Down by 2
Barbados has fallen two notches in a highly regarded global competitiveness index, which is also pointing to major business dissatisfaction with Government bureaucracy, access to financing and the work ethic of Barbadians.
The World Economic Forum’s Global Competitiveness Report 2012-2013 has said that based on “the continued deterioration of the macroeconomic framework”, the island’s competitiveness position fell to 44th place amid 144 featured “economies”.
“With one of the lowest national savings rates (136) and one of the highest government debt levels (139), the macroeconomic conditions in the country (134) are strangling the access of businesses to financing through local equity markets (92), loans (79), or venture capital (94),” the report said.
“As a result, the business community continues to face important challenges in engaging in new investment projects. Notwithstanding these serious weaknesses, which sharply affect economic activity, the country still benefits from well- functioning institutions (24) and good infrastructure (22).
“Moreover, a very high quality educational system (11), a high use of ICT (32), and a fairly sophisticated business community (36) help foster innovation in a service-oriented economy despite the low research and development investment (72) and technological innovation capacity,” it added.
Beyond this, however, the Forum, which was assisted by the University of the West Indies’ Sir Arthur Lewis Institute for Social and Economic Studies, said based on research businesses here had reported a number of “most problematic factors for doing business”.
Topping the list was inefficient government bureaucracy, access to financing, poor work ethic in the national labour force, insufficient capacity to innovate, tax rates, and inflation.
They were less concerned about poor public health, corruption, policy instability, government instability, the adequacy of the workforce, crime and theft and tax regulations.
The competitiveness report did not offer much more optimism for the overall Latin American and Caribbean region when compared to its report on Barbados.
“Over the past year, although several countries have once again made good progress in raising competitiveness, the region as a whole continued to face important competitiveness challenges,” the report stated.
“These pertain in particular to a weak institutional set-up with high insecurity, poor infrastructure, inefficient allocation of production resources caused by insufficient levels of competition, and a low capacity to generate new knowledge to strengthen research and development innovation in the region.
“Addressing these weaknesses will allow countries in Latin America and the Caribbean to be better connected not only among themselves but also to the rest of the world, and to boost productivity levels,” it added.
Switzerland, Finland, Sweden, the Netherlands, Germany, and the United Kingdom were deemed among the world’s most competitive economies this year, in addition to the United States, Singapore, Hong Kong, and Japan. (SC)