Although Luxembourg ranked favourably when it came to macroeconomic stability it still had strides to make in other indicators such as transport.
Photo: Matic Zorman
Luxembourg has ranked 18th in the World Economic Forum’s 2019 Global Competitive Report, up a notch since the last ranking.
Topping the ranking, which provides insights into 141 economies, is Singapore. The Asian city-state outpaced the other economies in financial system development, infrastructure, health and labour market functioning. The US came in second, dropping a rank from 2018, and Hong Kong placed third.
The European countries to make it in the overall top 10 were the Netherlands (4), Switzerland (5), Germany, Sweden, UK and Denmark (7-10, respectively). Japan placed 6th. Luxembourg fared 10th in terms of European economies, with Europe and North America just behind Asia-Pacific in terms of the most competitive regions worldwide.
Grand duchy results
Luxembourg received top marks for its macroeconomic stability, tying with 32 other locations in this pillar, which takes into account inflation and debt dynamics. It also ranked best in the overall sub-category of future orientation of government, which combines government policy, vision and responsiveness to change, the legal framework’s adaptability to digital business models, as well as environment-related treaties, energy efficiency and renewable energy regulation. The grand duchy also fared well in human capital skills (17th).
Nevertheless, the country still needs to make strides when it comes to its innovation ecosystem, the report reveals. While the US topped the rankings in the subcategory of business dynamism, Luxembourg came in at 42nd overall, although its innovation capability fared better at 19th, a subcategory for which Germany took the lead.
According to the Luxembourg Chamber of Commerce, the ranking of the grand duchy has oscillated between rank 19-25 over the course of the year. The results from Luxembourg were garnered through not only authorities from the participating agencies but also via an executive opinion survey carried out in Luxembourg under the aegis of the Luxembourg Chamber of Commerce.
Other key findings
Among the other findings of the report are that the global economy is not well-prepared for a downturn, given that there was a slowdown in productive growth over the last decade.
In order to improve productivity, there needs to be not only policy-makers looking beyond monetary policy, but also a better balance between human capital investments and the integration of technology.