Emerging economies continued to rise in the annual “Global Competitiveness List” of the World Economic Forum, while the decline of the United States became more pronounced. Turkey, which ranks among the world’s top 20 economies, again displayed a disappointing performance.

Releasing its “Global Competitiveness Report” on Wednesday, the World Economic Forum, or WEF, announced that Switzerland topped the list of 142 countries for a second year in a row. Singapore rose one spot to become the second most competitive economy, followed by Sweden and Finland.

The United States ranked fifth, falling one step compared to last year’s list. The rise of emerging economies, especially those in Asia, was visible in the list, but Western powers continued to dominate the top 20, which included five emerging economies. The top 10 was dominated by the economies of Western Europe.

Turkey was ranked down at number 59, having climbed two steps since last year. However, it was overtaken by dozens of other economies such as Oman, Puerto Rico, Tunisia, Sri Lanka, Azerbaijan and Slovenia. The ranking contrasts with a highly dynamic economy worth around $750 billion, a per capita income of $10,400 and a 1.29 percent share in global trade.

Turkey has been hovering around the 60th position over the past few years, a ranking in line with the performance of the so-called BRICS economies – with the exception of China, which stands at number 26.

Mixed performance from economies of BRICS

“We have seen some progress as Turkey was 63rd in 2008 and now it is 59th,” said WEF economist Margareta Drzeniek in an interview with the Hürriyet Daily News. “At the same time, the performance of the BRICS – Brazil, Russia, India, China and South Africa - was more mixed over this time period. Russia, for example moved from 51st to 66th, Brazil from 64th to 53rd, India from 50th to 56th, and South Africa from 45th to 50th.”

On average, emerging markets have been catching up with advanced economies over the past five years in terms of competitiveness, according to Drzeniek. “As competitiveness is a key determinant of future growth, this means that the shift in economic activity is likely to continue going forward,” she said.

Turkey performed best in the “market size” subcategory, ranking as the 17th most competitive economy in this area. Its worst performance was in “the effectiveness of the labor force” category, in which the nation ranked a dismal 133rd. According to WEF, the most pressing issues for businesses in Turkey are high taxes, red tape, the tax code and the qualification of the labor force.

“Emerging and developing economies must ensure that growth is based on productivity enhancements,” said economist Xavier Sala-i-Martin, co-author of the report. “Advanced economies, many of which struggle with fiscal challenges and anaemic growth, need to focus on competitiveness-enhancing measures in order to create a virtuous cycle of growth and ensure solid economic recovery.”

The report’s competitiveness ranking is based on the “Global Competitiveness Index.” The index comprises 12 categories that aim to provide a comprehensive picture of a country’s competitiveness. They are listed as institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market development, technological readiness, market size, business sophistication and innovation. The rankings are calculated from publicly available data and the “Executive Opinion Survey,” which polled over 14,000 business leaders worldwide this year.

/Hurriyet Daily News/