1. The GlobalCompetitiveness Report20122013Insight ReportKlaus Schwab, World Economic Forum

2. Insight ReportThe GlobalCompetitiveness Report20122013Full Data EditionProfessor Klaus SchwabWorld Economic ForumEditorProfessor Xavier Sala-i-MartnColumbia UniversityChief Advisor of The Global Benchmarking Network 3. The Global Competitiveness Report 201220013:Full Data Edition is published by the World EconomicForum within the framework of The GlobalBenchmarking Network.Professor Klaus SchwabExecutive ChairmanProfessor Xavier Sala-i-MartnChief Advisor of The Global Benchmarking NetworkBrge BrendeManaging Director, Government Relations andConstituents EngagementTHE GLOBAL BENCHMARKING NETWORKJennifer Blanke, Senior Director,Lead Economist, Head of The GlobalBenchmarking NetworkBeat Bilbao-Osorio, Associate Director,Senior EconomistCiara Browne, Associate DirectorRoberto Crotti, Quantitative EconomistMargareta Drzeniek Hanouz, Director, SeniorEconomist, Head of Competitiveness ResearchBrindusa Fidanza, Associate Director,Environmental InitiativesThierry Geiger, Associate Director, EconomistTania Gutknecht, Community ManagerCaroline Ko, Junior EconomistCecilia Serin, Team CoordinatorWe thank Hope Steele for her excellent editing work andNeil Weinberg for his superb graphic design and layout.We are grateful to Annabel Guinault for her invaluableresearch assistance.The terms country and nation as used in this report donot in all cases refer to a territorial entity that is a stateas understood by international law and practice. Theterms cover well-defined, geographically self-containedeconomic areas that may not be states but for whichstatistical data are maintained on a separate andindependent basis.World Economic ForumGenevaCopyright 2012by the World Economic ForumAll rights reserved. No part of this publication may bereproduced, stored in a retrieval system, or transmitted,in any form or by any means, electronic, mechanical,photocopying, or otherwise without the prior permissionof the World Economic Forum.ISBN-13: 978-92-95044-35-7ISBN-10: 92-95044-35-5This book is printed on paper suitable for recycling andmade from fully managed and sustained forest sources.Printed and bound in Switzerland by SRO-Kundig.The Report and an interactive data platform are availableat www.weforum.org/gcr. 4. The Global Competitiveness Report 20122013 | iiiPartner Institutes vPreface xiiiby Klaus SchwabPart 1: Measuring Competitiveness 11.1 The Global Competitiveness Index 320122013: Strengthening Recovery by Raising Productivityby Xavier Sala-i-Martn, Beat Bilbao-Osorio, JenniferBlanke, Roberto Crotti, Margareta Drzeniek Hanouz,Thierry Geiger, and Caroline Ko1.2 Assessing the Sustainable Competitiveness 49of Nationsby Beat Bilbao-Osorio, Jennifer Blanke, Roberto Crotti,Margareta Drzeniek Hanouz, Brindusa Fidanza, ThierryGeiger, Caroline Ko, and Cecilia Serin1.3 The Executive Opinion Survey: The Voice 69of the Business Communityby Ciara Browne, Thierry Geiger, and Tania GutknechtPart 2: Data Presentation 792.1 Country/Economy Profiles 81How to Read the Country/Economy Profiles ..................................83Index of Countries/Economies ........................................................85Country/Economy Profiles ..............................................................862.2 Data Tables 375How to Read the Data Tables .......................................................377Index of Data Tables .....................................................................379Data Tables ..................................................................................381Technical Notes and Sources 519About the Authors 523Acknowledgments 527Contents 5. The Global Competitiveness Report 20122013 | vThe World Economic Forums Global Benchmarking Network is pleased to acknowledge and thankthe following organizations as its valued PartnerInstitutes, without which the realization of The GlobalCompetitiveness Report 20122013 would not havebeen feasible:AlbaniaInstitute for Contemporary Studies (ISB)Artan Hoxha, PresidentElira Jorgoni, Senior ExpertEndrit Kapaj, ExpertAlgeriaCentre de Recherche en Economie Applique pour le Dveloppement (CREAD)Youcef Benabdallah, Assistant ProfessorYassine Ferfera, DirectorArgentinaIAEUniversidad AustralEduardo Luis Fracchia, ProfessorSantiago Novoa, Project ManagerArmeniaEconomy and Values Research CenterManuk Hergnyan, ChairmanSevak Hovhannisyan, Board Member and Senior AssociateGohar Malumyan, Research AssociateAustraliaAustralian Industry GroupColleen Dowling, Senior Research CoordinatorInnes Willox, Chief ExecutiveAustriaAustrian Institute of Economic Research (WIFO)Karl Aiginger, DirectorGerhard Schwarz, Coordinator, Survey DepartmentAzerbaijanAzerbaijan Marketing SocietyFuad Aliyev, Deputy ChairmanAshraf Hajiyev, ConsultantBahrainBahrain Economic Development BoardKamal Bin Ahmed, Minister of Transportation and Acting ChiefExecutive of the Economic Development BoardNada Azmi, Manager, Economic Planning and DevelopmentMaryam Matter, Coordinator, Economic Planning and DevelopmentBangladeshCentre for Policy Dialogue (CPD)Khondaker Golam Moazzem, Senior Research FellowKishore Kumer Basak, Research AssociateMustafizur Rahman, Executive DirectorBarbadosSir Arthur Lewis Institute of Social and Economic Studies,University of West Indies (UWI)Judy Whitehead, DirectorBelgiumVlerick Business SchoolPriscilla Boiardi, Associate, Competence Centre Entrepreneurship, Governance and StrategyWim Moesen, ProfessorLeo Sleuwaegen, Professor, Competence Centre Entrepreneurship, Governance and StrategyBeninCAPODConception et Analyse de Politiques deDveloppementEpiphane Adjovi, DirectorMaria-Odile Attanasso, Deputy CoordinatorFructueux Deguenonvo, ResearcherBosnia and HerzegovinaMIT Center, School of Economics and Business in Sarajevo,University of SarajevoZlatko Lagumdzija, ProfessorZeljko Sain, Executive DirectorJasmina Selimovic, Assistant DirectorBotswanaBotswana National Productivity CentreLetsogile Batsetswe, Research Consultant and StatisticianBaeti Molake, Executive DirectorPhumzile Thobokwe, Manager, Information and Research Services DepartmentBrazilFundao Dom Cabral, Bradesco Innovation CenterCarlos Arruda, International Relations Director, Innovation and Competitiveness ProfessorDaniel Berger, Bachelor Student in EconomicsFabiana Madsen, Economist and Associate ResearcherMovimento Brasil Competitivo (MBC)Carolina Aichinger, Project CoordinatorErik Camarano, Chief Executive OfficerBrunei DarussalamMinistry of Industry and Primary ResourcesPehin Dato Yahya Bakar, MinisterNormah Suria Hayati Jamil Al-Sufri, Permanent SecretaryBulgariaCenter for Economic DevelopmentAdriana Daganova, Expert, International Programmes and ProjectsAnelia Damianova, Senior ExpertBurkina Fasolnstitut Suprieure des Sciences de la Population (ISSP), University of OuagadougouBaya Banza, DirectorPartner Institutes 6. vi | The Global Competitiveness Report 20122013Partner InstitutesBurundiUniversity Research Centre for Economic and Social Development (CURDES), National University of BurundiBanderembako Deo, DirectorGilbert Niyongabo, Dean, Faculty of Economics & ManagementCambodiaEconomic Institute of CambodiaSok Hach, PresidentSokheng Sam, ResearcherCameroonComit de Comptitivit (Competitiveness Committee)Lucien Sanzouango, Permanent SecretaryCanadaThe Conference Board of CanadaMichael R. Bloom, Vice-President, Organizational Effectiveness & LearningDouglas Watt, Associate DirectorCape VerdeINOVE RESEARCHInvestigao e Desenvolvimento, LdaJlio Delgado, Partner and Senior ResearcherJos Mendes, Chief Executive OfficerSara Frana Silva, Project ManagerChadGroupe de Recherches Alternatives et de Monitoring du Projet Ptrole-Tchad-Cameroun (GRAMP-TC)Antoine Doudjidingao, ResearcherGilbert Maoundonodji, DirectorCeline Nnodji Mbaipeur, Programme OfficerChileUniversidad Adolfo IbezFernando Larrain Aninat, Director MBALeonidas Montes, Dean, School of GovernmentChinaInstitute of Economic System and Management, NationalDevelopment and Reform CommissionChen Wei, Research FellowDong Ying, ProfessorZhou Haichun, Deputy Director and ProfessorChina Center for Economic Statistics Research, TianjinUniversity of Finance and EconomicsBojuan Zhao, ProfessorFan Yang, Professor Jian Wang, Associate ProfessorHongye Xiao, ProfessorLu Dong, ProfessorColombiaNational Planning DepartmentSara Patricia Rivera, AdvisorJohn Rodrguez, Coordinator, Competitiveness ObservatoryJavier Villarreal, Enterprise Development DirectorColombian Private Council on CompetitivenessRosario Crdoba, PresidentMarco Llins, VicepresidentCte dIvoireChambre de Commerce et dIndustrie de Cte dIvoireJean-Louis Billon, PresidentMamadou Sarr, Director GeneralCroatiaNational Competitiveness CouncilJadranka Gable, AdvisorKresimir Jurlin, Research FellowCyprusThe European UniversityBambos Papageorgiou, Head of Socioeconomic and Academic ResearchcdbbankThe Cyprus Development BankMaria Markidou-Georgiadou, Manager, Business Development and Special ProjectsCzech RepublicCMC Graduate School of BusinessTomas Janca, Executive DirectorDenmarkDanish Technological Institute, Center for Policy and BusinessDevelopmentHanne Shapiro, Center ManagerEcuadorESPAE Graduate School of Management, Escuela SuperiorPolitcnica del Litoral (ESPOL)Elizabeth Arteaga, Project AssistantVirginia Lasio, DirectorSara Wong, ProfessorEgyptThe Egyptian Center for Economic Studies (ECES)Iman Al-Ayouty, Senior EconomistOmneia Helmy, Acting Executive Director and Directorof ResearchEstoniaEstonian Institute of Economic ResearchEvelin Ahermaa, Head of Economic Research SectorMarje Josing, DirectorEstonian Development FundKitty Kubo, Head of ForesightOtt Prna, Chief Executive OfficerEthiopiaAfrican Institute of Management, Development and GovernanceZebenay Kifle, General ManagerTegenge Teka, Senior ExpertFinlandETLAThe Research Institute of the Finnish EconomyMarkku Kotilainen, Research DirectorPetri Rouvinen, Research DirectorPekka Yl-Anttila, Managing DirectorFranceHEC School of Management, ParisBertrand Moingeon, Professor and Deputy DeanBernard Ramanantsoa, Professor and DeanGabonConfdration Patronale GabonaiseRegis Loussou Kiki, General SecretaryGina Eyama Ondo, Assistant General SecretaryHenri Claude Oyima, PresidentGambia, TheGambia Economic and Social Development Research Institute (GESDRI)Makaireh A. Njie, DirectorGeorgiaBusiness Initiative for Reforms in GeorgiaTamara Janashia, Executive DirectorGiga Makharadze, Founding Member of the Board of DirectorsMamuka Tsereteli, Founding Member of the Board of Directors 7. The Global Competitiveness Report 20122013 | viiPartner InstitutesGermanyWHUOtto Beisheim School of ManagementRalf Fendel, Professor of Monetary EconomicsMichael Frenkel, Professor, Chair of Macroeconomics and International EconomicsGhanaAssociation of Ghana Industries (AGI)Patricia Addy, Projects OfficerNana Owusu-Afari, PresidentSeth Twum-Akwaboah, Executive DirectorGreeceSEV Hellenic Federation of EnterprisesMichael Mitsopoulos, Senior Advisor, EntrepreneurshipThanasis Printsipas, Economist, EntrepreneurshipGuatemalaFUNDESAFelipe Bosch G., President of the Board of DirectorsPablo Schneider, Economic DirectorJuan Carlos Zapata, General