'Economic hangover' may cause nations to stumble

Associated Press

LAUSANNE, Switzerland — The United States and Singapore kept their top spots as the world's most competitive nations, but strong growth in Hong Kong has brought it back up the chart, according to an annual survey released last week.

"Formidable" economic growth of around 10 percent brought Hong Kong back to sixth place, which it held in 1999 before dropping to 12th last year, the survey said.

But the report sounds alarm bells for the year to come. "2000 was a year of 'economic exuberance.' 2001 may be one of 'economic hangover,"' it said.

Economic slowdown in the United States, coupled with Japan's continuing crisis, could hit the rest of the world.

"Together, the U.S. and Japan represent 46 percent of the world economy," said Professor Stephane Garelli, director of the project. "Their loss of momentum is likely to affect every nation around the world."

The top 10 in the survey is filled out by Finland, Luxembourg, The Netherlands, Ireland, Sweden, Canada and Switzerland.

Europe's economies are in good form and could be insulated against a downturn, the report said. The Nordic countries are doing especially well, it said, "particularly due to massive investments in new technological infrastructure."

Export-dependent Asian countries are more vulnerable to a global slowdown, the survey said. South Korea kept its rank of 28th in this year's survey. Taiwan was raised two places from last year, to 18th.

The survey said that success in the competitiveness table increasingly depends on a country's ability to attract highly educated workers.

"The winning nations not only create a favorable environment for the best investments but also for the best brains," said Garelli. "The U.S. is very aggressive in facilitating the immigration of talent — between 1994 and 1999, it 'imported' 124,000 Indians, 68,000 Chinese, 57,000 Filipinos, 49,000 Canadians and 42,000 British holders of higher education degrees."