.40 120 3.37 1093.16 Madagascar130 3.38 1293.52 132 3.18 1153.08 Cte dIvoire 131 3.36 1373.29 115 3.53 1212.99 Zimbabwe132 3.34 1273.53 135 3.08 1282.90 Burkina Faso133 3.34 1333.45 129 3.22 1262.94 Mauritania134 3.32 1243.60 142 2.88 1183.01 Swaziland 135 3.28 1313.49 130 3.21 1342.80 Timor-Leste 136 3.27 1173.78 138 2.97 1362.73 Lesotho 137 3.19 1363.32 137 3.05 1372.72 Mozambique138 3.17 1383.22 133 3.10 1302.89 Chad139 3.05 1393.15 141 2.91 1292.89 Yemen 140 2.97 1413.01 139 2.95 1412.50 Guinea141 2.90 1432.80 134 3.10 1322.82 Haiti 142 2.90 1403.02 143 2.76 1432.41 Sierra Leone143 2.82 1442.77 140 2.94 1382.69 Burundi 144 2.78 1422.94 144 2.56 1422.42Note: Ranks out of 144 economies and scores measured on a 1-to-7 scale.The Global Competitiveness Report 20122013 | 15 2012 World Economic Forum 31. 1.1: The Global Competitiveness Index 20122013Table 5: The Global Competitiveness Index 20122013: Basic requirements PILLARS 3. Macroeconomic 4. Health andBASIC REQUI