The United States no longer ranks as the world’s most competitive economy in the world, according to a new report published by the World Economic Forum on Tuesday.
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In 2019, Singapore replaced the U.S. as the country with the most competitive economy in the world. The U.S. slipped from first place to second on the list, plagued by challenges surrounding market concentration, worsening perceptions from business leaders of non-tariff barriers, a drop in U.S. healthy life expectancy and fewer digital skills among its population.
“Those countries which integrate into their economic policies an emphasis on infrastructure, skills, research, and development and support those left behind are more successful compared to those that focus only on traditional factors of growth,” said Klaus Schwab, executive chairman of the World Economic Forum.
Still, the U.S. remains an economic powerhouse, ranking first on the business dynamism pillar and second in innovation capability.
Behind Singapore and the U.S. in terms of economic dynamism were Hong Kong, the Netherlands, Switzerland, Japan, Germany, Sweden, the United Kingdom and Denmark, respectively.
Although the report found that there's a growing gap between the competitiveness of countries’ economies -- in part because rising trade tensions are fueling uncertainty -- some countries are actually benefiting from the trade feuds. That includes Singapore and Vietnam.
As a result of the 15-month long trade war between the U.S. and China, a number of companies have fled from Beijing, heading to neighboring countries like Thailand, Vietnam and Taiwan in droves, a recent report found. Vietnam was the report’s most-improved country in this year’s index.
Overall, the Asia-Pacific area was ranked as the most competitive, given the slew of competitive countries in the vicinity. It's followed by Europe and North America.