ManagerGuineaConfdration Patronale des Entreprises de GuineMohamed Bnogo Conde, Secretary-GeneralGuyanaInstitute of Development Studies, University of GuyanaKaren Pratt, Research AssociateClive Thomas, DirectorHaitiGroup Croissance SAPierre Lenz Dominique, Coordinator, Survey DepartmentKesner Pharel, Chief Executive Officer and ChairmanHong Kong SARHong Kong General Chamber of CommerceDavid ORear, Chief EconomistFederation of Hong Kong IndustriesAlexandra Poon, DirectorThe Chinese General Chamber of CommerceHungaryKOPINT-TRKI Economic Research Ltd.va Palcz, Chief Executive OfficerPeter Vakhal, Project ManagerIcelandInnovation Center IcelandArdis Armannsdottir, Marketing ManagerKarl Fridriksson, Managing Director of Human Resources and MarketingThorsteinn I. Sigfusson, DirectorIndiaConfederation of Indian Industry (CII)Chandrajit Banerjee, Director GeneralMarut Sengupta, Deputy Director GeneralGantakolla Srivastava, Head, Financial ServicesIndonesiaCenter for Industry, SME & Business Competition Studies, University of TrisaktiTulus Tambunan, Professor and DirectorIran, Islamic Republic ofThe Center for Economic Studies and Surveys (CESS), IranChamber of Commerce, Industries, Mines and AgricultureMohammad Janati Fard, Research AssociateHamed Nikraftar, Project ManagerFarnaz Safdari, Research AssociateIrelandInstitute for Business Development and Competitiveness School of Economics, University College CorkJustin Doran, Principal AssociateEleanor Doyle, DirectorCatherine Kavanagh, Principal AssociateForfs, Economic Analysis and Competitiveness DepartmentAdrian Devitt, ManagerConor Hand, EconomistIsraelManufacturers Association of Israel (MAI)Dan Catarivas, DirectorAmir Hayek, Managing DirectorZvi Oren, PresidentItalySDA Bocconi School of ManagementSecchi Carlo, Full Professor of Economic Policy, BocconiUniversityPaola Dubini, Associate Professor, Bocconi UniversityFrancesco A. Saviozzi, SDA Professor, Strategic andEntrepreneurial Management DepartmentJamaicaMona School of Business (MSB), The University of the WestIndiesPatricia Douce, Project AdministratorEvan Duggan, Executive Director and ProfessorWilliam Lawrence, Director, Professional Services UnitJapanKeio UniversityYoko Ishikura, Professor, Graduate School of Media DesignHeizo Takenaka, Director, Global Security Research InstituteJiro Tamura, Professor of Law, Keio UniversityKeizai Doyukai (Japan Association of Corporate Executives)Kiyohiko Ito, Managing Director, Keizai DoyukaiJordanMinistry of Planning & International CooperationJordan National Competitiveness TeamKawther Al-Zoubi, Head of Competitiveness DivisionBasma Arabiyat, ResearcherMukhallad Omari, Director of Policies and Studies DepartmentKazakhstanNational Analytical CentreDiana Tamabayeva, Project ManagerVladislav Yezhov, ChairmanKenyaInstitute for Development Studies, University of NairobiMohamud Jama, Director and Associate Research ProfessorPaul Kamau, Senior Research FellowDorothy McCormick, Research ProfessorKorea, Republic ofCollege of Business School, Korea Advanced Institute ofScience and Technology KAISTByungtae Lee, Acting DeanSoung-Hie Kim, Associate Dean and ProfessorJinyung Cha, Assistant Director, Exchange ProgrammeKorea Development InstituteJoohee Cho, Senior Research AssociateYongsoo Lee, Head, Policy Survey UnitKuwaitKuwait National Competitiveness CommitteeAdel Al-Husainan, Committee MemberFahed Al-Rashed, Committee ChairmanSayer Al-Sayer, Committee Member 8. viii | The Global Competitiveness Report 20122013Partner InstitutesKyrgyz RepublicEconomic Policy Institute Bishkek ConsensusLola Abduhametova, Program CoordinatorMarat Tazabekov, ChairmanLatviaStockholm School of Economics in RigaKarlis Kreslins, EMBA Programme DirectorAnders Paalzow, RectorLebanonBader Young Entrepreneurs ProgramAntoine Abou-Samra, Managing DirectorFarah Shamas, Program CoordinatorLesothoPrivate Sector Foundation of LesothoO.S.M. Moosa, PresidentThabo Qhesi, Chief Executive OfficerNteboheleng Thaele, ResearcherLibyaLibya Development Policy CenterYusser Al-Gayed, Project DirectorAhmed Jehani, ChairmanMohamed Wefati, DirectorLithuaniaStatistics LithuaniaOna Grigiene, Deputy Head, Knowledge Economyand Special Surveys Statistics DivisionVilija Lapeniene, Director GeneralGediminas Samuolis, Head, Knowledge Economy and Special Surveys Statistics DivisionLuxembourgLuxembourg Chamber of CommerceChristel Chatelain, Research AnalystStephanie Musialski, Research AnalystCarlo Thelen, Chief Economist, Member of theManaging BoardMacedonia, FYRNational Entrepreneurship and Competitiveness Council (NECC)Mirjana Apostolova, President of the AssemblyDejan Janevski, Project CoordinatorMadagascarCentre of Economic Studies, University of AntananarivoRavelomanana Mamy Raoul, DirectorRazato Rarijaona Simon, Executive SecretaryMalawiMalawi Confederation of Chambers of Commerce and IndustryHope Chavula, Public Private Dialogue ManagerChancellor L. Kaferapanjira, Chief Executive OfficerMalaysiaInstitute of Strategic and International Studies (ISIS)Jorah Ramlan, Senior Analyst, EconomicsSteven C.M. Wong, Senior Director, EconomicsMahani Zainal Abidin, Chief ExecutiveMalaysia Productivity Corporation (MPC)Mohd Razali Hussain, Director GeneralLee Saw Hoon, Senior DirectorMaliGroupe de Recherche en Economie Applique et Thorique (GREAT)Massa Coulibaly, Executive DirectorMaltaCompetitive MaltaFoundation for National CompetitivenessMargrith Lutschg-Emmenegger, Vice PresidentAdrian Said, Chief CoordinatorCaroline Sciortino, Research CoordinatorMauritaniaCentre dInformation Mauritanien pour le Dveloppement Economique et Technique (CIMDET/CCIAM)L Abdoul, Consultant and AnalystMehla Mint Ahmed, DirectorHabib Sy, Administrative Agent and AnalystMauritiusBoard of Investment of MauritiusNirmala Jeetah, Director, Planning and PolicyKen Poonoosamy, Managing DirectorJoint Economic CouncilRaj Makoond, DirectorMexicoCenter for Intellectual Capital and CompetitivenessErika Ruiz Manzur, Executive DirectorRen Villarreal Arrambide, President and Chief ExecutiveOfficerRodrigo David Villarreal Ramos, DirectorInstituto Mexicano para la Competitividad (IMCO)Priscila Garcia, ResearcherManuel Molano, Deputy General DirectorJuan E. Pardinas, General DirectorMinistry of the EconomyJose Antonio Torre, Undersecretary for Competitiveness and StandardizationEnrique Perret Erhard, Technical Secretary forCompetitivenessNarciso Suarez, Research Director, Technical Secretaryfor CompetitivenessMoldovaAcademy of Economic Studies of Moldova (AESM)Grigore Belostecinic, RectorCentre for Economic Research (CER)Corneliu Gutu, DirectorMongoliaOpen Society Forum (OSF)Munkhsoyol Baatarjav, Manager of Economic PolicyErdenejargal Perenlei, Executive DirectorMontenegroInstitute for Strategic Studies and Prognoses (ISSP)Maja Drakic, Project ManagerPetar Ivanovic, Chief Executive OfficerVeselin Vukotic, PresidentMoroccoComit National de lEnvironnement des AffairesSeloua Benmbarek, Head of MissionMozambiqueEconPolicy Research Group, Lda.Peter Coughlin, DirectorDonaldo Miguel Soares, ResearcherEma Marta Soares, AssistantNamibiaInstitute for Public Policy Research (IPPR)Graham Hopwood, Executive Director 9. The Global Competitiveness Report 20122013 | ixPartner InstitutesNepalCentre for Economic Development and Administration (CEDA)Ramesh Chandra Chitrakar, Professor, Country Coordinator and Project DirectorMahendra Raj Joshi, MemberHari Dhoj Pant, Officiating Executive Director, Advisor, SurveyprojectNetherlandsINSCOPE: Research for Innovation, Erasmus University RotterdamFrans A. J. Van den Bosch, ProfessorHenk W. Volberda, Director and ProfessorNew ZealandThe New Zealand InitiativeCatherine Harland, Research FellowOliver Hartwich, Executive DirectorNigeriaNigerian Economic Summit Group (NESG)Frank Nweke Jr., Director GeneralChris Okpoko, Associate Director, ResearchFoluso Phillips, ChairmanNorwayBI Norwegian Business SchoolEskil Goldeng, ResearcherTorger Reve, ProfessorOmanThe International Research FoundationSalem Ben Nasser Al-Ismaily, ChairmanPublic Authority for Investment Promotion and Export Development (PAIPED)Mehdi Ali Juma, Expert for Economic ResearchPakistanMishal PakistanPuruesh Chaudhary, Director ContentAmir Jahangir, Chief Executive OfficerParaguayCentro de Anlisis y Difusin de Economia Paraguaya (CADEP)Dionisio Borda, Research MemberFernando Masi, DirectorMara Beln Servn, Research MemberPeruCentro de Desarrollo Industrial (CDI), Sociedad Nacional de IndustriasNstor Asto, Project DirectorLuis Tenorio, Executive DirectorPhilippinesMakati Business Club (MBC)Michael B. Mundo, Chief EconomistMarc P. Opulencia, Deputy DirectorPeter Angelo V. Perfecto, Executive DirectorManagement Association of the Philippines (MAP)Arnold P. Salvador, Executive DirectorPolandEconomic Institute, National Bank of PolandPiotr Boguszewski, AdvisorJarosaw T. Jakubik, Deputy DirectorPortugalPROFORUM, Associao para o Desenvolvimento daEngenhariaIldio Antnio de Ayala Serdio, Vice President of the Boardof DirectorsFrum de Administradores de Empresas (FAE)Paulo Bandeira, General DirectorPedro do Carmo Costa, Member of the Board of DirectorsEsmeralda Dourado, President of the Board of DirectorsPuerto RicoPuerto Rico 2000, Inc.Ivan Puig, PresidentInstituto de Competitividad Internacional, Universidad Interamericana de Puerto RicoFrancisco Montalvo, Project CoordinatorQatarQatari Businessmen Association (QBA)Sarah Abdallah, Deputy General ManagerIssa Abdul Salam Abu Issa, Secretary-GeneralSocial and Economic Survey Research Institute (SESRI)Hanan Abdul Ibrahim, Associate DirectorDarwish Al Emadi, DirectorRomaniaSC VBD Alliance Consulting SrlIrina Ion, Program CoordinatorRolan Orzan, General DirectorRussian FederationBauman Innovation & Eurasia Competitiveness InstituteKaterina Marandi, Programme ManagerAlexey Prazdnichnykh, Principal and Managing DirectorStockholm School of Economics, RussiaIgor Dukeov, Area PrincipalCarl F. Fey, Associate Dean of ResearchRwandaPrivate Sector Federation (PSF)Hannington Namara, Chief Executive OfficerAndrew O. Rwigyema, Head of Research and PolicySaudi ArabiaNational Competitiveness Center (NCC)Awwad Al-Awwad, PresidentKhaldon Mahasen, Vice PresidentSenegalCentre de Recherches Economiques Appliques (CREA), University of DakarDiop Ibrahima Thione, DirectorSerbiaFoundation for the Advancement of Economics (FREN)Mihail Arandarenko, DirectorAleksandar Radivojevic, Project CoordinatorBojan Ristic, ResearcherSeychellesPlutus Auditing & Accounting ServicesNicolas Boulle, PartnerMarco L. Francis, PartnerSingaporeEconomic Development BoardAnna Chan, Assistant Managing Director, Planning & PolicyCheng Wai San, Head, Research & Statistics UnitTeo Xinyu, Executive, Research & Statistics UnitSlovak RepublicBusiness Alliance of Slovakia (PAS)Robert Kicina, Executive Director 10. x | The Global Competitiveness Report 20122013Partner InstitutesSloveniaInstitute for Economic ResearchPeter Stanovnik, ProfessorSonja Uric, Senior Research AssistantUniversity of Ljubljana, Faculty of EconomicsMateja Drnovek, ProfessorAle Vahcic, ProfessorSouth AfricaBusiness Leadership South AfricaFriede Dowie, DirectorThero Setiloane, Chief Executive OfficerBusiness Unity South AfricaNomaxabiso Majokweni, Chief Executive