“Malaysia is the only economy (in South-east Asia) to register an improvement of two positions, driven by a strong rebound in economic performance, especially in international trade,” the Switzerland-based research group said in a statement today.
The top five most competitive economies in the world remain the same as in 2017, but their order changed.
The United States returned to the number one spot from fourth place in the preceding year, driven mainly by its strength in economic performance and infrastructure. It was followed by Hong Kong, Singapore, the Netherlands and Switzerland.
Singapore – which was unchanged at third place, globally, retained its lead among economies in South-east Asia, aided by its strong government efficiency.
However, the country "continues to be weakened by the high levels of private debt in the economy and the high price level, especially in real estate, which reduces quality of life and talent attraction,” IMD said.
Besides Malaysia, Japan (ranked 25th), South Korea (27th), and India (44th) saw slight improvements.
Asian countries that dropped a few rungs are Taiwan (17th), Thailand (30th) and Indonesia (43rd).
The Philippines experienced the most significant decline in the region, shifting nine places to 50th due to a decline in tourism and employment, the worsening of public finances and a surge in concerns over the education system, among others.
“Countries from the region that experience declines this year, with the exception of Taiwan, all show signs of a need to improve their tangible and scientific infrastructure,” said IMD.
The IMD World Competitiveness Center has been publishing the annual rankings since 1989.
This year, it benchmarked the performance of 63 economies based on more than 340 criteria measuring different facets of competitiveness.