Nordic countries like Finland and Sweden place highly, with Finland in first place, Sweden third and Denmark fourth... countries like Denmark and Sweden spend a lot on reducing poverty and have among the most generous unemployment benefits in Europe (and, let's face it, the world)...
Singapore ranks at number six, just below Taiwan. So yes, Singapore is competitive, but its competitiveness is not the product, as we are incessantly told by our Dear Leader(s), of artificially depressed wage costs or our effective lack of any social security or unemployment benefit (except for maybe CPF). If that were the case, we would be far more competitive than Sweden. It would also mean that a place like Hong Kong should be topping the competitiveness charts, which it isn't.
I could think of at least 1 conspiracy theory about why driving down your populace's wages is good, even if it doesn't help competitiveness all that much.
World Economic Forum - Global Competitiveness Report 2005-2006
Unfortunately, the whole thing is 65 pounds. I'm curious about what it says, but not quite that curious. Some extracts from the executive summary:
On why Finland is top in the Growth Competitiveness Index:
The country owes its strong showing to one of the most innovative business environments in the world, particularly critical to driving productivity in the country, given its advanced stage of development.This is coupled with a very healthy macroeconomic environment, at a time when many other industrial countries are struggling in this area. The willingness of Finnish governments to run budget surpluses, so as to be able to meet future social commitments linked to the aging of the population is particularly impressive.This approach to macroeconomic policy highlights a degree of political maturity in Finnish society worthy of emulation. Furthermore, Finland has an institutional environment that is among the world’s finest: the business community operates in a climate of respect for the law, unusually low levels of corruption, and an openness and transparency which other countries would do well to study.
On decadent Western countries with unsustainable welfare systems remaining competitive:
There is no evidence that relatively high tax rates are preventing these countries from competing effectively in world markets, or from delivering to their respective populations some of the highest standards of living in the world.
A rebuke to Texas oilmen:
In his intriguing paper “The Environment as a Source of Competitive Advantage,”Allen Hammond offers interesting counter arguments to the prevailing idea that environmental regulations place a potential constraint on, or worse, pose risks for business. Increasingly, he explains, environmental and social development issues are also coming to be understood as a source of opportunity for new products
and services, new technology, and new markets.
A breakdown of the various components of the Growth Competitiveness Index is instructive; Singapore ranks 10th on the technology index, 4th on public institutions and 1st for macroeconomic environment. The report distinguishes between factor driven, efficiency-driven, and innovation-driven productivity improvements, with increasing degrees of complexity. The data for Singapore is unavailable, but we can all guess where we lost out (I recall Krugman's criticism of our using capital investment to boost GDP growth, rather than technology).
As for the Business Competitiveness Index, Singapore ranks 1st in Institutions and Technological readiness, 4th in Market efficiency, 5th in Infrastructure, 8th in Higher education and training, and 9th for its Macroeconomy and Innovation.
What is more interesting, though, is that we got a dismal 20th for Business sophistication and a hideous 69th for Health and primary education. Time to drop a large dollop of government moolah into both Medisave and Medishield.
[NB: Some might point out that though at present Medisave and Medishield both are financed by the individual, pumping government money just shifts the burden from the individual to the representative tax payer so you're not getting a free lunch. Which is why I always wonder why people are so happy about tax cuts or pork barrel schemes and view them as gracious boons granted by the generous divine government at their own (great) expense - it's your own money after all.
However, presumably the World Economic Forum judges that self-funded medical provision is unwise, or we would not be 69th in the ranking for Health and primary education (this assumes that our primary schools are not similarly atrocious).]
[Addendum: The Slanted Times' take:
Sept 29: "Singapore's top-notch economic management has propelled the Republic one place higher to sixth spot in a closely watched ranking of global competitiveness conducted by the Geneva-based World Economic Forum (WEF)... And one of Singapore's long-standing economic rivals, Hong Kong, slumped seven spots to 28th this year.
... 'The Nordic countries have consolidated their position at the top of the league,' said the WEF's chief economist, Mr Augusto Lopez-Claros. 'The main reason is these countries enjoy very good management. They do not have fiscal problems like France, Germany or Italy,' he told reporters.
Faced with an ageing population, Nordic countries are reforming now in order to maintain their welfare systems, he said."
[Ed: Of course, there's no word about how they maintain generous welfare systems yet stay competitive in the first place.]
Oct 7: "Compulsory education was made law only recently. From 2003, parents must enrol their children in school from Primary 1 to 6, or face penalties... The good news is that as the compulsory education law kicks in, the issue about low primary school enrolment should eventually resolve itself.
Other areas that may need improvement would be those that Singapore does badly in the competitiveness ratings. A look at the 2004 report is instructive. There is one indicator in which Singapore fares even worse than in primary school enrolment.
In freedom of the press, Singapore is ranked a dismal 98th out of 104.
Now that's another rating we should all beaver away at together to try to improve."
[Ed: HAHAHAHAHAHAHAHAHAHA. But then, just like North Korea, we have special cirumstances necessitating our unfree but nation-building press.]