Qatar ranked 2nd in The Global Competitiveness Report in the Arab World and 18th Globally

28 Sep 2016 .

QBA Members attended

The Global Competitiveness Report, issued yearly by the World Economic Forum (WEF); has announced that the State of Qatar has been globally ranked 18 this year and comes in Second place in the Arab World after The United Arab Emirates and ahead of Saudi Arabia which is ranked 29, Kuwait 38, France 21, Malaysia 25 and Austria 19

the Qatari Businessmen Association (QBA) along with Qatar University, specifically the Social and Economic Research institute (SESRI) have been the local strategic partners of WEF in Qatar, where Throughout 11 consecutive years, Qatari Businessmen Association worked with WEF to highlight the strengths of the local economy, especially with respect to the investment climate and opportunities in all areas. Where the two institutes had put massive efforts to distribute, follow up and collect the survey questionnaire, which is designed to capture a broad range of factors affecting the economy expressed by the views of the business community, and to deliver a comprehensive overview of the main strengths and weaknesses in the national economy

The report is an annual assessment of the factors driving productivity and prosperity in 138 countries. The degree to which economies are open to international trade in goods and services is directly linked to both economic growth and a nation’s innovative potential. The trend, which is based on perception data from the Global Competitiveness Index (GCI)’s Executive Opinion Survey, is gradual and attributed mainly to a rise in non-tariff barriers although three other factors are also taken into account; burdensome customs procedures; rules affecting FDI and foreign ownership. It is most keenly felt in the high and upper middle income economies

“Declining openness in the global economy is harming competitiveness and making it harder for leaders to drive sustainable, inclusive growth,” said Klaus Schwab, Founder and Executive Chairman, World Economic Forum.

The report also sheds light on why quantitative easing and other monetary policy measures have been insufficient in reigniting long-term growth for the world’s advanced economies. The report finds that interventions by economies with comparatively low GCI scores failed to generate the same effect as those performed in economies with high scores, suggesting that strong underlying competitiveness is a key requirement for successful monetary stimulus.

The report offers insight into how priorities may be shifting for nations in earlier stages of development. While basic drivers of competitiveness such as infrastructure, health, education and well-functioning markets will always be important, data in the GCI suggests that a nation’s performance in terms of technological readiness, business sophistication and innovation is now as important in driving competitiveness and growth.

The Report shows this year that Qatar occupied rank 18 globally and second in the Arab World. based on the methodology of the report which depends on 12 different pillars measuring different aspects of competitiveness such as Institutions, Macroeconomic Environment, innovation and others; Qatar occupied this year the first Rank in the Wastefulness of Government Spending as part of the “Institutions Pillar”, also the first rank in Government Budget balance, Gross National Savings and inflation rates as part of the “Macroeconomic Environment Pillar”.

Qatar also occupies this year the First Rank in regard to the effect of taxation on incentives to work as part of the “Labor market efficiency pillar” and finally the country also occupies the first Rank in venture capital availability as part of the “financial market development Pillar”

According to the Study, Qatar also occupies Rank 18 in the Innovation and Sophistication factors where the United Arab Emirates Ranked 21; as for Primary Education and Health Qatar Ranked 27 and Saudi Arabia is Ranked 51 and Finally Qatar occupies rank 21 in regards to the Financial market development pillar where the United Arab Emirates Ranked 28. This comes in addition to Qatar’s Security stability in a region which the report described as instable politically

For the eighth consecutive year, Switzerland ranks as the most competitive economy in the world, narrowly ahead of Singapore and the United States. Following them is Netherlands and then Germany. The latter has climbed four places in two years. The next two countries, Sweden (6) and the United Kingdom (7) both advance three places, with the latter’s GCI score being based on pre-Brexit data. The remaining three economies in the top ten; Japan (8), Hong Kong SAR (9) and Finland (10) all move backwards.

While European economies continue to dominate the top ten, there remains no end in sight for the region’s persisting north-south divide. Spain improves by one-point climbing to 32, however Italy drops back one place to 44 and Greece reverses 5 places to 86. France, the Eurozone’s second largest economy, climbs one place to 21. For all economies in Europe, maintaining and improving prosperity levels will depend heavily on their ability to harness innovation and the talents of their workforces.

There is some sign of convergence in the competitiveness of the world’s largest emerging markets. China, on 28, remains top among the BRICS grouping although another surge by India – which climbs 16 places to 39 – means there is now less of a gap between it and its peers. With both Russia and South Africa moving up two places to 43 and 47 respectively only Brazil is declining, falling six places to 81.

The competitiveness gap in East Asia and Pacific, meanwhile, is widening. Although 13 of the 15 economies covered consecutively since 2007 have been able to improve their GCI score over the past decade, this year sees reversals for some of the larger emerging markets in the region: Malaysia drops out of the top twenty, falling seven places to 25; Thailand drops two to 34; Indonesia falls 4 places to 41 while the Philippines drops ten to 57. A consistent theme for all the region’s developing countries is the need to make inroads into the more complex areas of competitiveness related to business sophistication and innovation if they are to break out of the middle-income trap.

The drop in energy prices has heightened the urgency of advancing competitiveness agendas across the Arab world. With three economies in the top thirty; the United Arab Emirates (16); Qatar (18); and Saudi Arabia (29) there remains a clear need for all energy-exporting nations to further diversify their economies and for much greater effort to improve basic competitiveness among the region’s energy-importing nations

Two countries in Latin America and the Caribbean make it into this year’s top 50. Chile, the outlier in the region on 33, climbs two places although the gap is closing with the second highest ranked economy, Panama (up 8 places to 42). Next comes Mexico which performs strongly with a 6-point climb to 51. Argentina and Colombia, the third and fourth largest economies in the region, rank 104 and 61 respectively.

One of the most improved nations in sub-Saharan Africa is Rwanda, which rises 6 places to 52. It is closing in on the region’s traditionally most competitive economies, Mauritius and South Africa, although both these countries register more modest improvements, climbing to 45 and 47 respectively. Lower down the ranking, Kenya climbs to 96, Ethiopia holds steady at 109 while Nigeria slips three to 127.