U.S. most competitive economy — Report

GENEVA NOV. 13. The U.S. is the most competitive economy in the world according to the Global Competitiveness Report 2002-03 released by the World Economic Forum on Tuesday. This year the U.S. swaps positions with Finland, the top-ranked country last year.

The U.S. owes its high competitiveness mainly to its stellar performance on technology-related factors and a business environment that is conducive to entrepreneurship and risk taking.

Major Asian economies, namely China, India and Japan rank better in this year's report, which measures the comparative strengths and weaknesses of 80 national economies. "While a global recovery will lift all boats in the short term, there remain fundamental differences in the growth dynamics in the triad, making it much more likely for Europe, Japan and the U.S. to follow different growth paths in the medium and longer term,'' said Peter Cornelius, Chief Economist of the World Economic Forum.

"That the U.S. is ranked number one in the Growth Competitiveness Index and the Microeconomic Competitiveness Index should not lead to complacency for to maintain this leading position, the country has to resolve outstanding reform issues, especially the need to improve its governance system,'' he added.

Japan has moved up in the competitiveness rankings. Despite deterioration in its macroeconomic environment and negative perception of the quality of its public institutions, Japan's position rises in the overall Growth Competitiveness Index, with technology as the key driver, particularly in the area of technological innovation. Japan rose from 21st to 13th place.

The rankings show significant strengthening of China and India's competitive positions. Much of India's gains stem from its performance in technology and the quality of its macroeconomic environment, while China derives much of its ascent from improved perception of its public institutions.

China rose six places in the Growth Competitiveness Index to 33rd position.

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