Korea’s Competitiveness “Seesawing”

Korea’s national competitiveness climbed 12 spots to the world’s 17th rank in the past year.

This ranking is the highest in history and the biggest jump ever among the 117 countries surveyed.

The Global Competitiveness Report 2005-2006 released by World Economic Forum (WEF) in Switzerland placed Korea at 17th, up from 29th last year.

The Global Competitiveness Report has been released annually by the WEF since 1979 and analyzes 40 quantitative indicators such as GDP and 120 survey items from corporate executives.

By component indices, the macroeconomic environment index including the economic outlook jumped 10 notches to 25th this year from 35th last year. Technology index representative of R&D investment, technology innovation, and Internet penetration also rose from ninth to seventh.

Finland topped the list for the third consecutive year, followed by the U.S., Sweden, and Denmark.

This year’s survey used different criteria for selecting survey subjects as Seoul School of Integrated Science and Technology (aSSIST) took charge instead of Korea Development Institute (KDI), WEF’s Korean partner until last year.

The KDI used to randomly sample 500 companies with more than seven billion won in assets, send questionnaires, and collect 100 to 150 back to send them to the WEF.

aSSIST, however, designated 300 “core companies” in addition to the 500 companies with assets over seven billion won before collecting over 280 survey papers to transfer them to the WEF. A staff with the school explained, “We chose competent companies with strong entrepreneurship.”

Korea’s competitiveness index last year had plummeted 11 levels from the previous year, which was met with strong resistance by Lee Hun-jai, former deputy prime minister and minister of finance, saying, “This cannot be done by a credible organization.”

Ki-Jeong Ko Chang-Won Kim koh@donga.com changkim@donga.com