The grand duchy ranked 12th in the 2019 IMD World Competitiveness ranking, dropping one place from its 2018 position.
Topping this year’s ranking, which reviews 63 economies through 235 indicators, was Singapore (+2 since its 2018 ranking), which IMD attributes to the city-state’s tech infrastructure, skilled labour availability and immigration-friendly environment, among other factors.
The ranking revealed that Europe across the board “struggled to gain ground with most economies on the decline or standing still”. The UK, with its Brexit uncertainty, slipped three places this year to 23rd. An exception to this Europe trend was Ireland, however, which rose to 7th place (+5 since 2018).
The grand duchy was among the top 5 in terms of economic performance, placing 4th in the category which measures macroeconomic factors and domestic economy strengths.
Among the challenges listed for the grand duchy for 2019 include the need for talent and “training and an attractive framework for foreign workers”, improving tax competitiveness also for startups and IP, the need for better digitalisation to improve efficiency of public governance, encouraging a more flexible, agile working environment, and to foster a more inclusive education system.
Overall, the grand duchy ranked 10th and 12th, respectively, in the government efficiency and business efficiency categories. In the infrastructure category, which does not look at physical infrastructure but rather measures on how effective current infrastructure is to deliver basic needs of business in terms of HR, tech or science resources, Luxembourg ranked 25th.
Asia outperforms, US slips
Following Singapore’s top ranking was Hong Kong in place 2 (no change since 2018), due to its favourable business and tax environment.
The US ranked third overall--falling from top place in 2018--attributed in part to USD fluctuations, as well as higher-than-normal price of fuel and weakened export activity in hi-tech.
Switzerland and the UAE ranked fourth and fifth, a +1 and +2 jump from 2018, respectively.