Ukraine drops eight places in World Economic Forum annual rating of competitive countries
ual rating of competitive countries, to 77th place out of 80 countries surveyed.
The only countries ranked below Ukraine in the WEF’s 2002 Global Competitiveness Report were Bolivia, Zimbabwe and Haiti. Ukraine placed 69th out of 80 countries in 2001.
The WEF uses a “Growth Competitiveness Index” and a “Microeconomic Competitiveness Index” to measure the relative strengths and weaknesses of growth within a country’s economy. The former index examines the underlying prospects of economic growth of the countries it surveys over the next five years; the latter index takes into account the current business climate only.
“The key question our report tries to answer is: Once the global economy recovers, which countries are best placed to return to a sustained growth path?” said Peter Cornelius, director of the WEF’s global competitiveness program.
Hlib Vyshlinsky, an analyst at the International Center for Policy Studies, said the WEF’s data paints a distorted picture of the nation. He said that ICPS had conducted similar surveys in the past, and that the indicators they received were much better.
“As for Ukraine, it seems that government reluctance to increase accountability and transparency is a bigger obstacle than economic competitiveness,” Vyshlinsky said.
Other analysts say that the poor rankings fail to reflect that the country’s economy has been growing rapidly in the last few years.
European Bank for Reconstruction and Development spokesman Anton Usov said that in the past two years the country has had one of the most rapidly growing economies out of the 27 other countries surveyed by EBRD.
“Although growth has slowed in the past year, the slowdown was not unexpected as the external market has been weaker,” an EBRD report said.
Domestic demand has remained robust, boosted by strong consumer spending and higher levels of investment, the EBRD report said.
EBRD analysts cite a number of threats to Ukraine’s economy in the near future. They say the country faces the same concerns over fuel prices as other oil and gas importing countries in the CIS. Another obstacle for the country is a bill passed by parliament on Jan. 17 that extends three‑year‑old tax privileges for Ukraine’s mining and metallurgical companies.
Metallurgy companies recently got one more perk in the form of a 30 percent export duty on scrap metal. Mykhailo Brodsky, a former deputy and leader of the Yabluko political party, said the duty would kill competition in the metallurgical industry, which accounts for 40 percent of the nation’s exports. The privileges represent an artificial measure that run counter to the principles of a market economy, Brodsky said.
