x Abu Dhabi, UAEThursday 27 July 2017

UAE moves into top 20 of world's most productive global economies

The UAE has moved into the ranks of the 20 most productive global economies for the first time, according to the World Economic Forum.

The competitiveness report noted the UAE's aggressive adoption of technologies. Above, a clean room at a Globalfoundries facility in Dresden Germany. Jeff Topping / The National
The competitiveness report noted the UAE's aggressive adoption of technologies. Above, a clean room at a Globalfoundries facility in Dresden Germany. Jeff Topping / The National

The UAE has moved into the ranks of the 20 most productive global economies for the first time, according to the World Economic Forum (Wef).

The Wef's latest "Global Competitiveness Report" - its annual survey of the most efficient and dynamic economies - puts the UAE at 19th, up five places from last year.

For the fifth consecutive year, Switzerland was ranked the most competitive economy in the world, ahead of Singapore, Finland and Germany.

The United States regained its top-five status, while the highest-ranked Middle East country was Qatar, at 13th.

The Wef, best-known for the annual congress of business and political leaders held at Davos, said: "The UAE's competitiveness reflects the high quality of its infrastructure, as well as its highly efficient goods markets. Strong macroeconomic stability and some positive aspects of the country's institutions - such as strong public trust in politicians and high government efficiency - round up the list of competitive advantages."

It added, however, that there was still room for improvement.

"Putting the country on a more stable development path will require further investment to boost health and educational outcomes," it said. "Raising the bar with respect to education will require not only measures to improve the quality of teaching and the relevance of curricula, but also measures to provide incentives for the population to attend schools at the primary and secondary levels."

The report is compiled by surveying 13,000 business leaders about their views on 12 criteria to measure the value of the "institutions, policies and factors that determine the level of productivity of a country".

On the UAE, the report said: "Higher oil prices have buoyed the budget surplus and allowed the country to reduce public debt and raise the savings rate. The country has also been aggressive at adopting technologies and in particular using information and communication technologies." Margareta Drzeniek Hanouz, the Wef's lead economist and one of the authors of the report, said the report was "very positive" for the GCC, but added there was "still room for more innovation in the UAE".

She said that the UAE ranked high on government efficiency indicators including transparency and the absence of "red tape" bureaucracy.

Qatar was praised for its "strong performance in terms of competitiveness [that] rests on solid foundations made up of a high-quality institutional framework, a stable macroeconomic environment, and an efficient goods market".

But the Wef warned that Qatar had to reduce its vulnerability to commodity price fluctuations via economic diversification.

Saudi Arabia came in at 20th in the rankings, two places down on last year. "The country has seen a number of improvements to its competitiveness in recent years that have resulted in more efficient markets and sophisticated businesses. High macroeconomic stability and strong, albeit falling, use of information and communication technologies for productivity improvements contribute to maintaining Saudi Arabia's strong position."

However, the Wef also noted low ratings for health care, education, training and labour market efficiency in Saudi Arabia.

 

fkane@thenational.ae