Dr.Balraj KistowLok Jack GSB

The Global Competitive Report• Produced by the World

Economic Forum

• Based on the Global Competitiveness Index (GCI)

• Captures information on the micro and macro economic foundations of national competitiveness.

Relevance and Importance

• Provides decision-makers with an assessment of the factors that enable economies to achieve sustained economic growth and long term prosperity.

• Provides benchmark tools to identify obstacles to improved competitiveness at a national level.

• Performance assessed at a global level – information collected for 138 countries.

Competitiveness

“

”

The set of institutions, policies, and factors that determine the level of productivity of a country.

Effect of Productivity

Productivity

Higher Income

The level of productivity, in turn, sets the level of prosperity that can be earned by an economy.

Implied Framework National

Competitiveness

Firm Competitiveness

Enabling Environment

Firms compete not nations.

Government largely responsible for the raw conditions

Classification

1. Rank - out of total participants

2. Scores out of 7I. Overall Score – weighted average of 12 pillarsII. Sub-indices and Pillar III. Indicators

3. Problematic factors for doing business

The Results

Report HighlightsGCI 2016/17

Competitiveness Agendas to Reignite Growth

• Launched at a time of:• Rising income inequality,

• Slow productivity growth

• Mounting social and political tensions, and;

• Uncertainty fuelled by: • financial market fragility, geopolitical tensions, slow growth and

high debt in emerging economies.

Global Growth

• Growth remains persistently low:

• Commodity prices have fallen

• Trade has declined

• External imbalances are increasing

• Government finances are stressed.

Geopolitical Crossroads

More inward-looking policies & mounting protectionist pressures

General questioning of the premises underlying globalization (Brexit)

Stagnating and unequally distributed income growth

Slowing Productivity Growth Rising Income Inequality Aging Population

Fourth Industrial Revolution

• Based on digital platforms

• Characterized by a convergence of technologies that is blurring the lines between the physical, digital, and biological spheres

• New avenues of growth:• artificial intelligence, biotechnology, robotics, the

Internet of Things, and 3D printing

Trinidad and Tobago

• Innovation Driven economy - Stage 3

• GDP (US$ billions) - 24.6

• Per Capita Income (2015) - $US18,058 (2014) - $US21,311

(Source: IMF World Economic Outlook Database)

Overall Rank

Web of Pillars

Trinidad and Tobago is on par or better in 10 of the 12 pillars when compared to other countries in Latin America and the Caribbean.

Web 2015 & 2016

Barbados Jamaica Trinidad and Tobago

Caribbean Comparison

Sub-Indices & Pillars 2016 -2017 2015-2016 2014-2015

Rank Score Rank Score Rank Score

Basic Requirements 82 4.4 62 4.6 52 4.8

1st pillar: Institutions 107 3.4 108 3.4 95 3.5

2nd pillar: Infrastructure 54 4.3 51 4.5 52 4.5

3rd pillar: Macroeconomic environment 114 3.9 54 4.9 38 5.4

4th pillar: Health and primary education 61 5.9 60 5.9 59 5.9

Efficiency Enhancers 76 4.0 78 3.9 81 3.9

5th pillar: Higher education and training 74 4.3 73 4.3 77 4.2

6th pillar: Goods market efficiency 103 4.0 104 4.1 101 4.1

7th pillar: Labor market efficiency 89 4.0 96 4.0 96 4.0

8th pillar: Financial market development 61 4.1 56 4.0 52 4.3

9th pillar: Technological readiness 50 4.7 59 4.2 64 4.0

10th pillar: Market size 99 3.0 102 3.0 112 2.9

Innovation and Sophistication Factors 83 3.5 81 3.5 88 3.5

11th pillar: Business sophistication 67 3.9 68 3.9 69 3.9

12th pillar: Innovation 105 3.0 101 3.1 100 3.0

Microeconomic Environment 2016-2017 2015-2016 2014-2015 2013-2014

Value Rank Value Rank Value Rank Value Rank

Overall 3.9 114 4.9 54 5.4 38 52 5.1

Government surplus/deficit (% GDP) -9.5 128 -4 92 -2.3 58 -1.6 51

National savings rate (% GDP) 8.0 128 22.1 58 24.2 46 25.6 43

Inflation (annual % change) 4.7 96 7.0 118 5.2 93 9.3 129

Government debt (% GDP) 51.1 74 37.6 57 30.6 37 39.7 68

Country Credit Ratings (1 - 100 best) 49 63 46 64.7 42 62.6 43

Institutions 2016-2017 2015-2016 2014-2015

Rank Value Rank Value Rank Value

Overall 107 4.3 108 3.4 3.5 95

1.01 Property rights 87 4.1 4 85 4.1 69

1.02 Intellectual property protection 98 3.6 3.4 99 3.2 94

1.03 Diversion of public funds 114 2.6 2.4 124 2.5 114

1.04 Public trust of politicians 118 1.9 1.8 128 2 123

1.05 Irregular Payment & Bribes 102 3.3 3.3 104 3.3 106

1.06 Judicial independence 55 4.2 4.3 51 4.6 41

1.07 Favoritism in decisions of government officials 134 1.9 1.9 137 2.1 137

1.08 Wastefulness of government spending 107 2.5 2.5 112 2.5 114

1.09 Burden of government regulation 87 3.2 3.3 77 3.5 70

1.10 Efficiency of legal framework in settling disputes 106 3.0 3.2 97 3.5 83

1.11 Efficiency of legal framework in challenging regs 95 3.0 3.1 94 3.1 90

1.12 Transparency of government policymaking 80 4.0 3.8 90 3.7 98

1.13 Business costs of terrorism 74 5.2 5.3 75 5.4 63

1.14 Business costs of crime and violence 132 2.5 2.4 136 2.3 141

1.14 Organized crime 116 3.8 3.9 117 4 112

1.16 Reliability of police services 126 2.8 3.1 116 3.1 117

1.17 Ethical behavior of firms 123 3.1 3.2 125 3.4 125

1.18 Strength of auditing and reporting standards 83 4.3 4.3 91 4.3 87

1.19 Efficacy of corporate boards 90 4.7 4.3 101 4.1 110

1.20 Protection of minority shareholders’ interests 111 3.6 3.4 118 3.5 116

1.21 Strength of Investor Protection 36 6.3 5.8 55 6.7 22

Productivity

Competitiveness

Long term Prosperity

Culture of Action/Inaction based

on relationship & Interest, not policy or

protocols

Institutional Inertia

Lack of Enforcement

Poor work ethic Corruption,

Inefficiency, lack of accountability and

ownership

Lack of trust and

confidence in systems

Summary

• Fell 5 places to 94 with slight decrease in score

• Macroeconomic Environment

• Problematic Factors

• Innovation and Sophistication Factors

• Lowest rank Caribbean country

• How do we move forward?