Lithuania Surpasses Estonia and Latvia in the World Competitiveness Ranking

6 June, 2013

According to IMD World Competitiveness Yearbook 2013, this year Lithuania has climbed from place 36 to 31, its performance being better than that of Estonia (down to place 36) and Latvia (41; assessed for the first time). Lithuania retains its leading position in the areas such as the information technology infrastructure and the number of employed women.

In this IMD report, the ranking of the states of the world is based on four factors: economic performance, government efficiency, business efficiency, and infrastructure. In Lithuania‘s case, the most remarkable progress is seen in business efficiency: 26 compared with 36 in the last ranking; economic performance and government efficiency have risen from place 46 to 43 and from 37 to 34 respectively; the score for infrastructure remained the same, i.e. 31.

“Generally, an analysis of Lithuania presented in the IMD competitiveness report shows that, compared with previous year, improvements are seen in public finance, fiscal policy, productivity and efficiency, labour market and management practice“, says Lina Vaitkevičienė, Deputy Managing Director of Versli Lietuva, an organisation conducting the study in Lithuania. “A deeper and more detailed analysis reveals that the improvement in economic performance is based on the positive change in the current account balance, active foreign direct investments by Lithuanian companies, real GDP growth, positive change in the trading balance, export growth trends, falling unemployment rates and improved cost-of-living index.“

According to L. Vaitkevičienė, the budget criterion under the government efficiency factor shows positive trends: while still having a budget deficit, Lithuania has climbed from place 21 to 17 according to the IMD WCY. There is less bureaucracy, investment incentives are better perceived by foreign investors, increased state support for business, more favourable legal environment for the establishment of new businesses, and closer social cohesion are noted. Improved business efficiency is demonstrated by the real growth in productivity (Lithuania ranks first according to this criterion), increased employee motivation, efforts in attracting and retaining talented people, improving business ethics, increasing customer satisfaction and attention to values while taking employees‘ needs into account.

A survey of company executives has shown that high level of educational attainment, competent labour force and sound infrastructure are the greatest advantages of our economy. It has been concluded, based on the survey results, that challenges in 2013 for Lithuania are to focus on the maintaining strong growth in exports, focusing on high added value products and services, increasing the energy independence, attracting foreign direct investments, and fostering environmentally-friendly innovations and entrepreneurship.

The US is at the top of the competitiveness ranking this year (last year: 2nd place), followed by: Switzerland (last year: 3), Hong Kong (1), Sweden (5), Singapore (4), Norway (8), Canada (6), UAE (16), Germany (9) and Qatar (10). This year‘s top ten no longer includes Taiwan which had scored 7 last year (now 11).

The World Competitiveness Yearbook compiled by the IMD World Competitiveness Centre is based on an assessment of 333 criteria, with two-thirds of the criteria comprised of statistical information and one-third of them based on the Executive Opinion Survey. This year‘s report covers 60 states of the world.