OfficerJoan Stott, Executive Director, Economic PolicySpainIESE Business School, International Center for CompetitivenessMara Luisa Blzquez, Research AssociateAntoni Subir, ProfessorSri LankaInstitute of Policy Studies of Sri Lanka (IPS)Ayodya Galappattige, Research OfficerDilani Hirimuthugodage, Research OfficerSaman Kelegama, Executive DirectorSurinameSuriname Trade & Industry Association (VSB)Helen Doelwijt, Executive SecretaryRene van Essen, DirectorDayenne Wielingen Verwey, Economic Policy OfficerSwazilandFederation of Swaziland Employers and Chamber ofCommerceMduduzi Lokotfwako, Research AnalystZodwa Mabuza, Chief Executive OfficerNyakwesi Motsa, Administration & Finance ManagerSwedenInternational University of Entrepreneurship and TechnologyNiclas Adler, PresidentSwitzerlandUniversity of St. Gallen, Executive School of Management,Technology and Law (ES-HSG)Rubn Rodriguez Startz, Head of ProjectTobias Trtsch, Communications ManagerTaiwan, ChinaCouncil for Economic Planning and Development, Executive YuanHung, J. B., Director, Economic Research DepartmentShieh, Chung Chung, Researcher, Economic Research DepartmentWu, Ming-Ji, Deputy MinisterTajikistanThe Center for Sociological Research ZerkaloRahima Ashrapova, Assistant ResearcherQahramon Baqoev, DirectorGulnora Beknazarova, ResearcherTanzaniaResearch on Poverty Alleviation (REPOA)Cornel Jahari, Assistant ResearcherJohansein Rutaihwa, Commissioned ResearcherSamuel Wangwe, Professor and Executive DirectorThailandSasin Graduate Institute of Business Administration, Chulalongkorn UniversityPongsak Hoontrakul, Senior Research FellowNarudee Kiengsiri, President of Sasin Alumni AssociationToemsakdi Krishnamra, Director of SasinThailand Development Research Institute (TDRI)Somchai Jitsuchon, Research DirectorChalongphob Sussangkarn, Distinguished FellowYos Vajragupta, Senior ResearcherTimor-LesteEast Timor Development Agency (ETDA)Jose Barreto, Survey ManagerPalmira Pires, DirectorChambers of Commerce and Industry of Timor-LesteKathleen Fon Ha Tchong Goncalves, Vice-PresidentTrinidad and TobagoArthur Lok Jack Graduate School of BusinessMiguel Carillo, Executive Director and Professor of StrategyNirmala Harrylal, Director, Internationalisation and Institutional Relations CentreThe Competitiveness CompanyRolph Balgobin, ChairmanTunisiaInstitut Arabe des Chefs dEntreprisesAhmed Bouzguenda, PresidentMajdi Hassen, Executive CounsellorTurkeyTUSIAD Sabanci University Competitiveness ForumIzak Atiyas, DirectorSelcuk Karaata, Vice DirectorSezen Ugurlu, Project SpecialistUgandaKabano Research and Development CentreRobert Apunyo, Program ManagerDelius Asiimwe, Executive DirectorFrancis Mukuya, Research AssociateUkraineCASE Ukraine, Center for Social and Economic ResearchDmytro Boyarchuk, Executive DirectorVladimir Dubrovskiy, Leading EconomistUnited Arab EmiratesAbu Dhabi Department of Economic DevelopmentH.E. Mohammed Omar Abdulla, UndersecretaryDubai Economic CouncilH.E. Hani Al Hamly, Secretary GeneralInstitute for Social and Economic Research (ISER), ZayedUniversityMouawiya Alawad, DirectorEmirates Competitiveness CouncilH.E. Abdulla Nasser Lootah, Secretary GeneralUnited KingdomLSE Enterprise Ltd, London School of Economics andPolitical ScienceAdam Austerfield, Director of ProjectsNiccolo Durazzi, Project ManagerRobyn Klingler Vidra, ResearcherUruguayUniversidad ORT UruguayIsidoro Hodara, Professor 11. The Global Competitiveness Report 20122013 | xiPartner InstitutesVenezuelaCONAPRIThe Venezuelan Council for Investment PromotionLitsay Guerrero, Economic Affairs and Investor ServicesManagerEduardo Porcarelli, Executive DirectorVietnamHo Chi Minh City Institute for Development Studies (HIDS)Nguyen Trong Hoa, Professor and PresidentDu Phuoc Tan, Head of DepartmentTrieu Thanh Son, ResearcherYemenYemeni Businessmen Club (YBC)Mohammed Esmail Hamanah, Executive ManagerFathi Abdulwasa Hayel Saeed, ChairmanMoneera Abdo Othman, Project CoordinatorMARcon Marketing ConsultingMargret Arning, Managing DirectorZambiaInstitute of Economic and Social Research (INESOR), University of ZambiaPatricia Funjika, Research FellowJolly Kamwanga, Senior Research Fellow and Project CoordinatorMubiana Macwangi, Director and ProfessorZimbabweGraduate School of Management, University of ZimbabweA. M. Hawkins, ProfessorBolivia, Costa Rica, Dominican Republic, Ecuador,El Salvador, Honduras, Nicaragua, PanamaINCAE Business School, Latin American Center forCompetitiveness and Sustainable Development (CLACDS)Ronald Arce, ResearcherArturo Condo, RectorMarlene de Estrella, Director of External RelationsLawrence Pratt, DirectorLiberia and Sierra LeoneFJP Development and Management ConsultantsOmodele R. N. Jones, Chief Executive Officer 12. The Global Competitiveness Report 20122013 | xiiiThe Global Competitiveness Report 20122013 is beingreleased amid a long period of economic uncertainty.The tentative recovery that seemed to be gaining groundduring 2010 and the first half of 2011 has given wayto renewed concerns. The global economy faces anumber of significant and interrelated challenges thatcould hamper a genuine upturn after an economic crisishalf a decade long in much of the world, especiallyin the most advanced economies. The persistingfinancial difficulties in the periphery of the euro zonehave led to a long-lasting and unresolved sovereigndebt crisis that has now reached the boiling point. Thepossibility of Greece and perhaps other countries leavingthe euro is now a distinct prospect, with potentiallydevastating consequences for the region and beyond.This development is coupled with the risk of a weakrecovery in several other advanced economies outsideof Europenotably in the United States, where politicalgridlock on fiscal tightening could dampen the growthoutlook. Furthermore, given the expected slowdown ineconomic growth in China, India, and other emerging markets, reinforced by a potential decline in global tradeand volatile capital flows, it is not clear which regionscan drive growth and employment creation in the shortto medium term.Policymakers are struggling to find ways tocooperate and manage the current economic challengeswhile preparing their economies to perform well in anincreasingly difficult and unpredictable global landscape. Amid the short-term crisis management, it remainscritical for countries to establish the fundamentalsthat underpin economic growth and development for the longer term. The World Economic Forum has, formore than three decades, played a facilitating role inthis process by providing detailed assessments of theproductive potential of nations worldwide. The Reportcontributes to an understanding of the key factors thatdetermine economic growth, helps to explain why somecountries are more successful than others in raisingincome levels and opportunities for their respectivepopulations, and offers policymakers and businessleaders an important tool in the formulation of improvedeconomic policies and institutional reforms.The complexity of todays global economic environment has made it more important than everto recognize and encourage the qualitative as well asthe quantitative aspects of growth, integrating suchconcepts as social and environmental sustainabilityto provide a fuller picture of what is needed and whatworks. In this context, the Forums Global BenchmarkingNetwork has continued to push forward with its researchon how sustainability relates to competitiveness andeconomic performance. To this end, Chapter 1.2 of thisReport presents our evolving analysis of how countrycompetitiveness can be assessed once issues ofsocial and environmental sustainability are taken intoaccount. This represents an important area for the WorldEconomic Forums research going forward.This years Report features a record number of144 economies, and thus continues to be the mostcomprehensive assessment of its kind. It contains adetailed profile for each of the economies included inthe study as well as an extensive section of data tableswith global rankings covering over 100 indicators. This Report remains the flagship publication within theForums Global Benchmarking Network, which produces a number of research studies that mirror the increasedintegration and complexity of the world economy.The Global Competitiveness Report 20122013could not have been put together without the thoughtleadership of Professor Xavier Sala-i-Martn at ColumbiaUniversity, who has provided ongoing intellectual support for our competitiveness research. Further,this Report would have not been possible without thecommitment and enthusiasm of our network of over 150Partner Institutes worldwide. The Partner Institutes areinstrumental in carrying out the Executive Opinion Surveythat provides the foundation data of this Report as wellas imparting the results of the Report at the nationallevel. We would also like to convey our sincere gratitudeto all the business executives around the world who tookthe time to participate in our Executive Opinion Survey.We are also grateful to the members of our AdvisoryBoard on Competitiveness and Sustainability, whohave provided their valuable time and knowledge tohelp us develop the framework on sustainability andcompetitiveness presented in this Report: JamesCameron, Chairman, Climate Change Capital; Dan Esty,Commissioner, Connecticut Department of Energy andEnvironmental Protection; Edwin J. Feulner Jr, President,PrefaceKLAUS SCHWABExecutive Chairman, World Economic Forum 13. xiv |The Global Competitiveness Report 20122013PrefaceThe Heritage Foundation; Clment Gignac, Minister of Natural Resources and Wildlife of Quebec; JeniKlugman, Director for Gender, The World Bank; Marc A.Levy, Deputy Director, CIESIN, Columbia University; John McArthur, Senior Fellow, United Nations Foundation;Kevin X. Murphy, President and Chief Executive Officer,J.E. Austin Associates Inc.; Mari Elka Pangestu, Ministerof Tourism and Creative Economy of Indonesia; MarkSpelman, Global Head of Strategy, Accenture; andSimon Zadek, Senior Visiting Fellow, Global GreenGrowth Institute.Appreciation also goes to Brge Brende, ManagingDirector at the Forum, and Jennifer Blanke, Head ofThe Global Benchmarking Network, as well as teammembers Beat Bilbao-Osorio, Ciara Browne, RobertoCrotti, Margareta Drzeniek Hanouz, Thierry Geiger, TaniaGutknecht, Caroline Ko, and Cecilia Serin. Finally, wewould like to thank the Africa Commission and FedEx,our partners in this Report, for their support in thisimportant publication. 