THE UK has become less competitive in the last year compared to its peer countries, according to a detailed global report published yesterday by the World Economic Forum.
Despite the government’s frequently cited pledge to improve Britain’s standing in the so-called global race, the UK slipped from eighth place in 2012 to 10th place in this year’s global competitiveness index (GCI).
Japan and Hong Kong leapfrogged the UK into ninth and seventh places respectively, while the top of the list is still dominated by Switzerland, Singapore and Finland.
While some European countries continue to hold healthy positions in the rankings – Germany (now fourth) and Sweden (now sixth) swapped places – many of the continent’s other states are failing to provide a competitive environment for business, a situation that could hamper the Eurozone’s emergence from its economic slump.
Despite moving up five places, Greece is still low down, ranked 91st out of the 148 countries included – faring worse than states such as Iran and Cambodia. Italy has slipped from 42nd to 49th, while Portugal moved from 49th to 51st.
Governments in these countries “all need to continue addressing weaknesses in the functioning and efficiency of their markets, boost innovation and improve access to finance in order to help bridge the region’s competitiveness divide,” the report’s authors said, arguing that the focus on fixing the debt crisis has distracted from improving competitiveness.
In the UK, access to finance was considered the most problematic factor for doing business, while tax rates and inefficient government bureaucracy were ranked in joint second place.
Other leading problems in the UK included an inadequately educated workforce and tax regulations.
Labour’s Chuka Umunna used the report to hit out at the coalition. “Things are getting harder, not easier, for our wealth creators under this out of touch government,” Umunna said.