COMPETITIVE LANDSCAPE
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IMD WORLD COMPETITIVENESS REPORT 2012
Published at the end ofMay, the IMDWorld Competitive- nessYearbook 2012 ranks Ireland as follows: 20th overall, up from24th in 2011 1st for skilled labour and for flexibility and adaptability 2nd for lack of protectionismand for foreign investors 3rd for labour productivity and for exports of commer- cial services
4th for real corporate taxes 5th for inward investment flows 10th for business efficiency, up eight places from2011
BarryO’Leary,CEOof IDAIreland has particularlywel-
comed the IMDfinding in relation to skills: “Competition for foreign direct investment (FDI) is significantly increas- ing and the availability of skilled labour is, amongst other things, one of themain deciding factorswhen companies are choosing a location for their overseas investments,” he says. “The fact that Ireland continues to lead theway in avail-
ability of skilled labour adds significantly to our reputa- tion as a host for FDI and the outlook formaintaining this position in the future remains positive. For example, greater availability of computer and software personnel will be a key feature for investors in Ireland over the com- ing years.” Elsewhere, Ireland ranks second for business legisla-
tion/openness to foreign investors; for large corporations that are efficient by international standards; and for adaptability of companies. It comes in fourth for corporate tax rate on profit and real corporate taxes. Themost competitive of the 59 ranked economies in 2012
“Progress continues in terms of basic physical infrastructure but there are still constraints in terms of access to credit, ven- ture capital for start-ups and general entrepreneurship sup- port. Ireland has a strong advantage as it has a culture that cultivates entrepreneurship, but this needs to be supported in terms of the establishment of start-ups.” If Ireland is to advance on the path of sustainable competi-
tiveness it needs to adopt austerity measures, but these must be combinedwith growth initiatives, Rosselet-McCauleymain- tains. “Cuts can only achieve somuch in isolation. They need to be
married to a growth agenda in order to deliver sustained and structural change. “Secondly, themindset needs to adapt.We are living in times
of unprecedented global uncertainty. It’s no longer enough to reap the benefits of past successes. Past competitiveness is no guarantee of future success. “Ireland needs to advance in times of adversity, invest in the
future and implement the necessary long-term measures for sustainable competitiveness.”
areHongKong, theUSand Switzerland. Despite all of its setbacks, theUSremains at the heart ofworld competi- tiveness because of its unique economic power, the dynamismof its enterprisesandits capacityfor innovation. “UScompetitivenesshas adeepimpact onthe rest of the
worldbecause it isuniquely interactingwithevery economy, advancedor emerging,” saysProfStephaneGarelli,director of IMD’sWorldCompetitivenessCentre. “No othernation canexercise sucha strong ‘pull effect’ ontheworld. “Europe is burdenedwith austerity and fragmented
political leadership and is hardly a credible substitute, while a South-South bloc ofemergingmarkets is still a work in progress. In the end, if theUScompetes, theworld succeeds!" Themost competitive nations in Europe are Switzerland
(ranked third), Sweden (fifth) andGermany (ninth),which have export-orientedmanufacturing and fiscal discipline. Meanwhile, Ireland, Iceland (26) and Italy (40) look bet-
ter equipped to bounce back than Spain (39), Portugal (41) andGreece (58),which continue to scare investors, according to IMD.
Issue 4 Spring/Summer 2012 INNOVATION IRELAND REVIEW 29
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