14. Part 1Measuring Competitiveness 15. The Global Competitiveness Report 20122013 | 3CHAPTER 1.1The GlobalCompetitiveness Index20122013: Strengthening Recovery by RaisingProductivityXAVIER SALA-I-MARTNBEAT BILBAO-OSORIOJENNIFER BLANKEROBERTO CROTTIMARGARETA DRZENIEK HANOUZTHIERRY GEIGERCAROLINE KOWorld Economic ForumAt the time of releasing The Global Competitiveness Report 20122013, the outlook for the world economy is once again fragile. Global growth remains historically low for the second year running with major centers of economic activityparticularly large emerging economies and key advanced economiesexpected to slow in 201213, confirming the belief that the global economy is troubled by a slow and weak recovery. As in previous years, growth remains unequally distributed. Emerging and developing countries are growing faster than advanced economies, steadily closing the income gap.The International Monetary Fund (IMF) estimatesthat, in 2012, the euro zone will have contracted by0.3 percent, while the United States is experiencing aweak recovery with an uncertain future. Large emergingeconomies such as Brazil, the Russian Federation, India,China, and South Africa are growing somewhat lessthan they did in 2011. At the same time, other emergingmarketssuch as developing Asiawill continue toshow robust growth rates, while the Middle East andNorth Africa as well as sub-Saharan African countriesare gaining momentum.Recent developmentssuch as the danger of aproperty bubble in China, a decline in world trade, andvolatile capital flows in emerging marketscould derailthe recovery and have a lasting impact on the globaleconomy. Arguably, this years deceleration to a largeextent reflects the inability of leaders to address themany challenges that were already present last year.Policymakers around the world remain concerned about high unemployment and the social conditions in their countries. The political brinkmanship in the UnitedStates continues to affect the outlook for the worldslargest economy, while the sovereign debt crises andthe danger of a banking system meltdown in peripheraleuro zone countries remain unresolved. The high levels of public debt coupled with low growth, insufficientcompetitiveness, and political gridlock in some Europeancountries stirred financial markets concerns aboutsovereign default and the very viability of the euro.Given the complexity and the urgency of the situation,European countries are facing particularly difficulteconomic management decisions with challenging political and social ramifications. Although European leaders do not agree on how to address the immediatechallenges, there is recognition that, in the longer term,stabilizing the euro and putting Europe on a higherand more sustainable growth path will necessitateimprovements to the competitiveness of the weakermember states.All these developments are highly interrelated and demand timely, decisive, and coordinated actionby policymakers. In light of these uncertain globalramifications, sustained structural reforms aimed at enhancing competitiveness will be necessary for 16. 1.1: The Global Competitiveness Index 201220134 | The Global Competitiveness Report 20122013countries to stabilize economic growth and ensure therising prosperity of their populations going into the future.Competitive economies drive productivityenhancements that support high incomes by ensuring that the mechanisms enabling solid economic performance are in place.For more than three decades, the World Economic Forums annual Global Competitiveness Reportshave studied and benchmarked the many factorsunderpinning national competitiveness. From the onset,the goal has been to provide insight and stimulate thediscussion among all stakeholders on the best strategiesand policies to help countries to overcome the obstaclesto improving competitiveness. In the current challengingeconomic environment, our work is a critical reminder ofthe importance of structural economic fundamentals for sustained growth.Since 2005, the World Economic Forum hasbased its competitiveness analysis on the GlobalCompetitiveness Index (GCI), a comprehensive tool thatmeasures the microeconomic and macroeconomic foundations of national competitiveness.1We define competitiveness as the set of institutions,policies, and factors that determine the level ofproductivity of a country. The level of productivity, inturn, sets the level of prosperity that can be earned byan economy. The productivity level also determines therates of return obtained by investments in an economy,which in turn are the fundamental drivers of its growthrates. In other words, a more competitive economy isone that is likely to sustain growth.The concept of competitiveness thus involves staticand dynamic components. Although the productivity of a country determines its ability to sustain a high level ofincome, it is also one of the central determinants of itsreturns to investment, which is one of the key factorsexplaining an economys growth potential.THE 12 PILLARS OF COMPETITIVENESSMany determinants drive productivity andcompetitiveness. Understanding the factors behindthis process has occupied the minds of economistsfor hundreds of years, engendering theories ranging from Adam Smiths focus on specialization and thedivision of labor to neoclassical economists emphasis on investment in physical capital and infrastructure,2and, more recently, to interest in other mechanismssuch as education and training, technological progress,macroeconomic stability, good governance, firm sophistication, and market efficiency, among others.While all of these factors are likely to be important forcompetitiveness and growth, they are not mutuallyexclusivetwo or more of them can be significant at thesame time, and in fact that is what has been shown inthe economic literature.3This open-endedness is captured within the GCIby including a weighted average of many differentcomponents, each measuring a different aspect of competitiveness. These components are grouped into 12pillars of competitiveness (see Figure 1):First pillar: InstitutionsThe institutional environment is determined by the legaland administrative framework within which individuals, firms, and governments interact to generate wealth. Theimportance of a sound and fair institutional environmentbecame even more apparent during the recent economicand financial crisis and is especially crucial for furthersolidifying the fragile recovery given the increasing role played by the state at the international level and for theeconomies of many countries.The quality of institutions has a strong bearing oncompetitiveness and growth.4 It influences investmentdecisions and the organization of production and playsa key role in the ways in which societies distribute thebenefits and bear the costs of development strategiesand policies. For example, owners of land, corporateshares, or intellectual property are unwilling to invest inthe improvement and upkeep of their property if theirrights as owners are not protected.5The role of institutions goes beyond the legalframework. Government attitudes toward marketsand freedoms and the efficiency of its operationsare also very important: excessive bureaucracy andred tape,6 overregulation, corruption, dishonesty in dealing with public contracts, lack of transparency andtrustworthiness, inability to provide appropriate services for the business sector, and political dependence ofthe judicial system impose significant economic costs to businesses and slow the process of economicdevelopment.In addition, the proper management of publicfinances is also critical to ensuring trust in the nationalbusiness environment. Indicators capturing the quality of government management of public finances aretherefore included here to complement the measures of macroeconomic stability captured in pillar 3 below.Although the economic literature has focused mainly on public institutions, private institutions are also animportant element in the process of creating wealth.The recent global financial crisis, along with numerouscorporate scandals, have highlighted the relevance of accounting and reporting standards and transparencyfor preventing fraud and mismanagement, ensuring goodgovernance, and maintaining investor and consumer confidence. An economy is well served by businessesthat are run honestly, where managers abide by strongethical practices in their dealings with the government,other firms, and the public at large.7 Private-sectortransparency is indispensable to business, and can bebrought about through the use of standards as well as 17. The Global Competitiveness Report 20122013 | 51.1: The Global Competitiveness Index 20122013auditing and accounting practices that ensure access toinformation in a timely manner.8Second pillar: InfrastructureExtensive and efficient infrastructure is critical forensuring the effective functioning of the economy, asit is an important factor in determining the location ofeconomic activity and the kinds of activities or sectorsthat can develop in a particular instance. Well-developedinfrastructure reduces the effect of distance betweenregions, integrating the national market and connecting itat low cost to markets in other countries and regions. Inaddition, the quality and extensiveness of infrastructure networks significantly impact economic growth and reduce income inequalities and poverty in a variety ofways.9 A well-developed transport and communications infrastructure network is a prerequisite for the access ofless-developed communities to core economic activities and services.Effective modes of transportincluding qualityroads, railroads, ports, and air transportenableentrepreneurs to get their goods and services tomarket in a secure and timely manner and facilitatethe movement of workers to the most suitable jobs.Economies also depend on electricity supplies that arefree of interruptions and shortages so that businessesand factories can work unimpeded. Finally, a solidand extensive telecommunications network allows fora rapid and free flow of information, which increasesoverall economic efficiency by helping to ensure thatbusinesses can communicate and decisions are made by economic actors taking into account all availablerelevant information.Third pillar: Macroeconomic environmentThe stability of the macroeconomic environment isimportant for business and, therefore, is important forthe overall competitiveness of a country.10 Although it is certainly true that macroeconomic stability alonecannot increase the productivity of a nation, it is alsorecognized that macroeconomic instability harms the economy, as we have seen over the past years, notablyin the European context. The government cannotprovide services efficiently if it has to make high-interestpayments on its past debts. Running fiscal deficits limitsthe governments future ability to react to businesscycles and to invest in competitiveness-enhancingmeasures. Firms cannot operate efficiently when inflationrates are out of hand. In sum, the economy cannot growin a sustainable manner unless the macro environment is stable. Macroeconomic stability has captured theattention of the public most recently when someEuropean countries needed the support of the IMF andother euro zone economies to prevent sovereign default,as their public debt reached unsustainable levels.It is important to note that this pillar evaluatesthe stability of the macroeconomic environment, so itdoes not directly take into account the way in whichpublic accounts are managed by the government. Thisqualitative dimension is captured in the institutions pillardescribed above.Fourth pillar: Health and primary educationA healthy workforce is vital to a countryscompetitiveness and productivity. Workers who areill cannot function to their potential and will be lessproductive. Poor health leads to significant costs tobusiness, as sick workers