Singapore has once again clinched the top spot in the IMD World Competitiveness 2024 rankings that launched in June 2024, showcasing remarkable performance across various competitiveness factors. The country has significantly improved its position in key areas, including government and business efficiency, as well as infrastructure, solidifying its status as the most competitive nation in the world.
Here's what we can learn from Singapore:
Significant Improvements in Government and Business Efficiency
Government Efficiency
In terms of government efficiency, Singapore has jumped from seventh to second place, thanks to adaptive policies, effective bureaucracy, and a top-ranking credit rating. Key data supporting these achievements include:
- Government Policy Adaptability: Singapore ranks first in the ability of its government to quickly and efficiently adjust policies.
- Bureaucratic Efficiency: The country also tops the charts in bureaucratic efficiency, reflecting how its administrative processes run smoothly with minimal hurdles.
- Credit Rating Index: Singapore secures the first position in the credit rating index, indicating economic stability and the government’s credibility in meeting financial obligations
Business Efficiency
Singapore has also seen significant improvements in business efficiency, rising from eighth to second place. The country has achieved top-five rankings in all relevant sub-factors. Key supporting data include:
- Overall Productivity (PPP): Singapore ranks at the top for overall productivity, indicating high economic output per unit of labor.
- Availability of Skilled Labor: The country is also first in the availability of skilled labor, a crucial factor for business growth and sustainability.
- Regulatory Compliance: Singapore ranks first in regulatory compliance, showing that businesses operate within a clear and orderly legal framework.
Additionally, executives in Singapore report improvements in several critical criteria, such as the private sector's priority on attracting and retaining highly skilled talent (ninth position), the level of labor force motivation (sixth position), and the efficiency of the SME sector (ninth position).
Strong Infrastructure
In terms of infrastructure, Singapore has made significant strides, rising to fourth place from ninth the previous year. Technological infrastructure is a standout area for Singapore, where it has secured the top position. Key supporting data include:
Technological Infrastructure: Singapore ranks first in technological infrastructure, reflecting excellent technological advancement and digital capacity.
However, there are some declines in health and environmental aspects, where Singapore has dropped from 26th to 28th place, indicating room for improvement in these areas.
Consistent Economic Performance
In the area of economic performance, Singapore remains in third place, demonstrating its economic resilience amidst global volatility. Key supporting data include:
- International Trade: Singapore holds the second position in international trade, indicating a strong position in global exports and imports.
- International Investment: The country also ranks second in international investment, up from fourth the previous year, showing a favorable environment for foreign investment.
- Employment: Despite a drop in employment ranking from second to fifth place, Singapore still shows strong performance in job creation and maintaining low unemployment rates.
Challenges to Address
Despite many achievements, Singapore faces some challenges that need to be addressed to maintain its status as the most competitive country in the world. Key data indicating these challenges include:
- Real GDP Growth per Capita: Singapore has seen a decline in real GDP growth per capita, falling from 59th to 63rd position.
- Government Debt: Total government debt as a percentage of GDP has decreased, from 61st to 65th position, indicating an increase in debt burden that needs to be managed.
- Health Expenditure: Total health expenditure as a percentage of GDP has dropped from 49th to 54th, reflecting a need for more attention in the health sector.
- GINI Coefficient: Singapore's economic inequality index has slightly worsened, dropping from 44th to 45th position, indicating that income disparity needs to be addressed.
- Stock Market Index: The stock market index has significantly declined from 28th to 46th, reflecting market volatility and potential investor concerns.
- High-Tech Exports: High-tech exports as a percentage of total manufactured exports have fallen from third to 13th, indicating a decline in technological competitiveness.
- Education Expenditure: Total public expenditure on education has also dropped from 62nd to 65th position, and the quality of education measured by pupil-teacher ratios has declined at both primary and secondary levels.
Summary Highlight:
Singapore has reaffirmed its position as the most competitive country in the world according to IMD World Competitiveness 2024. With high government and business efficiency, as well as strong infrastructure, Singapore demonstrates its resilience in facing global challenges. Nevertheless, continuous efforts are needed to address existing weaknesses and ensure sustainable and inclusive growth for all its people.
Reference:
IMD World Competitiveness 2024
AUTHOR(S)
Ganjar Primambudi is a Research Executive at iBantu's Indonesia office, with a focus on the intersection of Economics and Sustainable Finance. He holds a Master's degree in Economics and focuses on sustainable economic development.
