Ranking the Most Competitive Countries Around the World
Just as a well-made ship needs fair weather for a smooth voyage, businesses need a supportive ecosystem to start and stay successful.
Rankings for the most competitive countries attempt to quantify this support directly, seeing which economies have the best frameworks for business to thrive. Examining how the rankings change over time can also tell us a lot about how countries are progressing relative to others.
In the above graphic, Julie Peasley uses the World Competitiveness Ranking report by the International Institute for Management Development (IMD) to chart the top 20 most competitive countries between 2019 and 2023.
How is Business Competitiveness Measured?
IMD examines countries on the basis of four metrics across multiple sub-factors:
Economic performance:
Domestic economy, international trade, international investment, employment, prices
Government efficiency:
Public finance, tax policy, institutional framework, business legislation, societal framework
Business efficiency:
Productivity & efficiency, labor market, finance, management practices, attitudes & values
Infrastructure:
Basic infrastructure, technological infrastructure, scientific infrastructure, health & environment, education
These metrics are scored on a mix of hard statistics, surveys from partner institutes, and supplementary data.
Which Countries are the Best and Worst for Business?
Denmark holds on to the top spot as the most business-friendly country in 2023, after it ranked number one for the first time in 2022. The Scandinavian country has been a perennial top 10 performer since 2018 but really began its ascent to the summit in the last four years.
The country excels in the categories of business efficiency, government efficiency, and infrastructure metrics, despite comparatively average economic performance next to some of its geographic peers.
Close behind in second place is Ireland, jumping five spots since 2019. The country’s strong economic performance helped it break into the upper echelon after bouncing around the top-15 rankings in the last few years.
Ranked third is Switzerland which has been in the top five since 2018, and reached first place in 2021. While the country scores well on several key indicators, it loses points on subfactors like the lack of business development and IPO offerings.
Singapore, which also was previously ranked as the most competitive country in 2019 and 2020, secured fourth place in 2023. In contrast to Denmark and Switzerland, the Asian financial heavyweight scores well on economic performance but loses ground on government efficiency.
At the bottom of the list, Venezuela, Argentina, and Mongolia face significant challenges in business competitiveness in 2023. These countries suffer from a trifecta of poor economic performance, low business and government efficiency, and substandard infrastructure, hindering business growth and development. Macro developments also play a key factor in their fortunes. For example, Mongolia has suffered in the aftermath of sanctions on Russia, a key trade partner.
Changing Rankings for the Most Competitive Countries
Though some countries have placed consistently in the rankings of the most competitive countries, there are also countries that have seen more noteworthy fluctuations.
China and Germany were both in the top 20 rankings pretty consistently until 2022, but both fell just short of that benchmark in the 2023 rankings.
And the U.S. is still in the top 10 but has dropped six spots compared to other economies in the last five years. The country’s economic might is unimpeachable, but rankings slipped in the business landscape and government efficiency metrics.
Here are the five-year changes in rankings for all countries scored in the IMD report, sorted from biggest increase to largest decrease:
Country Change (2019-2023) Rank (2023)
Czech Republic +15 18
Belgium +14 13
Taiwan +10 6
Croatia +10 50
Saudi Arabia +9 17
Estonia +9 26
Greece +9 49
Denmark +7 1
Ireland +5 2
Finland +4 11
Iceland +4 16
Türkiye +4 47
India +3 40
Italy +3 41
Jordan +3 54
Switzerland +1 4
Netherlands +Ranking the Most Competitive Countries Around the World
Just as a well-made ship needs fair weather for a smooth voyage, businesses need a supportive ecosystem to start and stay successful. Rankings for the most competitive countries attempt to quantify this support directly, seeing which economies have the best frameworks for business to thrive. Examining how the rankings change over time can also tell us a lot about how countries are progressing relative to others.
According to the World Competitiveness Ranking report by the International Institute for Management Development (IMD), Denmark holds on to the top spot as the most business-friendly country in 2023, after ranking number one for the first time in 2022. The Scandinavian country has been a perennial top 10 performer since 2018 but really began its ascent to the summit in the last four years. Denmark excels in the categories of business efficiency, government efficiency, and infrastructure metrics, despite comparatively average economic performance next to some of its geographic peers.
Close behind in second place is Ireland, jumping five spots since 2019. The country’s strong economic performance helped it break into the upper echelon after bouncing around the top-15 rankings in the last few years. Ranked third is Switzerland, which has been in the top five since 2018 and reached first place in 2021. While the country scores well on several key indicators, it loses points on subfactors like the lack of business development and IPO offerings. Singapore, which was previously ranked as the most competitive country in 2019 and 2020, secured fourth place in 2023. In contrast to Denmark and Switzerland, the Asian financial heavyweight scores well on economic performance but loses ground on government efficiency.
At the bottom of the list, Venezuela, Argentina, and Mongolia face significant challenges in business competitiveness in 2023. These countries suffer from a trifecta of poor economic performance, low business and government efficiency, and substandard infrastructure, hindering business growth and development. Macro developments also play a key factor in their fortunes. For example, Mongolia has suffered in the aftermath of sanctions on Russia, a key trade partner.
Though some countries have placed consistently in the rankings of the most competitive countries, there are also countries that have seen more noteworthy fluctuations. China and Germany were both in the top 20 rankings pretty consistently until 2022, but both fell just short of that benchmark in the 2023 rankings. And the U.S. is still in the top 10 but has dropped six spots compared to other economies in the last five years. The country’s economic might is unimpeachable, but rankings slipped in the business landscape and government efficiency metrics.
Overall, the rankings for the most competitive countries provide valuable insights into the business environments around the world. They highlight the countries that are excelling in creating supportive ecosystems for businesses to thrive and those that still have significant challenges to overcome. As the global economy continues to evolve, these rankings will continue to be an important tool for businesses and policymakers alike.nomic performance, government inefficiency, and inadequate infrastructure. Venezuela, in particular, has been grappling with a severe economic crisis for years, resulting in hyperinflation and a decline in business opportunities.
Argentina, on the other hand, has struggled with political instability and high levels of corruption, which have hindered its business environment. Mongolia, despite its rich natural resources, has faced challenges in diversifying its economy and improving its infrastructure.
Overall, the rankings highlight the importance of a supportive ecosystem for businesses to thrive. Countries like Denmark, Ireland, and Switzerland have consistently demonstrated their commitment to creating favorable conditions for businesses, while others still have a long way to go in improving their competitiveness.
As the global economy continues to evolve, it will be crucial for countries to adapt and implement policies that foster innovation, attract investment, and promote sustainable growth. The rankings serve as a valuable tool for policymakers and businesses alike, providing insights into the strengths and weaknesses of different economies and guiding decision-making processes.
In conclusion, the IMD’s World Competitiveness Ranking offers a comprehensive assessment of the most competitive countries around the world. It highlights the importance of factors such as economic performance, government efficiency, business efficiency, and infrastructure in determining a country’s competitiveness. While some countries have consistently excelled in creating a supportive environment for businesses, others still face significant challenges. Moving forward, it will be essential for countries to prioritize policies that enhance their competitiveness and drive economic growth.
How does the PAA serve as a benchmark for countries to assess their progress in improving business competitiveness?
Serve as a benchmark for countries to assess their progress and implement necessary reforms to improve their business competitiveness.
Great insights on global competitiveness! It’s fascinating to see how these countries continue to strive for excellence and maintain their top positions in various sectors.
This article provides a fascinating perspective on global competitiveness, offering valuable insights into the ranking of the most competitive countries worldwide. It serves as a helpful resource for businesses and policymakers alike, emphasizing the importance of staying at the top spot in an increasingly competitive global market.