are often absent or operate atlower levels of efficiency. Investment in the provision ofhealth services is thus critical for clear economic, as wellas moral, considerations.11In addition to health, this pillar takes into account thequantity and quality of the basic education received bythe population. Basic education increases the efficiency of each individual worker. Moreover, workers who havereceived little formal education can carry out only simplemanual tasks and find it much more difficult to adapt tomore advanced production processes and techniques, and therefore contribute less to come up with or executeinnovations. In other words, lack of basic educationcan become a constraint on business development,with firms finding it difficult to move up the value chainby producing more sophisticated or value-intensive products with existing human resources.For the longer term, it will be essential to avoidsignificant reductions in resource allocation to thesecritical areas, in spite of the fact that governmentbudgets will need to be cut to reduce the deficits anddebt burden.Fifth pillar: Higher education and trainingQuality higher education and training is particularlycrucial for economies that want to move up the valuechain beyond simple production processes andproducts.12 In particular, todays globalizing economy requires countries to nurture pools of well-educatedworkers who are able to perform complex tasks andadapt rapidly to their changing environment and theevolving needs of the economy. This pillar measuressecondary and tertiary enrollment rates as well asthe quality of education as evaluated by the businesscommunity. The extent of staff training is also taken intoconsideration because of the importance of vocationaland continuous on-the-job trainingwhich is neglectedin many economiesfor ensuring a constant upgradingof workers skills.Sixth pillar: Goods market efficiencyCountries with efficient goods markets are wellpositioned to produce the right mix of products andservices given their particular supply-and-demand 18. 1.1: The Global Competitiveness Index 201220136 | The Global Competitiveness Report 20122013conditions, as well as to ensure that these goods canbe most effectively traded in the economy. Healthymarket competition, both domestic and foreign, isimportant in driving market efficiency and thus businessproductivity by ensuring that the most efficient firms,producing goods demanded by the market, are thosethat thrive. The best possible environment for theexchange of goods requires a minimum of impedimentsto business activity through government intervention. Forexample, competitiveness is hindered by distortionary orburdensome taxes and by restrictive and discriminatoryrules on foreign direct investment (FDI)limiting foreignownershipas well as on international trade. Therecent economic crisis has highlighted the degree of interdependence of economies worldwide and thedegree to which growth depends on open markets.Protectionist measures are counterproductive as they reduce aggregate economic activity.Market efficiency also depends on demandconditions such as customer orientation and buyersophistication. For cultural or historical reasons, customers may be more demanding in some countriesthan in others. This can create an important competitiveadvantage, as it forces companies to be more innovativeand customer-oriented and thus imposes the discipline necessary for efficiency to be achieved in the market.Seventh pillar: Labor market efficiencyThe efficiency and flexibility of the labor market arecritical for ensuring that workers are allocated to theirmost effective use in the economy and provided withincentives to give their best effort in their jobs. Labormarkets must therefore have the flexibility to shiftworkers from one economic activity to another rapidlyand at low cost, and to allow for wage fluctuationswithout much social disruption.13 The importance ofwell-functioning labor markets has been dramaticallyhighlighted by last years events in Arab countries, whererigid labor markets were an important cause of highyouth unemployment, sparking social unrest in Tunisia that then spread across the region. Youth unemploymentis also high in a number of European countries, whereimportant barriers to entry into the labor market remainin place.Efficient labor markets must also ensure a clearrelationship between worker incentives and theirefforts to promote meritocracy at the workplace, andthey must provide equity in the business environmentbetween women and men. Taken together these factorshave a positive effect on worker performance and theattractiveness of the country for talent, two aspects thatare growing more important as talent shortages loom onthe horizon.Eighth pillar: Financial market developmentThe recent economic crisis has highlighted the centralrole of a sound and well-functioning financial sectorfor economic activities. An efficient financial sectorallocates the resources saved by a nations citizens, aswell as those entering the economy from abroad, to theirmost productive uses. It channels resources to thoseentrepreneurial or investment projects with the highestexpected rates of return rather than to the politicallyconnected. A thorough and proper assessment of risk istherefore a key ingredient of a sound financial market.Business investment is also critical to productivity.Therefore economies require sophisticated financial markets that can make capital available for private-sectorinvestment from such sources as loans from a soundbanking sector, well-regulated securities exchanges, venture capital, and other financial products. In order tofulfill all those functions, the banking sector needs to betrustworthy and transparent, andas has been madeso clear recentlyfinancial markets need appropriateregulation to protect investors and other actors in theeconomy at large.Ninth pillar: Technological readinessIn todays globalized world, technology is increasingly essential for firms to compete and prosper. Thetechnological readiness pillar measures the agility with which an economy adopts existing technologies toenhance the productivity of its industries, with specificemphasis on its capacity to fully leverage informationand communication technologies (ICT) in daily activitiesand production processes for increased efficiency and enabling innovation for competitiveness.14 ICT hasevolved into the general purpose technology of ourtime,15 given the critical spillovers to the other economicsectors and their role as industry-wide enablinginfrastructure. Therefore ICT access and usage are keyenablers of countries overall technological readiness.Whether the technology used has or has notbeen developed within national borders is irrelevantfor its ability to enhance productivity. The centralpoint is that the firms operating in the country needto have access to advanced products and blueprintsand the ability to absorb and use them. Among themain sources of foreign technology, FDI often playsa key role, especially for countries at a lower stage oftechnological development. It is important to note that, in this context, the level of technology available to firms ina country needs to be distinguished from the countrysability to conduct blue-sky research and develop newtechnologies for innovation that expand the frontiersof knowledge. That is why we separate technologicalreadiness from innovation, captured in the 12th pillar,described below. 19. The Global Competitiveness Report 20122013 | 71.1: The Global Competitiveness Index 20122013Tenth pillar: Market sizeThe size of the market affects productivity since largemarkets allow firms to exploit economies of scale.Traditionally, the markets available to firms havebeen constrained by national borders. In the era ofglobalization, international markets can to a certainextent substitute for domestic markets, especially forsmall countries. Vast empirical evidence shows thattrade openness is positively associated with growth.Even if some recent research casts doubts on therobustness of this relationship, there is a general sensethat trade has a positive effect on growth, especiallyfor countries with small domestic markets.16 The caseof the European Union illustrates the importance of themarket size for competitiveness, as important efficiencygains were realized through closer integration. Althoughthe reduction of trade barriers and the harmonization ofstandards within the European Union have contributedto raising exports within the region, many barriers to atrue single market, in particular in services, remain inplace and lead to important border effects. Thereforewe continue to use the size of the national domestic andforeign market in the Index.Thus exports can be thought of as a substitute fordomestic demand in determining the size of the marketfor the firms of a country.17 By including both domestic and foreign markets in our measure of market size, wegive credit to export-driven economies and geographic areas (such as the European Union) that are divided intomany countries but have a single common market.Eleventh pillar: Business sophisticationThere is no doubt that sophisticated business practicesare conducive to higher efficiency in the production of goods and services. Business sophistication concerns two elements that are intricately linked: the quality of acountrys overall business networks and the quality ofindividual firms operations and strategies. These factorsare particularly important for countries at an advancedstage of development when, to a large extent, themore basic sources of productivity improvements havebeen exhausted. The quality of a countrys businessnetworks and supporting industries, as measured bythe quantity and quality of local suppliers and the extentof their interaction, is important for a variety of reasons.When companies and suppliers from a particularsector are interconnected in geographically proximate groups, called clusters, efficiency is heightened, greater opportunities for innovation in processes and products are created, and barriers to entry for new firms arereduced. Individual firms advanced operations andstrategies (branding, marketing, distribution, advancedproduction processes, and the production of unique and sophisticated products) spill over into the economy andlead to sophisticated and modern business processesacross the countrys business sectors.Twelfth pillar: InnovationInnovation can emerge from new technological and non-technological knowledge. Non-technological innovations are closely related to the know-how, skills, and workingconditions that are embedded in organizations andare therefore largely covered by the eleventh pillar ofthe GCI. The final pillar of competitiveness focuses ontechnological innovation. Although substantial gainscan be obtained by improving institutions, buildinginfrastructure, reducing macroeconomic instability, or improving human capital, all these factors eventuallyseem to run into diminishing returns. The same is true forthe efficiency of the labor, financial, and goods markets.In the long run, standards of living can be largelyenhanced by technological innovation. Technological breakthroughs