Southeast Asia Just Got A Bit More Competitive
May 29, 2019

Four out of ten countries of the Association of Southeast Asian Nations, or ASEAN, improved their ranking in this year’s World Competitiveness Ranking compiled by International Institute for Management Development of Switzerland, one of the most recognised such lists.

The ranking, established in 1989, is analysing four key factors to determine weaknesses and strengths of a country, namely its economic performance, infrastructure, business efficiency and government efficiency. It incorporates 235 indicators from 63 surveyed countries and takes into account a wide range of “hard” statistics such as unemployment, gross domestic product and government spending on health and education, as well as “soft” data from an executive opinion survey, covering topics such as social cohesion, globalization and corruption.

The region’s biggest improvement in competitiveness was made by Indonesia, which leaped 11 ranks to 32nd place over 2018, more than any of its peers in Asia-Pacific thanks to improvements in government efficiency, infrastructure and business conditions.

Thailand has moved up five places to the 30th position in the ranking due to improved economic performance, government efficiency and infrastructure. Improved business legislation was highlighted in the criterion of government efficiency, he said, even while business efficiency actually dropped.

The Philippines was up four notches to rank 46, according to the ranking. The country improved in all four key factors, and its tax policy and labour market were ranked among the best in the world. However, all other indicators such as basic infrastructure, health and environment, education, scientific infrastructure, business legislation and international trade were placed rather unfavourable and show that the Philippines has a lot of catching-up to do.

Singapore ranked as the world’s most competitive economy for the first time since 2010, knocking out the US from the top spot to 3rd place amid higher fuel prices, weaker hi-tech exports and fluctuations in the value of the US dollar.

Malaysia was placed on rank 22, unchanged from the previous year.

The top five in the overall ranking were Singapore, Hong Kong, US, Switzerland and the United Arab Emirates. Hong Kong held on to 2nd place, helped by a benign tax and business policy environment and access to business finance.

Other countries in Asia-Pacific were listed as follows: China (14th), Taiwan (16th), Australia (18th), New Zealand (21st), South Korea (27th), Japan (30th), India (43rd) and Mongolia (62nd).