Democratic Switzerland is the world’s most competitive economy. China doesn’t make the top 10. (Photo: Wikimedia Commons)
The World Economic Forum has just released its latest Global Competitiveness Report, which assesses the competitiveness of 148 economies around the world. This year’s top ten includes few surprises, but does illustrate an important fact: eight of them are democracies and rated “Free” by Freedom House’s Freedom in the World index. (Singapore, which ranks second, and Hong Kong, which is under Chinese sovereignty and ranks seventh, are both rated “Partly Free.”)
Why is this important? At CIPE, we believe that democratic and economic development go hand in hand: strong democratic institutions support strong market institutions, and vice versa. But this belief is not shared everywhere. There is a growing contingent who feel that “strong” leaders in charge of highly directed economies can lead poor countries to prosperity, and that elections and debate simply get in the way.
The task of building a strong competitive advantage in the global market rests on the fundamentals of productivity growth. As Michael Porter has long argued, a country’s competitive advantage includes not only inherited factors of production (e.g., geography, demography, natural resources) but also created ones, such as infrastructure, knowledge resources, and communication networks.
In this Feature Service article, Jawad Rachami is a senior manager at an aerospace firm in the United States, argues that in the Middle East and North Africa (MENA), one sector that could uniquely spur the region’s global competitiveness is air transportation. Participation in 21st century global trade requires modern aviation infrastructure and the integration of local capacity into complex cross-border supply chains. Having such advanced infrastructure can transform an economy by energizing the private sector, creating broader access to trade and investment, and turning airports themselves into major economic engines.
Rachami says, “Global air transportation has achieved remarkable progress over the years in terms of new technology, market presence, and economic relevance. In MENA, however, aviation development remains a mixed bag ranging from impressive expansion and modernization in the Gulf to a series of stumbling blocks spanning from Casablanca to Damascus. A key question, then, would be: How can MENA move forward on achieving even growth for its aviation industry and moving towards a more sustainable economic model?”
Article at a Glance
- Middle East and North Africa (MENA) countries must diversify their economies in order to lay a stronger foundation for lasting growth.
- Modern aviation infrastructure is important for global competitiveness and for connecting local MENA economies to the rest of the world.
- The success of MENA countries in developing sound aviation infrastructure has not been uniform, nor has been their ability to create competitive positions in global markets.