have been at the basis of many of theproductivity gains that our economies have historically experienced. These range from the industrial revolutionin the 18th century and the invention of the steam engineand the generation of electricity to the more recent digitalrevolution. The latter is transforming not only the waythings are being done, but also opening a wider rangeof new possibilities in terms of products and services.Innovation is particularly important for economies as theyapproach the frontiers of knowledge and the possibilityof generating more value by only integrating andadapting exogenous technologies tends to disappear.18Although less-advanced countries can still improvetheir productivity by adopting existing technologiesor making incremental improvements in other areas,for those that have reached the innovation stage ofdevelopment this is no longer sufficient for increasingproductivity. Firms in these countries must designand develop cutting-edge products and processes tomaintain a competitive edge and move toward higher-value-added activities. This progression requires anenvironment that is conducive to innovative activity andsupported by both the public and the private sectors. Inparticular, it means sufficient investment in research anddevelopment (R&D), especially by the private sector; thepresence of high-quality scientific research institutionsthat can generate the basic knowledge needed to buildthe new technologies; extensive collaboration in researchand technological developments between universities and industry; and the protection of intellectual property,in addition to high levels of competition and accessto venture capital and financing that are analyzed inother pillars of the Index. In light of the recent sluggishrecovery and rising fiscal pressures faced by advancedeconomies, it is important that public and private sectors resist pressures to cut back on the R&D spending thatwill be so critical for sustainable growth going into thefuture. 20. 1.1: The Global Competitiveness Index 201220138 | The Global Competitiveness Report 20122013The interrelation of the 12 pillarsWhile we report the results of the 12 pillars ofcompetitiveness separately, it is important to keepin mind that they are not independent: they tend toreinforce each other, and a weakness in one area oftenhas a negative impact in others. For example, a stronginnovation capacity (pillar 12) will be very difficult toachieve without a healthy, well-educated and trainedworkforce (pillars 4 and 5) that is adept at absorbing newtechnologies (pillar 9), and without sufficient financing (pillar 8) for R&D or an efficient goods market that makesit possible to take new innovations to market (pillar 6).Although the pillars are aggregated into a single index,measures are reported for the 12 pillars separatelybecause such details provide a sense of the specificareas in which a particular country needs to improve.The appendix describes the exact composition ofthe GCI and technical details of its construction.STAGES OF DEVELOPMENT AND THE WEIGHTEDINDEXWhile all of the pillars described above will matter to acertain extent for all economies, it is clear that they willaffect them in different ways: the best way for Cambodiato improve its competitiveness is not the same as thebest way for France to do so. This is because Cambodiaand France are in different stages of development: ascountries move along the development path, wages tendto increase and, in order to sustain this higher income,labor productivity must improve.In line with the economic theory of stages ofdevelopment, the GCI assumes that economies in thefirst stage are mainly factor-driven and compete basedon their factor endowmentsprimarily low-skilled laborand natural resources.19 Companies compete on the basis of price and sell basic products or commodities, with their low productivity reflected in low wages.Maintaining competitiveness at this stage of developmenthinges primarily on well-functioning public and privateinstitutions (pillar 1), a well-developed infrastructure(pillar 2), a stable macroeconomic environment (pillar 3), and a healthy workforce that has received at least abasic education (pillar 4).As a country becomes more competitive,productivity will increase and wages will rise withadvancing development. Countries will then moveinto the efficiency-driven stage of development, whenthey must begin to develop more efficient productionprocesses and increase product quality because wages have risen and they cannot increase prices. AtFigure 1: The Global Competitiveness Index frameworkKey forfactor-driveneconomiesKey forefficiency-driveneconomiesKey forinnovation-driveneconomiesPillar 1. InstitutionsPillar 2. InfrastructurePillar 3. Macroeconomic environmentPillar 4. Health and primary educationPillar 11. Business sophistication Pillar 12. Innovation Pillar 5. Higher education andtrainingPillar 6. Goods market efficiency Pillar 7. Labor market efficiency Pillar 8. Financial marketdevelopmentPillar 9. Technological readiness Pillar 10. Market sizeBasic requirementssubindexEfficiency enhancerssubindexInnovation and sophisticationfactors subindexNote: See the appendix for the detailed structure of the GCI.GLOBAL COMPETITIVENESS INDEX 21. The Global Competitiveness Report 20122013 | 91.1: The Global Competitiveness Index 20122013Table 1: Subindex weights and income thresholds for stages of development STAGES OF DEVELOPMENT Stage 1: Transition from Stage 2: Transition from Stage 3:Factor-driven stage 1 to stage 2 Efficiency-driven stage 2 to stage 3 Innovation-drivenGDP per capita (US$) thresholds* 17,000Weight for basic requirements subindex 60% 4060% 40% 2040% 20%Weight for efficiency enhancers subindex 35% 3550% 50% 50% 50%Weight for innovation and sophistication factors 5% 510% 10% 1030% 30%Note: See individual country/economy profiles for the exact applied weights.* For economies with a high dependency on mineral resources, GDP per capita is not the sole criterion for the determination of the stage of development. See text for details.this point, competitiveness is increasingly driven byhigher education and training (pillar 5), efficient goods markets (pillar 6), well-functioning labor markets (pillar 7),developed financial markets (pillar 8), the ability toharness the benefits of existing technologies (pillar 9),and a large domestic or foreign market (pillar 10).Finally, as countries move into the innovation-drivenstage, wages will have risen by so much that they areable to sustain those higher wages and the associatedstandard of living only if their businesses are able tocompete with new and/or unique products, services, models, and processes. At this stage, companiesmust compete by producing new and different goodsthrough new technologies (pillar 12) and/or the mostsophisticated production processes or business models (pillar 11).The GCI takes the stages of development intoaccount by attributing higher relative weights to thosepillars that are more relevant for an economy given itsparticular stage of development. That is, although all12 pillars matter to a certain extent for all countries, therelative importance of each one depends on a countrysparticular stage of development. To implement thisconcept, the pillars are organized into three subindexes,each critical to a particular stage of development.The basic requirements subindex groups those pillars most critical for countries in the factor-drivenstage. The efficiency enhancers subindex includes those pillars critical for countries in the efficiency-drivenstage. And the innovation and sophistication factors subindex includes the pillars critical to countries in theinnovation-driven stage. The three subindexes are shownin Figure 1.The weights attributed to each subindex in everystage of development are shown in Table 1. To obtainthe weights shown in the table, a maximum likelihoodregression of GDP per capita was run against eachsubindex for past years, allowing for different coefficientsfor each stage of development.20 The rounding of theseeconometric estimates led to the choice of weightsdisplayed in Table 1.Implementation of stages of developmentTwo criteria are used to allocate countries into stages ofdevelopment. The first is the level of GDP per capita atmarket exchange rates. This widely available measureis used as a proxy for wages, because internationallycomparable data on wages are not available for allcountries covered. The thresholds used are also shownin Table 1. A second criterion is used to adjust forcountries that are wealthy, but where prosperity is basedon the extraction of resources. This is measured by theshare of exports of mineral goods in total exports (goodsand services), and assumes that countries that exportmore than 70 percent of mineral products (measuredusing a five-year average) are to a large extent factordriven.21Any countries falling in between two of the threestages are considered to be in transition. For thesecountries, the weights change smoothly as a countrydevelops, reflecting the smooth transition from onestage of development to another. This allows usto place increasingly more weight on those areasthat are becoming more important for the countryscompetitiveness as the country develops, ensuring thatthe GCI can gradually penalize those countries thatare not preparing for the next stage. The classificationof countries into stages of development is shown inTable 2.DATA SOURCESTo measure these concepts, the GCI uses statisticaldata such as enrollment rates, government debt, budgetdeficit, and life expectancy, which are obtained frominternationally recognized agencies, notably the UnitedNations Educational, Scientific and Cultural Organization(UNESCO), the IMF, and the World Health Organization(WHO). The descriptions and data sources of all thesestatistical variables are presented in the Technical Notesand Sources at the end of this Report. Furthermore, the GCI uses data from the World Economic Forumsannual Executive Opinion Survey (Survey) to captureconcepts that require a more qualitative assessmentor for which internationally comparable statistical data 22. 