S. Korea`s global competitiveness ranking dips to 13th place: report

By Lee Joon-seung
SEOUL, Oct. 8 (Yonhap) -- South Korea's global competitiveness dipped two notches
over the past year mainly due to structural inefficiency and lack of corporate
reform, a Geneva-based economic organization said Wednesday.
The report compiled by the World Economic Forum (WEF) and released here by South
Korea's finance ministry, showed the country's competitiveness index edging down
to 13th place from the previous year's 11th among 134 countries reviewed.
The WEF attributed the drop to inefficiency in the labor, consumer and financial
markets, and slow pace of corporate reforms and general decline in willingness to
adopt new technologies.
Shortcomings in the labor market fell the most out of 12 categories examined,
hitting 41st place from 24th in the previous estimation.
This was followed by sharp drops in rankings for the financial market and
efficiency in the goods market, that covers consumer quality, import duties
and foreign ownership rules.
Maturity of the financial sector, including health of banks, and capital movement
were down to 37th place from 27th in the 2007 findings, while those for the goods
market fell to 13th from seventh place.
The Swiss institute also said that South Korea lost ground in size of the
consumer market, that fell to 13th from 11th in last year's tally.
Other areas that contributed to the decline in the ranking was the corporate
sector, where the country suffered from relative weakness in goods services and
advanced production processes.
On the positive side, the WEF said the country's competitiveness moved up in
terms of basic social and industrial infrastructure, improved in macroeconomic
policy stability and gained points in health, welfare and basic education
categories.
The report, in particular, gave high marks for macroeconomic stability, which
rose from eighth place last year to fourth in the latest findings.
The finance ministry said that while the ranking slipped a few notches, the
report showed that South Korea was a highly competitive country.
"The reason why the country remained high on the scale is mainly due to its
efforts to continually improve efficiency and push for changes that are designed
to enhance competitiveness," it said.
The ministry in charge of the country's economy then added that Seoul is
committed to greater market liberalization, improving overall business
environment and upgrading all facets of economy to reflect best global practices.
The WEF report, meanwhile showed the United States holding onto first place that
it nabbed in 2007, with Singapore, Japan and Hong Kong coming in at fifth, ninth
and 11th place each.
Switzerland and Denmark came in at second and third on the scale with Sweden
placing fourth.
Taiwan was ranked 17th, with China and Russia reaching 30th and 51st place on the
scale.
The WEF is an independent international organization committed to improving the
state of the world. It releases the competitiveness report every year reflecting
factors that are deemed to be critical to global competitiveness including
macroeconomic environment and technological readiness.