Singapore economy: Number 1 world's most competitive

In a difficult year for global trade and investors, Singapore has emerged as the world's most competitive economy, according to an updated global ranking.

It scored 84.8 out of a possible 100 and beat the United States to first place in the ranking of 141 economies. The last time Singapore came first was in 1999.

Amid the trade war in which it is engaged, the US scored 83.7, falling from last year's top position and a score of 85.6. Singapore scored 83.5 last year.

"Singapore improves from an already high base," the World Economic Forum said yesterday, adding that the country is first and foremost infrastructure - one of the index's 12 pillars.

Singapore was also number 1 for two of the other pillars of the index: the healthy life expectancy of citizens and the labour markets.

Trade and Industry Minister Chan Chun Sing said on Facebook yesterday that the rankings reflected how economic fundamentals here continue to distinguish Singapore from its competitors.

"Nevertheless, as a small and open economy, we cannot afford to take things for granted," he added.

Singapore must persist, given the current economic uncertainties, and provide its employees with the right skills, he said.

The report said that Singapore came in third place for the skills of the current workforce, but 28th for the skills of its future workforce.

Singapore also scored well because of its financial system, market efficiency and macroeconomic stability.

"Singapore ranks second for the quality of public institutions, behind Finland, but its performance is undermined by limited checks and balances," the report said.

"Singapore notably ranks 124th on the Freedom of the Press Index," the report added, saying that the country had a lack of commitment to sustainability.

The report said that Singapore must promote entrepreneurship to become a global innovation hub.

The difficulties in hiring foreign workers were also highlighted in the report, with Singapore in 93rd place.

CIMB Private Banking economist Song Seng Wun said the latest rankings showed the strong will of policymakers to make Singapore the preferred economy for doing business. But it is also a reminder of the limitations Singapore needs to learn to work with, he added.

An example is the relatively small population of 5.6 million, Mr. Song said. Singapore has attracted some of the world's top technology companies, such as Google, Facebook and LinkedIn, to establish offices here, but the local talent pool may not provide the expertise that these companies need, he said.

The gap between the skills of current and future employees underlines the need for lifelong learning, he added.

Associate professor Lawrence Loh of the National University of Singapore Business School said the rankings reinforce Singapore's status as a global investment hub - a factor that could help the economy.

The rise in Singapore was partly driven by the fall in US performance, which improved last year in terms of trade openness.

The report noted:  "Despite an overall weaker performance this year, the US remains one of the most competitive economies in the world. It is still an innovation powerhouse, ranking second on the innovation capability pillar and first in terms of business dynamism."

Hong Kong rose four places to third place. The report - which collects responses in the first quarter of the year, before the city's last political unrest in June - praised Hong Kong's financial system and macroeconomic stability.

The Netherlands, which beat two places to fourth place, and Switzerland, which fell one place, complete the top five of the most competitive economies.

The Global Competitiveness Report series was launched in 1979 to provide an annual assessment of the factors that affect productivity and long-term economic growth.