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+4 on the Lausanne Count

A nice addition to the phenomenal success of Kazakhstan in the WEF rankings was also a fact that Kazakhstan ranks 32nd in the list of most competitive economies, according to IMD. This is the highest achievement of our country in the five years since the Swiss Institute included Kazakhstan in its annual survey. The main drivers of growth for us in the Lausanne table of rankings were the improvements in international trade and public finance.

In 2012, only one of the two last year's winners, Hong Kong, managed to keep on the top of the rankings of IMD (International Institute for Management Development). Then the U.S.A., Switzerland, Singapore, and Sweden follow in the list. Among the countries of Europe, Norway (8), Germany (9) and the Netherlands (11) showed high competitiveness, thanks to export-oriented manufacturing and strict financial discipline in these countries. According to the IMD, Ireland (20) and Iceland (26) look quite prepared for the return of economic stability, while Spain (39), Portugal (41) and Greece (58) continue "frightening" investors (see Table 1).

It should be noted that the years 2011–2012 were rather difficult for the developing economies in terms of retaining competitiveness, as they have yet developed immunity from the impact of turbulences occurring in the developed world. As a result, most of the economies of Eastern Europe, Asia and Latin America showed decline. Meanwhile, Russia was the only country among BRIC, which improved its position. Although the other economies of the said block of countries are still ahead of Russia, their dynamics in the current rankings is negative: China dropped to 23rd, India to 35th, and Brazil to 46th. It is noteworthy that the leader of the IMD’s rankings in terms of dynamics is the UAE, which is 12 points up to 16th.

Commenting on the results of the study, Director of the World Competitiveness Center, Professor Stephane Garelli, said: "The recession has made the world economy more fragmented and diverse. We see that the emerging economies are trying to shield themselves from global problems leaning on domestic demand and domestic business, while developed countries are resorting to re-industrialization. In both cases, the block of competitive economies is marked by intensification of nationalism and protectionism." With this, according to Mr. Garelli, the only country which is able to pull the world out of the recession and to improve the global competitiveness is the United States, whose economy, one way or another, interacts with the economies of all the countries, both developed and developing ones. "In the end, as long as the U.S.A. remains competitive, the rest of the world will be doing well," – the IMD Professor concluded.

Higher and higher

In the current year’s rankings, our country is 4 points up, coming close to Estonia (31); the latter is leading amongst the five post-Soviet states, ranked by IMD. Then it follows Lithuania (+9 to 36th), Russia (+1 to 48th), and Ukraine (+1 to 56th). In its moving to a higher position, Kazakhstan managed to outstrip some of the fast developing countries – the Czech Republic (33rd), Poland (34th), and India (35th).

The progress of our country is marked in all the four key factors influencing competitiveness. In particular, Kazakhstan is 7 points up to 28th by economic performance, +3 to 18th by government efficiency, +2 to 34th by business efficiency, and +3 to 43rd by infrastructure.

If to review sub-factors, today our evident advantages are in public finance (+9 to 5th), effective fiscal policy (+1 to 9th), and the labor market (+10 to 5th). There is great potential on the international trade sub-factor, which in the last year has shown the greatest dynamics. According to this index, we moved far up, +18 points to 21st.

However, Kazakhstan's competitiveness is constrained by high prices (-6 to 53rd), low access by business to sources of financing (+1 to 50th), inadequate research infrastructure (+3 to 52nd), and problems in healthcare and environmental protection (+2 to 53rd).

Overall, the competitiveness of Kazakhstan today is estimated by IMD at 66.892% of Hong Kong’s. In the list of countries with the population fewer than 20 million people we are back to 19th, and amongst our geographical block of countries (Europe – Middle East – Africa) we are up to 20th.

The scenery of competitiveness of Kazakhstan by 20 sub-factors is shown in Picture 1, and the list of our strengths and weaknesses can be found in the respective picture boxes.

Reforms and globalization

We would like to turn to the main findings, made as a result of the poll of 4,200 executives around the world, which is the basis for one-third of 329 criteria taken into account by IMF in the preparation of the rankings. The main trend marked by the researchers in 2012 was the growing skepticism of the businessmen, participated in the poll, about the need for economic reforms and the benefits gained by the countries from globalization.

Ireland, the developing countries of Asia, Qatar and the UAE, as well as Sweden and Switzerland, are those who assess the initiatives of their governments most positively. Meanwhile, Argentina, the Czech Republic and Spain showed more moderate attitude to the initiatives of their governments. The necessity for globalization is most recognized in Ireland, Scandinavian countries, Chile, OEA and Asian countries, while in Greece, Russia, most of the countries of Eastern Europe and Latin America, globalization is perceived more as an inevitable evil. It is noteworthy that in both cases France is at the bottom of the rankings list. In this country, the measures of strict economy are perceived as "the cure which is worse than the disease itself."

Talking about the achievements of Kazakhstan, we can add that the policy of economic reforms is supported mainly by local businesses (13th place amongst 59). The influence of globalization on Kazakhstan’s economy is assessed by IMD as rather negative (36th). Overall, this is all within the IMD’s theory about the new era of "Competitiveness 2.0", where the governments and companies are beginning to focus more and more on national priorities.

For more detailed information, please refer to www.imd.ch/wcc

 


Table of contents
New Frontiers ahead of us  Erkebulan Iliyasov 
No Changes with Banks  Editorial 
Grain Heights  Editorial 
· 2016 №1  №2  №3  №4  №5
· 2015 №1  №2  №3  №4  №5  №6
· 2014 №1  №2  №3  №4  №5  №6
· 2013 №1  №2  №3  №4  №5  №6
· 2012 №1  №2  №3  №4  №5  №6
· 2011 №1  №2  №3  №4  №5  №6
· 2010 №1  №2  №3  №4  №5/6
· 2009 №1  №2  №3  №4  №5  №6
· 2008 №1  №2  №3  №4  №5/6
· 2007 №1  №2  №3  №4
· 2006 №1  №2  №3  №4
· 2005 №1  №2  №3  №4
· 2004 №1  №2  №3  №4
· 2003 №1  №2  №3  №4
· 2002 №1  №2  №3  №4
· 2001 №1/2  №3/4  №5/6
· 2000 №1  №2  №3





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