Image for illustrative purpose only. Globally, the US achieved the best overall performance with a score of 85.6, ahead of Singapore and Germany. Image Credit: Istockphoto

Dubai: The UAE has been ranked 27th in the World Economic Forum’s Global Competitiveness Report 2018.

With a competitiveness index score of 73.4, the UAE leads the Gulf Cooperation Council (GCC) region in the global ranking of 140 countries.

Saudi Arabia took 39th position with a score of 67.5, Qatar is ranked 30th while Oman, Bahrain and Kuwait are ranked 47th, 50th and 54th respectively.

“The UAE has been leading the region in competitiveness in recent years thanks to its improved skill base, depth of its financial system and its business dynamism. Although the structural foundations of a competitive economy take a long time to build, the UAE is on the right track to become increasingly competitive in the years to come, especially if it can address some of its main areas for improvement,” Roberto Crotti, economist at the World Economic Forum, said.

The report observed that the changing nature of economic competitiveness in a world that is becoming increasingly transformed by new, digital technologies is creating a new set of challenges for governments and businesses.

“The report shows how difficult the competitiveness race that we take part in every year is. The rules of competition with other countries are changing constantly. This requires us at the authority, along with all our partners in the federal and local government, to work continuously to keep up with these changes and adjust plans and strategies to maintain the UAE’s leading position in global competitiveness indices,” Abdullah Lootah, director-general of the UAE’s Federal Competitiveness and Statistics Authority, said.

The 2018 report uses a brand new methodology to fully capture the dynamics of the global economy in the Fourth Industrial Revolution. Many of the factors that will have the greatest impact in driving competitiveness in the future have never been the focus of major policy decisions in the past. These include idea generation, entrepreneurial culture, openness, and agility.

The new tool maps the competitiveness landscape of 140 economies through 98 indicators organised into 12 pillars. For each indicator, using a scale from 0 to 100, it indicates how close an economy is to the ideal state or ‘frontier’ of competitiveness.

“The UAE has delivered a strong performance [27th] and is one of the most vibrant economies in the region. In light of the new methodology, its main strengths are its excellent transport infrastructure [12th], ICT adoption [6th] and macro-economic stability [1st]. In addition, its institutions guarantee a high level of security [9th] and it has one of the most efficient public sectors in the world [5th],” Crotti said.

The UAE’s performance has come slightly closer to the frontier since 2017 thanks to improved skills base, depth of financial system and business dynamism. Although the structural foundations of a competitive economy take a long time to be built, UAE is on the right track to become increasingly competitive for the years to come, especially if it can address some of its main areas for improvement.

Globally, the US achieved the best overall performance with a score of 85.6, ahead of Singapore and Germany.

One of the report’s most concerning findings is the relative weakness across the board when it comes to mastering the innovation process, from idea generation to product commercialisation.