In the changing global landscape, measuring the competitiveness of a country has become a crucial indicator of national success and sustainable economic growth. It reflects the situation of a nation and allows us to visualize whether it is a state where one can invest, consume, and engage in various economic activities. In other words, the competitiveness indicator can promote investment, consumption, and the improvement of the individual well-being of each person. This situation ultimately reflects the growth and sustainability of the country’s economy. At the international level, there is the World Competitiveness Ranking, a classification that evaluates countries’ ability to compete in the global arena through various indicators and factors such as the business environment, infrastructure, political stability, and economic performance.
One of the most exciting regions to assess in the ranking is the Indo-Pacific, which comprises successful countries and countries facing significant challenges.
In this region, Singapore stands out as a leader in terms of competitiveness. This country has remained within the top five positions in the World Competitiveness Ranking for the past five years. Its robust economy, efficient government, and a strong focus on innovation have established Singapore as a regional powerhouse. Furthermore, its strategic location, business-friendly policies and investment in human capital have contributed to its worldwide recognition for high levels of competitiveness. Despite challenges posed by the COVID-19 pandemic, Singapore has demonstrated resilience and adaptability, positioning itself as a global hub for trade and finance.
Similarly, China is considered a global power in terms of competitiveness. Implementing policies that provided significant opportunities to domestic and foreign companies in international trade, manufacturing, technology, and infrastructure has positioned China in sixth place in the world competitiveness ranking and as the second-largest economy in the world. However, this country still faces various challenges that limit its potential for competitiveness and, consequently, its economy, such as the lack of intellectual property protection, trade barriers, and lack of transparency in its business system.
India is another country in the region that has made notable advances in competitiveness, currently ranking 40th globally. This country has identified its comparative advantage in international trade (a vast market and human capital) and, based on this information, decided to implement economic reforms and promote digital transformation to improve its business environment and attract investments. Although significant challenges in infrastructure and bureaucratic obstacles persist, India’s commitment to fostering innovation and foreign private investment can potentially boost its future competitiveness.
On the other hand, Vietnam has emerged as a rising star in the region. Although not considered in the world ranking, Vietnam is recognized as a region with growth potential. This recognition has been achieved because, in recent years, Vietnam has attracted foreign direct investment and diversified its export markets by implementing proactive economic policies, trade liberalization, and infrastructure investments. Additionally, the country’s dynamic manufacturing sector and its young and skilled workforce contribute to its growing competitiveness.
The national realities of each of the countries above show that the Indo-Asia region presents a diverse landscape in terms of competitiveness. Therefore, it is essential to recognize the unique challenges faced by each country and the efforts they make to continuously improve their national situation.
Looking into the future, Indo-Pacific countries can further strengthen their competitiveness by addressing specific issues and challenges. From the perspective of organizations and institutions such as the World Competitiveness Center of the IMD (International Institute for Management Development) and the World Economic Forum, improving governance, reducing bureaucracy, enhancing infrastructure, and fostering innovation ecosystems can significantly contribute to the overall competitiveness level and economic situation of the Indo-Asia region.
In conclusion, competitiveness encompasses various dimensions beyond economic indicators. Estimating the level of competitiveness in a country not only reflects its actual situation but also creates possibilities to stimulate and promote sustainable long-term economic growth, primarily through foreign investment. Therefore, if countries in the Indo-Pacific region aim to improve their economic situation and increase social and individual well-being, they must implement policies and regulations that incentivize sustainability practices, innovation, research, and investment in education and infrastructure that drive long-term competitiveness.
*Carlos Olaya Loayza is currently an Intern at Fundación Internacional Bases
Source: We Are Innovation
