IMD WORLD COMPETITIVENESS YEARBOOK 2019

2019 оны 6-р сар 13, Пүрэв гариг

The IMD World Competitiveness Center is presenting this year’s “IMD world competitiveness yearbook 2019”. Since 2010, the Economic Policy and Competitiveness Research Center (EPCRC) has been working with the IMD World Competitiveness Center and providing with necessary data to measure the competitiveness of Mongolia. The data include hard-statistical data and executive opinion survey.

IMD WORLD COMPETITIVENESS YEARBOOK 2019

The study ranks 63 different economies of the world. The ranking is calculated on the basis of 235 ranked criteria out of 332. Among the 235 criteria, 143 of them are from hard and 92 of them are from the survey data.

The IMD World Competitiveness Center presents the overall competitiveness rankings and the 5-year trends for each of the four Competitiveness Factors: Economic Performance, Government Efficiency, Business Efficiency, and Infrastructure. Thus, the reader is able to analyze the evolution of an economy’s performance over the past few years relative to the others on a global basis.

This year Singapore, Hong-Kong, and the USA ranked high in competitiveness whereas Argentina, Mongolia, and Venezuela captured the last positions. Russia and China, our two neighbouring countries are ranked at 45^th and 14^th.

COMPETITIVENESS OF MONGOLIA

Even though Mongolia kept the last year’s ranking of 62^nd out of 63 countries, its overall competitiveness score decreased.

Out of four main competitiveness factors, Economic Performance ranked the highest with the 58^th place (ranked at the 48^th last year).

Competitiveness landscape

As one can see from the graph above that a sub-factor called prices which include indices such as consumer price inflation, cost-of-living index, apartment and office rent ranked high compared to other countries.

On the other hand, sub-factors such as international trade, productivity & efficiency, management practices, technological infrastructure, scientific infrastructure, and health and environment ranked low.

Factors which affected the decrease in the overall competitiveness score:

Over the last one year, the criteria such as the total expenditure on R&D, government budget deficit, exports of commercial services, capital markets, and tourism receipts were highlighted the biggest improvements in the overall performance of the economy. On the other hand, the criteria such as consumer price inflation, current account balance, transparency, and pension funding were contributed to the biggest declines.

Apart from the aforementioned factors, some sub-factors such as employment, business legislation, health and environment, and education affected the declines in the overall economic performance of Mongolia.

CHALLENGES IN 2019

Impending foreign debt repayments may pose some risks for the growing economy.
Upcoming Parliamentary election may result in political instability and policy discontinuity.
Foreign Direct Investment may decrease due to the election.
Inflation may increase due to high domestic demand resulting from increased government expenditure.
Social and economic costs of severe air and soil pollution levels in urban areas are posing considerable challenges for the country.

STRENGTHS AND WEAKNESSES OF MONGOLIA

STRENGTHS WEAKNESSES


Economic Performance		Rank	Economic Performance		Rank
1.1.18	Gross fixed capital formation – real growth	1	1.2.17	Export concentration by partner	63
1.5.04	Office rent	1	1.2.02	Current account balance	63
1.1.14	Real GDP growth	2	1.2.12	Exports of commercial services ($bn)	63
1.3.06	Direct investment flows inward (% of GDP)3		1.2.18	Export concentration by product	63
1.3.08	Direct investment stocks inward (% of GDP)	6	1.3.03	Direct investment stocks abroad ($bn)	63
1.1.09	Gross fixed capital formation (%)	6	1.2.08	Exports of good ($bn)	61
1.1.15	Real GDP growth per capita	7	1.1.19	Resilience of the economy	60
1.5.06	Gasoline prices	9	1.3.07	Direct investment stocks inward ($bn)	59
1.2.09	Exports of goods (%)	14	1.3.04	Direct investment stocks abroad (% of GDP)	59
1.2.23	Trade to GDP ratio	19	1.5.01	Consumer price inflation	59

Government Efficiency		Rank	Government Efficiency		Rank
2.2.09	Consumption tax rate	12	2.2.07	Effective personal income tax rate	63
2.5.14	Disposable Income	14	2.4.09	State ownership of enterprises	62
2.2.11	Employer’s social security contribution rate	16	2.4.10	Competition legislation	62
2.4.07	Government subsidies	16	2.3.04	Country credit ranking	61
2.4.19	Redundancy costs	20	2.3.05	Central bank policy	61
2.5.06	Gini coefficient	24	2.5.04	Risk of political instability	61
2.2.01	Collected total tax revenues	24	2.4.02	Protectionism	61
2.2.10	Employee’s social security contribution rate	33	2.3.11	Transparency	61
2.4.01	Tariff barriers	41	2.4.08	Subsidies	60
			2.3.08	Exchange rate stability	60

Business Efficiency		Rank	Business Efficiency		Эрэмбэ
3.2.04	Remuneration of management	1	3.2.19	Finance skills	63
3.2.01	Compensation levels	4	3.3.19	Corporate debit	63
3.2.06	Working hours	20	3.1.08	Large corporations	62
3.2.10	Employee training	24	3.2.18	Skilled labor	62
3.2.20	Attracting and retaining talents	31	3.4.02	Changing market conditions	62
3.2.16	Female labor force	33	3.2.24	Competent senior managers	62
3.5.05	Need for economic and social reforms	34	3.1.09	Small and medium-size enterprises	62
			3.4.03	Opportunities and threats	61
			3.3.14	Shareholders’ rights	61
			3.3.07	Regulatory compliance (banking laws)	61

Infrastructure		Rank	Infrastructure		Эрэмбэ
4.2.01	Investment in Telecommunications	3	4.2.18	Cyber security	63
4.1.21	Electricity costs for industrial clients	6	4.2.11	Qualified engineers	63
4.1.07	Population – growth	8	4.3.19	Medium and high-tech value added	63
4.2.16	High – tech exports (%)	15	4.4.26	Pollution problems	63
4.2.08	Broadband subscribers	26	4.5.15	University education	63
4.5.07	Secondary school enrollment (%)	30	4.3.22	Knowledge transfer	63
4.2.03	Mobile Telephone costs	32	4.2.07	Internet users	62
			4.3.11	Science degrees	62
			4.1.04	Access to water	62
			4.1.14	Quality of air transportation	62