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Latvia in the Global Competitiveness Report
2014-2015
Competitiveness
research at the
World Economic
Forum
Topical and regional
reports, index
development,
workshops,
training, and much,
much more…
We aim to measure what lies behind different growth paths
Korea, Rep.
Latvia
China
Cambodia
Source: IMF, World Economic Outlook database, October 2014 edition
What is competitiveness?
“The set of institutions,
policies, and factors that
determine the level of
productivity of a country,
taking into account its level
of development. The level of
productivity, in turn, sets the
level of prosperity that can
be earned by an economy”
Our framework: The 12 pillars of competitiveness
1.Institutions
5.Higher education
and training
11. Business
sophistication
2.Infrastructure
6. Goods market
efficiency
12. Innovation
3.Macroeconomic
environment
7. Labor market
efficiency
4.Health and primary
education
8. Financial market
development
9. Technological
readiness
10. Market size
Basic
Requirements
Efficiency
enhancers
Innovation and
sophistication
factors
The Global Competitiveness Index
Stages of development and the drivers of competitiveness
Competitiveness
drivers
Innovation
Factor-driven
stage
Transition
stage
Efficiency-driven
stage
Transition stage
Innovation-driven stage
Efficiency
$17,000
$9,000
$3,000
$2,000
Basic
GDP per capita
US$ (not to scale)
The GCI
data
Examples
• 113 individual indicators
populating the different pillars
• 20,000 data points in total
• Data sources include
international organisations
and the World Economic
Forum’s Executive Opinion
Survey
The Global Competitiveness Index 2014-2015 Rankings
Rank Country/Economy
Score (1-7) Prev. rank
Rank
Country/Economy
Score (1-7) Prev. rank
1
Switzerland
5.7
1
34
Indonesia
4.6
38
2
Singapore
5.6
2
35
Spain
4.6
35
3
United States
5.5
5
36
Portugal
4.5
51
4
Finland
5.5
3
39
Mauritius
4.5
45
5
Germany
5.5
4
42
Latvia
4.5
52
6
Japan
5.5
9
49
Italy
4.4
49
7
Hong Kong SAR
5.5
7
52
Philippines
4.4
59
8
Netherlands
5.5
8
53
Russian Federation
4.4
64
9
United Kingdom
5.4
10
56
South Africa
4.4
53
10
Sweden
5.4
6
57
Brazil
4.3
56
12
United Arab Emirates
5.3
19
61
Mexico
4.3
55
15
Canada
5.2
14
68
Vietnam
4.2
70
20
Malaysia
5.2
24
71
India
4.2
60
23
France
5.1
23
81
Greece
4.0
91
26
Korea, Rep.
5.0
25
127
Nigeria
3.4
120
28
China
4.9
29
134
Myanmar
3.2
139
29
Estonia
4.7
32
140
Angola
3.0
142
33
Chile
4.6
34
144
Guinea
2.8
147
The Global Competitiveness Landscape
GCI 2014-2015 rank
Top 10
10-25
26-50
50-75
76-100
100-144
= Top 10 economies
The Global Competitiveness Report 2014-2015
• Reforming for prosperity
Monetary policy has to a large extent driven the global
recovery thus far, but sustaining this trend will depend
on successfully implementing structural reforms.
• Smart investment in skills and innovation
Those economies that consistently rank high in the
competitiveness rankings are those that able to develop,
attract and retain talent and can constantly introduce
new higher value added products and services into the
market
• Public-private collaboration
Cooperative leadership among business, government
and civil society is needed in order to get the world back
to sustainable growth and rising living standards.
Latvia’s competitiveness in regional comparison
The competitiveness divide in Europe
European reformers versus non-reformers
GCI 2014-15
Change to
previous year
GCI 2014-15
Change to
previous year
Finland
4
-1
Czech Republic
37
9
Germany
5
-1
Lithuania
41
7
Netherlands
8
0
Latvia
42
10
United Kingdom
9
1
Poland
43
-1
Sweden
10
-4
Malta
47
-6
Denmark
13
2
Italy
49
0
Belgium
18
-1
Bulgaria
54
3
Luxembourg
19
3
Cyprus
58
0
Austria
21
-5
Romania
59
17
France
23
0
Hungary
60
3
Ireland
25
3
Slovenia
70
-8
Estonia
29
3
Slovak Republic
75
3
Spain
35
0
Croatia
77
-2
Portugal
36
15
Greece
81
10
Country
Sources: IMF, World Economic Outlook 2014
Country
Latvia – towards improved competitiveness
?
Latvia’s score in the 12 pillars of the GCI 2014-2015
Latvia’s score in the 12 pillars of the GCI 2014-2015
Innovation-driven
Latvia’s score in the 12 pillars of the GCI 2014-2015
Latvia’s performance in innovation and sophistication factor
Rank of EU 28
economies
Better
Latvia’s rank out of 144 economies
Worse
Latvia’s performance in public institutions – selected
indicators
Rank of EU 28
economies
Better
Latvia’s rank out of 144 economies
Worse
Latvia’s performance in infrastructure
Rank of EU 28
economies
Better
Latvia’s rank out of 144 economies
Worse
Latvia’s performance in tech readiness – selected indicators
Rank of EU 28
economies
Better
Latvia’s rank out of 144 economies
Worse
Latvia’s performance in higher education and training
Rank of EU 28
economies
Better
Latvia’s rank out of 144 economies
Worse
Bureaucracy, tax regulations and limited access to finance
impede Latvian businesses
From a list of 16 factors Latvian business leaders selected the five most problematic for doing business
Latvia – towards a knowledge-driven economy
1.Institutions
2.Infrastructure
3.Macroeconomic
environment
4.Health and primary
education
5.Higher education
and training
6. Goods market
efficiency
7. Labor market efficiency
8. Financial market
development
9. Technological readiness
10. Market size
11. Business sophistication
12. Innovation
Impressive progress made post-crisis:
improvements in market efficiencies
(goods, financial, labour) and the
macroeconomic and financial
environment (except access to finance)
Further strengthening of basic pillars of
a competitive economy needed:
institutions and infrastructure
Competitiveness-enhancing
investments in skills and innovation are
needed as the country is transitioning
towards the innovation-stage of
development