SINGAPORE, Oct 10 — Singapore has climbed to the top of the annual world rankings for competitiveness by the World Economic Forum (WEF), beating the United States, Hong Kong and the Netherlands to the spot.

Previously, it was the second most competitive economy behind the US in last year’s WEF Global Competitiveness Report, which evaluated countries along 12 basic pillars, including the strength of their institutions, capability for innovation and workforce skills.

However, the 666-page report that was released yesterday also said that Singapore needed to do more to improve worker skills, and that "its performance is undermined by limited checks and balances, and a lack of commitment to sustainability”.

For all nations, the WEF highlighted other focus areas beyond economic growth: Tackle the problem of inequality using inclusivity, and work together towards a sustainable environment. 

The report assessed 141 countries, covering 99 per cent of the global economy this year. 

The WEF is a Swiss non-profit organisation best known for its high-profile annual meetings of top business leaders and politicians.

Professor Klaus Schwab, its founder and executive chairman, said that the findings serve as an annual yardstick for policymakers to look beyond short-term and reactionary measures and, instead, measure against a full set of factors affecting productivity.

In May, Singapore was similarly ranked ahead of the US and Hong Kong in a report by the Switzerland-based think-tank IMD World Competitiveness Centre, which covers fewer countries.

How Singapore stacks up

Competitiveness, a concept in accounting theory, means the attributes and qualities of an economy that allow for a more efficient use of the factors of production — namely capital and labour.

Increasing productivity in any nation is the most important factor driving economic growth, and there is strong evidence showing that sustained economic growth is "the most effective way to lift people out of poverty and increase their quality of life”, the report noted.

With the latest results, policymakers may see how their countries are shaping up in 103 indicators surveyed or tracked by the WEF and aggregated to 12 pillars that determine the country’s competitiveness.

Based on this, countries are given scores from zero to 100, with 100 being the point at which the issue stops being a constraint to productivity growth.

Here is how Singapore fared: