Business Irish

Tuesday 20 February 2018

Economic environment hits Irish competitiveness

Philip Pilkington

Ireland has fallen from the 22nd most competitive nation in the world to 29th place according to a new report by the World Economic Forum (WEF) which pointed to the poor macroeconomic environment as a key reason for it slipping down the tables.

The report states that while Ireland still has an 'innovative business cultures' and a good education system, weaknesses in it's banking and finance sectors together with a sluggish macroeconomy have led the WEF to reconsider its rating downward over the past three years.

The report says that the Irish economy is also hindered by an inefficient government bureaucracy, restrictive labour regulations and a lack of sufficient infrastructure. Uncertain access to financing is also dragging down the economy, according to the report.

However, there was some light at the end of the tunnel with Ireland being ranked 10th in terms of health and primary education and 22nd in terms of higher-level education.

This indicates that the Irish workforce still rank among the best in the world and the report states that Ireland's work ethic is still commendable.

The report also ranked Ireland 22nd with regards to 'business sophistication' and 23rd in terms of 'innovativeness', further indicating that it is the broader economy that is causing our ratings to slip rather than any deficit of skills or talent.

Ireland's fiscal balances are ranked last out of all 142 countries while the country's financial markets have slid from 7th place three years ago right down the table to 115th due to unsound banks and lack of access to loans.

The report from the Geneva-based institution ranked Switzerland the most competitive economy in the world, followed by Singapore in 2nd place and Sweden in 3rd.

The United States fell for the third year in a row to 5th place while the United Kingdom climbed up to 4th.

Germany follows these as a strong eurozone contender in 6th place, with the Netherlands in 7th. It's not all good news on the continent though, with France falling to 18th and Greece sliding right down to 90th in the table.

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