Azerbaijan rises in global competitiveness rating

10 October 2019 10:26 (UTC+04:00)

By Rasana Gasimova

Azerbaijan moved up 11 places in the Global Competitiveness Report in 2019 to become the 58th most competitive economy in the world, the World Economic Forum (WEF) has reported.

Singapore ranked first in the global competitiveness report flowed by the United States. Hong Kong, the Netherlands and Switzerland are also in the top five.

Compared to 2018 rating, this year Azerbaijan improved its position in the following indicators: Infrastructure, Institutions, Innovation, Labor Market Efficiency, Business Sophistication, Goods Market Efficiency, Macroeconomic Environment and Skills.

In general, Azerbaijan improved its position, in 8 out of 12 indicators. The country’s position declined in 3 indicators and retained its position in one indicator.

Azerbaijan is in the upper half of the ratings for such pillars as Business Sophistication (23rd place), Labor Market Efficiency (21st place), Goods Market Efficiency (23rd place), Infrastructure (38th place), Skills (48th place), Institutions (49th place), Market Size (67th place), ICT potential (69th place), Innovation (68th place).

Azerbaijan is in the lower half of the ratings in such pillars as Developed financial markets (96th place), Good health and primary education (98th place), Stable macroeconomic framework (103rd place).

The improvement in Azerbaijan's macroeconomic indicator is affected by the slowdown in inflation in the country in 2018. According to the Developed financial markets indicator, the WEF notes the improvement of small and medium-sized businesses financing, the growth of market capitalization, and the growth of insurance market premiums. Among the negative factors, a low level of lending to the private sector is indicated.

As to Business Sophistication indicator, the WEF notes a decrease in the cost of starting a business in Azerbaijan and reduction in the number of days required for registration.

According to the rating, Azerbaijan’s share in world GDP is 0.13 percent.

According to WEF estimates, the average annual growth of Azerbaijan’s GDP reached 1.3 percent over the past 10 years, and the average rate of foreign direct investment (FDI) over the past 5 years is 7.1 percent of GDP.

The Global Competitiveness Index (GCI) tracks the performance of close to 140 countries on 12 pillars of competitiveness. It assesses the factors and institutions identified by empirical and theoretical research as determining improvements in productivity, which in turn is the main determinant of long-term growth and an essential factor in economic growth and prosperity.

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