New Zealand has moved up to 18th place in the list of most competitive nations in the world, according to this year’s Global Competitiveness Index.
The Index ranks countries according to their performance on factors such as innovation, market size, market efficiency, infrastructure, business sophistication and others.
This year New Zealand has overtaken five countries, including Australia, to move its overall ranking to 18thplace, up from 23rd place in last year’s survey.
For BusinessNZ CEO Phil O’Reilly, this year’s results again highlight the strength and integrity of New Zealand’s institutions while pointing to the need for improvement in areas such as innovation, infrastructure, exports and bureaucracy.
“New Zealand ranks well on many issues, but the critical ones supporting innovation-driven exports are in need of improvement,” he says. “With one of our most problematic factors being ‘an inadequately educated workforce’, the consequences for innovation are obvious. Our economy has a critical need for more relevant skills. We urgently need to see more of the right applied skills coming out from our secondary and tertiary education institutions.”
O’Reilly believes there is a great need for collaboration with higher research bodies, at the business level, in order to drive higher-value higher-technology products. “With the establishment of Callaghan Innovation, we should see improved outcomes in future for business development based on science and technology,” he adds.
He says better industry-university collaboration (20th ranking) and more company spending on R&D (34th ranking) would help grow the numbers of new, innovative goods and services, while the low placing (74th) for size of foreign markets indicated the scope for extending more exports to more markets.
New Zealand ranked 2nd place overall for strength and integrity of institutions and achieved first place for ethical behaviour of firms, judicial independence, absence of bribes and absence of diversion of public funds. On the other hand, the country ranked 10th for wastefulness of government spending, 12th for property rights and 13th for burden of regulation.
The country ranked 22nd for patents per population, 20th for university-industry collaboration in R&D, 34th for company spending on R&D and 58th for availability of scientists and engineers.
The survey shows that the most problematic factors for doing business in New Zealand in 2013 were inadequate infrastructure, inadequately educated workforce, insufficient capacity to innovate and inefficient government bureaucracy.
The top ten places this year were similar to previous years’ rankings - Switzerland, Singapore, Finland, Germany, US, Sweden, Hong Kong, Netherlands, Japan and the UK.
The full survey results can be found here.