Must be the mountain air: Yet again, Swiss have world’s most competitive economy

GENEVA (Reuters) – Switzerland is the world’s most competitive economy for the ninth straight year, the Geneva-based World Economic Forum said on Wednesday.

Since suffering a rare blip in 2008, when it was nudged into second place by the United States, the Swiss economy has maintained an efficient but unshakable grip on the top spot in the WEF annual ranking.

WEF economist Thierry Geiger said Switzerland had a virtuous circle of infrastructure, institutions and education, but at the heart of its success was the way it created and used talent.

“That is really the secret of Switzerland, this ability to innovate, supported by a whole range of enabling factors,” he said.

However, after almost a decade at the top, Switzerland is at risk from complacency and populism. The aging population could undermine the innovation miracle by shutting the door to foreign talent in one of the referendums that make Swiss law, Geiger said.

“We see a proliferation of such referendums on everything,” he said. “Some of them are kind of dangerous; they could really endanger and jeopardize Switzerland’s prosperity.”

The World Economic Forum, the same organization that runs the Davos meeting of global power brokers each January, bases its rankings on a dozen drivers of competitiveness and a survey of business leaders.

“Global competitiveness will be more and more defined by the innovative capacity of a country,” WEF founder and executive chairman Klaus Schwab said in a statement.

Besides Switzerland, the top 10 remained the same as a year ago, although there was some shuffling of the order. The United States climbed over Singapore into second place, and Hong Kong jumped three places to sixth, leapfrogging Japan in ninth spot.

Britain slipped one place to eighth. It has not yet dropped in the rankings because of its Brexit negotiations with the European Union, but it is expected to do so, the WEF said.

China inched up one place to 27th, well ahead of 38th-ranked Russia and India, which was in 40th position.

The wooden spoon went to Yemen, a poor country further devastated by civil war, economic collapse, cholera and near-famine conditions, which was in 137th place.

Israel was ranked No. 24, behind Ireland and ahead of Malaysia.