By Stelios Orphanides
The World Economic Forum (WEF) said that Cyprus’s competitiveness rating rose to 4.30 units this year from 4.04 units the previous year, which allowed the island to climb 19 places on the Global Competitive Index.
Cyprus was placed on the same ranking with Botswana and Jordan, slightly behind Oman and South Africa and Hungary and ahead of Colombia, Georgia and Romania, the WEF said in a statement on its website on Thursday. The island was the fourth least competitive EU economy beating only, in addition to Romania, Croatia and Greece. Turkey was ranked 53.
Switzerland was again the most competitive country in the world this year out of 137 countries with 5.86 points followed by the US with 5.85 and Singapore with 5.71, the WEF said. The worst performers in competitiveness were Yemen with 2.74, Mozambique with 2.89 and Chad with 2.99. The EU’s most competitive economies were the Netherlands, Germany, Sweden and the UK.
The WEF which rated each economy based on criteria bundled together into 12 separate pillars, placed Cyprus on rank 25 of the goods and market efficiency pillar, comparably its highest ranking, rank 30 in infrastructure, 32 in technological readiness and 39 in health and primary education, same as in the case of labour market efficiency. It was also ranked 46th in higher education and training, 51st in institutions, 55th and 53rd in business sophistication and innovation respectively. The island was among the worst performers with respect to the market size, ranking at 109, financial market development, 108, and macroeconomic environment, for which it was ranked 97.
Details about the components of the above pillars showed that Cyprus lagged behind in efficiency of corporate boards, ranked 116, the WEF said. In addition, four years after the 2013 fiscal and banking crisis, Cyprus was ranked 127th in terms of soundness of banks, still plagued by non-performing loans roughly half of their portfolio, and 126 the in terms of government debt, which last year stood at 107.8 per cent of economic output.
As a result, the island was ranked 123rd with respect to access to loans, and 120th when it comes to getting financing from the local equity market, the WEF said. Also, Cyprus’s capacity for innovation was the only the world’s 110th best.
Τhe most problematic factors for doing business in Cyprus were identified as being access to financing with 19.5 points, government bureaucracy 19.4, lack of innovation capacity 11.1, inadequate infrastructure 10.9, restrictive labour regulations 10.2 and corruption 7.7, the WEF said.