1.1: The Global Competitiveness Index 2012201310 | The Global Competitiveness Report 20122013are not available for the entire set of economies. TheSurvey process and the statistical treatment of data aredescribed in detail in Chapter 1.3 of this Report.ADJUSTMENTS TO THE GCIA few minor adjustments have been made to theGCI structure this year. Within the macroeconomic environment pillar (3rd), the interest rate spread hasbeen removed from the Index because of limitationsin the international comparability of these data.Furthermore, mobile broadband was added to the technological readiness (9th) pillar in order to take intoaccount the rapidly expanding access to the Internetvia mobile devices. And a variable capturing the extentto which governments provide services to the businesscommunity, which has been collected through the Executive Opinion Survey, was added to the institutionspillar (1st). For the patent indicator in the innovation pillar (12th), the source has been changed to include databased on the Patents Co-operations Treaty instead ofthe US Patent and Trademark Office (USPTO), whichhad been used until now. These data are collectedand published jointly by the World Intellectual PropertyOrganization and the Organisation for Economic Co-operation and Development (OECD). They record patentapplications globally, not just in the United States,therefore eliminating a possible geographical bias.22Finally, the Rigidity of Employment Index was dropped from the labor market efficiency pillar (7th), as the WorldBank ceased to provide this indicator.23COUNTRY COVERAGEThe coverage of this year has increased from 142 to 144economies. The newly covered countries are Gabon,Guinea, Liberia, Seychelles, and Sierra Leone. Libyawas re-included after a year of absence as we wereTable 2: Countries/economies at each stage of developmentStage 1:Factor-driven(38 economies)Transition fromstage 1 to stage 2(17 economies)Stage 2:Efficiency-driven(33 economies)Transition fromstage 2 to stage 3(21 economies)Stage 3:Innovation-driven(35 economies)Bangladesh Algeria Albania Argentina AustraliaBenin Azerbaijan Armenia Bahrain AustriaBurkina Faso Bolivia Bosnia and Herzegovina Barbados BelgiumBurundi Botswana Bulgaria Brazil CanadaCambodia Brunei Darussalam Cape Verde Chile CyprusCameroon Egypt China Croatia Czech RepublicChad Gabon Colombia Estonia DenmarkCte dIvoire Honduras Costa Rica Hungary FinlandEthiopia Iran, Islamic rep. Dominican Republic Kazakhstan FranceGambia, The Kuwait Ecuador Latvia GermanyGhana Libya El Salvador Lebanon GreeceGuinea Mongolia Georgia Lithuania Hong Kong SARHaiti Philippines Guatemala Malaysia IcelandIndia Qatar Guyana Mexico IrelandKenya Saudi Arabia Indonesia Oman IsraelKyrgyz Republic Sri Lanka Jamaica Poland ItalyLesotho Venezuela Jordan Russian Federation JapanLiberia Macedonia, FYR Seychelles Korea, Rep.Madagascar Mauritius Trinidad and Tobago LuxembourgMalawi Montenegro Turkey MaltaMali Morocco Uruguay NetherlandsMauritania Namibia New ZealandMoldova Panama NorwayMozambique Paraguay PortugalNepal Peru Puerto RicoNicaragua Romania SingaporeNigeria Serbia Slovak RepublicPakistan South Africa SloveniaRwanda Suriname SpainSenegal Swaziland SwedenSierra Leone Thailand SwitzerlandTajikistan Timor-Leste Taiwan, ChinaTanzania Ukraine United Arab EmiratesUganda United KingdomVietnam United StatesYemenZambiaZimbabwe 23. The Global Competitiveness Report 20122013 | 111.1: The Global Competitiveness Index 20122013not able to conduct the Survey because of civil unrestin 2011. Three previously covered countries had to beexcluded from this years Report. Survey data could notbe collected in Belize and Angola; in Syria, the securitysituation did not allow the Survey to be carried out. In thecase of Tunisia we decided not to report the results thisyear because an important structural break in the datamakes comparisons with past years difficult. We hope tore-include these countries in the future.THE GLOBAL COMPETITIVENESS INDEX 20122013RANKINGSTables 3 through 7 provide the detailed rankings ofthis years GCI. The following sections discuss thefindings of the GCI 20122013 for the top performersglobally, as well as for a number of selected economiesin each of the five following regions: Europe and NorthAmerica, Asia and the Pacific, Latin America and theCaribbean, the Middle East and North Africa, and sub-Saharan Africa. Box 1 presents a comparative study ofthe GCI results, highlighting the profound and persistingcompetitiveness divide across and within the differentworld regions.Top 10As in previous years, this years top 10 remain dominatedby a number of European countries, with Switzerland,Finland, Sweden, the Netherlands, Germany, and theUnited Kingdom confirming their place among the most competitive economies. Along with the UnitedStates, three Asian economies also figure in top 10,with Singapore remaining the second-most competitiveeconomy in the world, and Hong Kong SAR and Japanplacing 9th and 10th.Switzerland retains its 1st place position again thisyear as a result of its continuing strong performanceacross the board. The countrys most notablestrengths are related to innovation and labor marketefficiency, where it tops the GCI rankings, as well as thesophistication of its business sector, which is ranked2nd. Switzerlands scientific research institutions areamong the worlds best, and the strong collaborationbetween its academic and business sectors, combinedwith high company spending on R&D, ensures thatmuch of this research is translated into marketableproducts and processes reinforced by strong intellectualproperty protection. This robust innovative capacity iscaptured by its high rate of patenting per capita, forwhich Switzerland ranks a remarkable 2nd worldwide.Productivity is further enhanced by a business sectorthat offers excellent on-the-job-training opportunities,both citizens and private companies that are proactiveat adapting the latest technologies, and labor marketsthat balance employee protection with the interests ofemployers. Moreover, public institutions in Switzerlandare among the most effective and transparent in theworld (5th). Governance structures ensure a level playingfield, enhancing business confidence; these include an independent judiciary, a strong rule of law, and ahighly accountable public sector. Competitiveness is also buttressed by excellent infrastructure (5th),well-functioning goods markets (7th), and highlydeveloped financial markets (9th). Finally, Switzerlandsmacroeconomic environment is among the most stablein the world (8th) at a time when many neighboringeconomies continue to struggle in this area.While Switzerland demonstrates many competitivestrengths, maintaining its innovative capacity will requireboosting university enrollment, which continues to lagbehind that of many other high-innovation countries,although this has been increasing in recent years.Singapore retains its place at 2nd position asa result of an outstanding performance across theentire Index. The country features in the top 3 inseven of the 12 categories of the Index and appearsin the top 10 of three others. Its public and privateinstitutions are rated as the best in the world for thefifth year in a row. It also ranks 1st for the efficiencyof its goods and labor markets, and places 2nd interms of financial market development. Singapore alsohas world-class infrastructure (2nd), with excellent roads, ports, and air transport facilities. In addition,the countrys competitiveness is reinforced by a strongfocus on education, which has translated into a steadyimprovement in the higher education and training pillar(2nd) in recent years, thus providing individuals with theskills needed for a rapidly changing global economy.Finland moves up one place since last year toreach 3rd position on the back of small improvementsin a number of areas. Similar to other countries inthe region, the country boasts well-functioning andhighly transparent public institutions (2nd), toppingseveral indicators included in this category. Its privateinstitutions, ranked 3rd overall, are also seen to beamong the best run and most ethical in the world.Finland occupies the top position both in the healthand primary education pillar as well as the highereducation and training pillar, the result of a strong focuson education over recent decades. This has providedthe workforce with the skills needed to adapt rapidly toa changing environment and has laid the groundworkfor high levels of technological adoption and innovation. Finland is one of the most innovative countries inEurope, ranking 2nd, behind only Switzerland, on therelated pillar. Improving the countrys capacity to adoptthe latest technologies (ranked 25th) could lead toimportant synergies that in turn could corroborate the countrys position as one of the worlds most innovativeeconomies. Finlands macroeconomic environment weakens slightly on the back of rising inflation (above 3percent), but fares comparatively well when contrastedwith other euro-area economies. 24. 1.1: The Global Competitiveness Index 2012201312 | The Global Competitiveness Report 20122013Box 1: Competitiveness from above: The GCI heat mapFigure 1: The GCI heat map* The interval [x,y[ is inclusive of x but exclusive of y. Highest value; lowest value.Figure 1 identifies the competitiveness hotspots and theregions or countries with weak performance according to theGlobal Competitiveness Index (GCI). The 10 best-performingcountries are shaded dark red. The remaining countriesare colored in intermediate tones moving from orange, thesecond-best performing group, through yellow, light blue, medium blue, and dark blue; this last color identifies the least-competitive nations according to the GCI.The map reveals that the hotspots remain concentratedin Europe, North America, and a handful of advancedeconomies in Asia and the Pacific. Despite decades of brisk economic growth in some developing regions (such as LatinAmerica and Africa), the map reveals that the profoundcompetitiveness gap of these regions with more advancedeconomies persists. This competitiveness deficit in vast swaths of the developing world raises questions about thesustainability of growth patterns. Sub-Saharan Africa, for example, continues to face thebiggest competitiveness challenges of all regions (see Box 5). As shown on the map, a vast majority of the continentscountries covered in this Report fall into the group of least-competitive economies (dark blue). Out of the regions 32 countries included in the GCI, only Botswana, Gabon,Namibia, the Seychelles (medium blue), Mauritius, Rwanda, and South Africa (light blue) are in the next higher categories.With six of the ten best-performing countries, Northernand Western Europe is a competitiveness hotspot. Theassessment is considerably bleaker when looking atSouthern and Eastern Europe. On the map, the patchwork ofcolorsranging from dark red to medium bluereveals thecompetitiveness divide within Europe. Indeed, the lack ofcompetitiveness of several of its members is among the rootcauses of the current difficulties in the euro zone (see Box2). The map also shows that within the European Union thetraditional distinction made between the 15 original members and the 12 countries that joined after 2004 does not holdfrom a competitiveness point of view.The map draws a mixed picture of Asia, too. Scatteredacross the region, the Asian Tigers and Japan can beconsidered competitiveness hotspots. Within this group offive advanced economies, Singapore, Hong Kong SAR, andJapan enter the top 10, and Taiwan (China), and the Republicof Korea rank only a few notches behind. The developingnations of Southeast Asia are not yet competitivenesschampions, but their group performance is quite remarkable. Led by Malaysia, all these economies achieve a GCI scoreabove 4.0, the theoretical average of the GCI, and none ofthem falls into the lowest, dark-blue category. This contrastsstarkly with the situation in South Asia, where best-performing India ranks a middling 59th and several countriesappear in dark blue, including Pakistan and Bangladesh.In the Middle East and North Africa, Israel and the sixmembers of the Gulf Cooperation Council perform strongly.But elsewhere