• 
• 

 

 Meanwhile, Thailand's ranking slipped six places to the 34th.

 The report released by the World Economic Forum contributed the highest ranking to many structural features that make its economy extremely productive and place it on a strong footing to ride out business cycle shifts and economic shocks.

 Thus, despite rising concerns about the soundness of the banking sector and other macroeconomic weaknesses, the country's many other strengths continue to make it a very productive environment. The US is ranked first for innovation, and its markets support this innovative activity through their efficient allocation of resources to their most effective use.

 However, large macroeconomic imbalances over recent years, with repeated fiscal deficits leading to rising and burgeoning levels of public indebtedness, indicate that the country is not preparing financially for its future liabilities and is on the road to making interest payments that will increasingly restrict its fiscal policy freedom going into the future.

 Switzerland is in second position followed by Denmark , Sweden and Singapore . European economies continue to prevail in the top 10 with Finland, Germany and the Netherlands following suit. The United Kingdom, while remaining very competitive, has dropped by three places and out of the top 10, mainly attributable to a weakening of its financial markets.

 China continues to lead the way among large developing economies, improving by four places this year and joining the top 30.

Several Asian economies perform strongly with Japan, Hong Kong, Korea and Taiwan.

"Rising food and energy prices, a major international financial crisis and the related slowdown in the world's leading economies, are confronting policy-makers with new economic management challenges. Today's volatility underscores the importance of a competitiveness-supporting economic environment that can help national economies to weather these types of shocks in order to ensure solid economic performance going into the future," said Xavier Sala-i-Martin , Professor of Economics, Columbia University, USA, and co-author of the report.