The International Institute for Management Development (IMD) released its annual world competitive ranking last June 26, which ranked Singapore 4th out of 64 economies. Singapore fell one spot from last year’s ranking, after coming in at first in 2019 and 2020. However, Singapore is still the most competitive economy in Asia, followed by Taiwan and Hong Kong at 6th and 7th, respectively. The dip is deemed to be insignificant because Singapore remains a very strong and competitive economy. The rankings are based on 336 criteria, which assess economic performance, government efficiency, ease of doing business, and infrastructure and the report uses a combination of surveys, statistical data, and trends to benchmark the competitiveness of 64 countries worldwide.
Singapore’s decline is primarily a result of government efficiency related factors, such as competition legislation and adaptability of government policy. Other key challenges that hindered business activity in Singapore included rising living costs due to inflation and the lack of workers’ opportunities to upgrade their capabilities. Singapore still performed well in other indicators, ranking second in employment, second in international trade, third in technological infrastructure, fourth in investment, and sixth in productivity. To maintain its competitiveness, analysts believe that Singapore should continue to invest in health, education, and digital infrastructure as well as increase its domestic production towards self-sufficiency and enhance regional cooperation especially with other Southeast Asian countries.
The report noted that the most successful economies in the most recent rankings tend to be smaller, have a good institutional framework, strong education systems, and good access to market and trading partners. Economies with agile governance that maximize access to markets and training partners have been the most competitive.