in the region, the lack of competitiveness of theLevantine and North African countries is worrisome. Finally,the map also reveals that the BRICS do not form a uniformgroup in terms of competitiveness, as seen on the map whereChina is the only member appearing in a relatively strongyellow.GCI score*n [5.39,5.72]n [5.00,5.39[n [4.60,5.00[n [4.20,4.60[n [3.80,4.20[n [2.78,3.80[n Not covered 25. The Global Competitiveness Report 20122013 | 131.1: The Global Competitiveness Index 20122013Table 3: The Global Competitiveness Index 20122013 rankings and 20112012 comparisons Rank amongScore GCI 20112012 GCI 20112012Country/Economy Rank/144 (17) sample rankSwitzerland 1 5.72 1 1Singapore 2 5.67 2 2Finland 3 5.55 3 4Sweden 4 5.53 4 3Netherlands 5 5.50 5 7Germany 6 5.48 6 6United States 7 5.47 7 5United Kingdom 8 5.45 8 10Hong Kong SAR 9 5.41 9 11Japan 10 5.40 10 9Qatar 11 5.38 11 14Denmark 12 5.29 12 8Taiwan, China 13 5.28 13 13Canada 14 5.27 14 12Norway 15 5.27 15 16Austria 16 5.22 16 19Belgium 17 5.21 17 15Saudi Arabia 18 5.19 18 17Korea, Rep. 19 5.12 19 24Australia 20 5.12 20 20France 21 5.11 21 18Luxembourg 22 5.09 22 23New Zealand 23 5.09 23 25United Arab Emirates 24 5.07 24 27Malaysia 25 5.06 25 21Israel 26 5.02 26 22Ireland 27 4.91 27 29Brunei Darussalam 28 4.87 28 28China 29 4.83 29 26Iceland 30 4.74 30 30Puerto Rico 31 4.67 31 35Oman 32 4.65 32 32Chile 33 4.65 33 31Estonia 34 4.64 34 33Bahrain 35 4.63 35 37Spain 36 4.60 36 36Kuwait 37 4.56 37 34Thailand 38 4.52 38 39Czech Republic 39 4.51 39 38Panama 40 4.49 40 49Poland 41 4.46 41 41Italy 42 4.46 42 43Turkey 43 4.45 43 59Barbados 44 4.42 44 42Lithuania 45 4.41 45 44Azerbaijan 46 4.41 46 55Malta 47 4.41 47 51Brazil 48 4.40 48 53Portugal 49 4.40 49 45Indonesia 50 4.40 50 46Kazakhstan 51 4.38 51 72South Africa 52 4.37 52 50Mexico 53 4.36 53 58Mauritius 54 4.35 54 54Latvia 55 4.35 55 64Slovenia 56 4.34 56 57Costa Rica 57 4.34 57 61Cyprus 58 4.32 58 47India 59 4.32 59 56Hungary 60 4.30 60 48Peru 61 4.28 61 67Bulgaria 62 4.27 62 74Rwanda 63 4.24 63 70Jordan 64 4.23 64 71Philippines 65 4.23 65 75Iran, Islamic Rep. 66 4.22 66 62Russian Federation 67 4.20 67 66Sri Lanka 68 4.19 68 52Colombia 69 4.18 69 68Morocco 70 4.15 70 73Slovak Republic 71 4.14 71 69Montenegro 72 4.14 72 60Rank amongScore GCI 20112012 GCI 20112012Country/Economy Rank/144 (17) sample rankUkraine 73 4.14 73 82Uruguay 74 4.13 74 63Vietnam 75 4.11 75 65Seychelles 76 4.10 n/a n/aGeorgia 77 4.07 76 88Romania 78 4.07 77 77Botswana 79 4.06 78 80Macedonia, FYR 80 4.04 79 79Croatia 81 4.04 80 76Armenia 82 4.02 81 92Guatemala 83 4.01 82 84Trinidad and Tobago 84 4.01 83 81Cambodia 85 4.01 84 97Ecuador 86 3.94 85 101Moldova 87 3.94 86 93Bosnia and Herzegovina 88 3.93 87 100Albania 89 3.91 88 78Honduras 90 3.88 89 86Lebanon 91 3.88 90 89Namibia 92 3.88 91 83Mongolia 93 3.87 92 96Argentina 94 3.87 93 85Serbia 95 3.87 94 95Greece 96 3.86 95 90Jamaica 97 3.84 96 107Gambia, The 98 3.83 97 99Gabon 99 3.82 n/a n/aTajikistan 100 3.80 98 105El Salvador 101 3.80 99 91Zambia 102 3.80 100 113Ghana 103 3.79 101 114Bolivia 104 3.78 102 103Dominican Republic 105 3.77 103 110Kenya 106 3.75 104 102Egypt 107 3.73 105 94Nicaragua 108 3.73 106 115Guyana 109 3.73 107 109Algeria 110 3.72 108 87Liberia 111 3.71 n/a n/aCameroon 112 3.69 109 116Libya 113 3.68 n/a n/aSuriname 114 3.68 110 112Nigeria 115 3.67 111 127Paraguay 116 3.67 112 122Senegal 117 3.66 113 111Bangladesh 118 3.65 114 108Benin 119 3.61 115 104Tanzania 120 3.60 116 120Ethiopia 121 3.55 117 106Cape Verde 122 3.55 118 119Uganda 123 3.53 119 121Pakistan 124 3.52 120 118Nepal 125 3.49 121 125Venezuela 126 3.46 122 124Kyrgyz Republic 127 3.44 123 126Mali 128 3.43 124 128Malawi 129 3.38 125 117Madagascar 130 3.38 126 130Cte dIvoire 131 3.36 127 129Zimbabwe 132 3.34 128 132Burkina Faso 133 3.34 129 136Mauritania 134 3.32 130 137Swaziland 135 3.28 131 134Timor-Leste 136 3.27 132 131Lesotho 137 3.19 133 135Mozambique 138 3.17 134 133Chad 139 3.05 135 142Yemen 140 2.97 136 138Guinea 141 2.90 n/a n/aHaiti 142 2.90 137 141Sierra Leone 143 2.82 n/a n/aBurundi 144 2.78 138 140GCI 20122013 GCI 20122013 26. 1.1: The Global Competitiveness Index 2012201314 | The Global Competitiveness Report 20122013Table 4: The Global Competitiveness Index 20122013 SUBINDEXES Innovation andOVERALL INDEX Basic requirements Efficiency enhancers sophistication factorsCountry/Economy Rank Score Rank Score Rank Score Rank ScoreSwitzerland 1 5.72 2 6.22 5 5.48 1 5.79Singapore 2 5.67 1 6.34 1 5.65 11 5.27Finland 3 5.55 4 6.03 9 5.30 3 5.62Sweden 4 5.53 6 6.01 8 5.32 5 5.56Netherlands 5 5.50 10 5.92 7 5.35 6 5.47Germany 6 5.48 11 5.86 10 5.27 4 5.57United States 7 5.47 33 5.12 2 5.63 7 5.42United Kingdom 8 5.45 24 5.51 4 5.50 9 5.32Hong Kong SAR 9 5.41 3 6.14 3 5.54 22 4.73Japan 10 5.40 29 5.30 11 5.27 2 5.67Qatar 11 5.38 7 5.96 22 4.93 15 5.02Denmark 12 5.29 16 5.68 15 5.15 12 5.24Taiwan, China 13 5.28 17 5.67 12 5.24 14 5.08Canada 14 5.27 14 5.71 6 5.41 21 4.74Norway 15 5.27 9 5.95 16 5.15 16 5.00Austria 16 5.22 20 5.63 19 5.01 10 5.30Belgium 17 5.21 22 5.52 17 5.09 13 5.21Saudi Arabia 18 5.19 13 5.74 26 4.84 29 4.47Korea, Rep. 19 5.12 18 5.66 20 5.00 17 4.96Australia 20 5.12 12 5.75 13 5.20 28 4.56France 21 5.11 23 5.52 18 5.04 18 4.96Luxembourg 22 5.09 8 5.96 24 4.87 19 4.89New Zealand 23 5.09 19 5.65 14 5.16 27 4.60United Arab Emirates 24 5.07 5 6.03 21 4.94 25 4.64Malaysia 25 5.06 27 5.38 23 4.89 23 4.70Israel 26 5.02 37 5.10 27 4.79 8 5.33Ireland 27 4.91 35 5.11 25 4.85 20 4.87Brunei Darussalam 28 4.87 21 5.56 68 4.05 62 3.64China 29 4.83 31 5.25 30 4.64 34 4.05Iceland 30 4.74 30 5.27 36 4.54 24 4.69Puerto Rico 31 4.67 48 4.86 33 4.61 26 4.64Oman 32 4.65 15 5.69 45 4.40 44 3.91Chile 33 4.65 28 5.35 32 4.63 45 3.87Estonia 34 4.64 26 5.47 31 4.63 33 4.06Bahrain 35 4.63 25 5.47 35 4.58 53 3.74Spain 36 4.60 36 5.11 29 4.67 31 4.14Kuwait 37 4.56 32 5.21 75 3.98 86 3.36Thailand 38 4.52 45 4.89 47 4.38 55 3.72Czech Republic 39 4.51 44 4.89 34 4.59 32 4.13Panama 40 4.49 50 4.83 50 4.36 48 3.83Poland 41 4.46 61 4.66 28 4.69 61 3.66Italy 42 4.46 51 4.81 41 4.44 30 4.24Turkey 43 4.45 57 4.75 42 4.42 50 3.79Barbados 44 4.42 38 5.09 49 4.37 38 3.97Lithuania 45 4.41 49 4.84 46 4.38 47 3.83Azerbaijan 46 4.41 56 4.76 67 4.05 57 3.68Malta 47 4.41 34 5.12 40 4.46 46 3.85Brazil 48 4.40 73 4.49 38 4.52 39 3.97Portugal 49 4.40 40 4.96 44 4.40 37 4.01Indonesia 50 4.40 58 4.74 58 4.20 40 3.96Kazakhstan 51 4.38 47 4.86 56 4.24 104 3.25South Africa 52 4.37 84 4.28 37 4.53 42 3.94Mexico 53 4.36 63 4.64 53 4.31 49 3.79Mauritius 54 4.35 52 4.80 62 4.14 63 3.63Latvia 55 4.35 54 4.79 48 4.37 68 3.57Slovenia 56 4.34 39 5.05 55 4.25 36 4.02Costa Rica 57 4.34 67 4.61 60 4.18 35 4.04Cyprus 58 4.32 42 4.94 43 4.41 51 3.77India 59 4.32 85 4.26 39 4.48 43 3.94Hungary 60 4.30 55 4.78 52 4.32 58 3.68Peru 61 4.28 69 4.57 57 4.23 94 3.31Bulgaria 62 4.27 65 4.63 59 4.18 97 3.30Rwanda 63 4.24 70 4.56 94 3.77 60 3.66Jordan 64 4.23 66 4.61 70 4.03 52 3.74Philippines 65 4.23 80 4.35 61 4.17 64 3.60Iran, Islamic Rep. 66 4.22 59 4.69 90 3.81 77 3.46Russian Federation 67 4.20 53 4.79 54 4.26 108 3.16Sri Lanka 68 4.19 72 4.50 77 3.96 41 3.96Colombia 69 4.18 77 4.40 63 4.13 66 3.58Morocco 70 4.15 68 4.60 79 3.94 84 3.38Slovak Republic 71 4.14 62 4.64 51 4.33 74 3.50Montenegro 72 4.14 74 4.49 74 3.99 69 3.57(Contd.) 27. The Global Competitiveness Report 20122013 | 151.1: The Global Competitiveness Index 20122013Table 4: The Global Competitiveness Index 20122013 (contd.) SUBINDEXES Innovation andOVERALL INDEX Basic requirements Efficiency enhancers sophistication factorsCountry/Economy Rank Score Rank Score Rank Score Rank ScoreUkraine 73 4.14 79 4.35 65 4.11 79 3.43Uruguay 74 4.13 43 4.91 73 4.00 78 3.46Vietnam 75 4.11 91 4.22 71 4.02 90 3.32Seychelles 76 4.10 46 4.86 91 3.81 87 3.36Georgia 77 4.07 64 4.63 87 3.84 120 3.00Romania 78 4.07 90 4.22 64 4.12 106 3.20Botswana 79 4.06 78 4.38 89 3.82 82 3.40Macedonia, FYR 80 4.04 71 4.52 84 3.85 110 3.13Croatia 81 4.04 60 4.68 72 4.01 83 3.39Armenia 82 4.02 76 4.41 82 3.86 98 3.29Guatemala 83 4.01 88 4.23 81 3.92 70 3.56Trinidad and Tobago 84 4.01 41 4.95 83 3.85 89 3.33Cambodia 85 4.01 97 4.14 85 3.84 72 3.53Ecuador 86 3.94 75 4.42 100 3.68 93 3.32Moldova 87 3.94 93 4.16 99 3.71 131 2.85Bosnia and Herzegovina 88 3.93 81 4.33 97 3.75 99 3.28Albania 89 3.91 87 4.24 92 3.80 113 3.11Honduras 90 3.88 101 4.08 102 3.66 91 3.32Lebanon 91 3.88 116 3.79 66 4.06 81 3.41Namibia 92 3.88 82 4.33 105 3.64 103 3.25Mongolia 93 3.87 92 4.17 96 3.76 112 3.11Argentina 94 3.87 96 4.15 86 3.84 88 3.35Serbia 95 3.87 95 4.15 88 3.83 124 2.96Greece 96 3.86 98 4.13 69 4.05 85 3.37Jamaica 97 3.84 114 3.82 80 3.93 80 3.41Gambia, The 98 3.83 103 4.01 114 3.54 54 3.74Gabon 99 3.82 86 4.25 116 3.52 139 2.64Tajikistan 100 3.80 105 3.97 112 3.56 76 3.46El Salvador 101 3.80 99 4.13 103 3.66 107 3.16Zambia 102 3.80 108 3.92 108 3.61 67 3.57Ghana 103 3.79 112 3.85 95 3.77 102 3.27Bolivia 104 3.78 94 4.15 122 3.35 100 3.28Dominican Republic 105 3.77 111 3.88 93 3.79 105 3.25Kenya 106 3.75 123 3.62 76 3.97 56 3.68Egypt 107 3.73 110 3.91 101 3.67 96 3.31Nicaragua 108 3.73 104 3.99 119 3.38 116 3.05Guyana 109 3.73 107 3.93 109 3.61 71 3.54Algeria 110 3.72 89 4.22 136 3.08 144 2.31Liberia 111 3.71 109 3.92 121 3.36 59 3.67Cameroon 112 3.69 115 3.80 111 3.57 95 3.31Libya 113 3.68 102 4.06 131 3.19 127 2.92Suriname 114 3.68 83 4.29 124 3.32 117 3.01Nigeria 115 3.67 130 3.52 78 3.96 73 3.53Paraguay 116 3.67 106 3.94 110 3.59 123 2.97Senegal 117 3.66 120 3.68 106 3.63 65 3.59Bangladesh 118 3.65 119 3.72 107 3.62 122 2.98Benin 119 3.61 113 3.83 125 3.31 111 3.12Tanzania 120 3.60 122 3.65 113 3.55 92 3.32Ethiopia 121 3.55 118 3.74 123 3.33 125 2.96Cape Verde 122 3.55 100 4.08 128 3.22 119 3.01Uganda 123 3.53 132 3.48 104 3.66 101 3.27Pakistan 124 3.52 134 3.41 98 3.71 75 3.47Nepal 125 3.49 121 3.65 126 3.30 133 2.82Venezuela 126 3.46 126 3.54 117 3.46 135 2.78Kyrgyz Republic 127 3.44 128 3.52 118 3.40 140 2.63Mali 128 3.43 125 3.55 127 3.26 114 3.11Malawi 129 3.38 135 3.40 120 3.37 109 3.16Madagascar 130 3.38 129 3.52 132 3.18 115 3.08Cte dIvoire 131 3.36 137 3.29 115 3.53 121 2.99Zimbabwe 132 3.34 127 3.53 135 3.08 128 2.90Burkina Faso 133 3.34 133 3.45 129 3.22 126 2.94Mauritania 134 3.32 124 3.60 142 2.88 118 3.01Swaziland 135 3.28 131 3.49 130 3.21 134 2.80Timor-Leste 136 3.27 117 3.78 138 2.97 136 2.73Lesotho 137 3.19 136 3.32 137 3.05 137 2.72Mozambique 138 3.17 138 3.22 133 3.10 130 2.89Chad 139 3.05 139 3.15 141 2.91 129 2.89Yemen 140 2.97 141 3.01 139 2.95 141 2.50Guinea 141 2.90 143 2.80 134 3.10 132 2.82Haiti 142 2.90 140 3.02 143 2.76 143 2.41Sierra Leone 143 2.82 144 2.77 140 2.94 138 2.69Burundi 144 2.78 142 2.94 144 2.56 142 2.42Note: Ranks out of 144 economies and scores measured on a 1-to-7 scale. 28. 1.1: The Global Competitiveness Index 2012201316 | The Global Competitiveness Report 20122013Table 5: The Global Competitiveness Index 20122013: Basic requirements PILLARS 3. Macroeconomic 4. Health andBASIC REQUIREMENTS 1. Institutions 2. Infrastructure environment primary educationCountry/Economy Rank Score Rank Score Rank Score Rank Score Rank ScoreAlbania 87 4.24 84 3.65 91 3.48 98 4.27 79 5.56Algeria 89 4.22 141 2.66 100 3.16 23 5.71 93 5.37Argen