New Zealand has again jumped up a place on the Global Competitiveness Index this year, from 17th last year and 18th the year before.
The Index ranks countries based on performance indicators such as innovation, market size, market efficiency, infrastructure and business sophistication.
Countries in the top ten were Switzerland as number one, followed by Singapore, US, Germany, Netherlands, Japan, Hong Kong, Finland, Sweden and UK, with Australia 21st in the rankings.
New Zealand’s GDP per capita (currently US$40,000) has increased steadily along with the Index ranking.
BusinessNZ chief executive Phil O’Reilly says the ranking showcases the strength of country’s institutions and economic fundamentals, areas such as innovation, business sophistication and infrastructure still need improvement.
“In our progress towards becoming a more value-added, sophisticated exporter of goods and services, New Zealand performed ‘okay but could do better’ on factors such as collaboration for innovation, government purchasing fostering innovation, investment in R&D and training, availability of in-demand skills, availability of engineers and scientists, availability of finance for innovative start-ups, appetite for entrepreneurial risk, development of unique products and processes, companies’ control of international distribution of their products, and participation in value chains and clusters,” O’Reilly said.
“In New Zealand’s environment for business, areas for improvement include the compliance burden on business, restrictive regulations on hiring and firing, restrictive foreign investment rules, restrictions on hiring foreign labour, lack of ‘pay for productivity’ practices, and tax and benefit policies reducing incentives to work and invest.
“The Competitiveness Report found that New Zealand’s road and rail infrastructure were of a middling ranking but could be improved.
“Good scores were achieved for strategies for and use of ICT and for companies growing online sales.”