Korea’s WEF competitiveness hits 10-year low

Korea’s national competitiveness reached its lowest level in 10 years, the Ministry of Strategy and Finance said yesterday, citing an annual report by the World Economic Forum (WEF).

Korea came in 26th among 144 countries worldwide in terms of national competitiveness. Its ranking went down one place compared to last year.

Asia’s fourth-largest economy rose to 11th place in 2007, but it has fallen each year since. In 2009, it ranked 19th and in 2004 it came in at 29th.

The WEF report showed Korea’s macroeconomic conditions improved, giving it a rank of 7th in that category. Its competitiveness in terms of market size, infrastructure and business innovation also received high grades.

More specifically, the report showed Korea is competitive in terms of its inflation, HIV prevalence, the number of landline phones, the size of its overseas, the number of patents and quality of infrastructure.

However, the country came in 86th in terms of efficiency of its labor market, and 80th for its financial market maturity.

Legal system efficiency, which is key to deregulation, scored very low, plunging 12 notches to 113th place. The ethics level of Korean businesses also fell from 79th to 95th place.

Access to loans, transparency in policy-making, financial soundness of banks, business costs of terrorism, property protection and costs of crime and violence were also weak points.

“The massive personal data leak incident, North Korea’s missile threats and the Sewol ferry accident have affected the evaluation in a negative way,” said an official at the Finance Ministry.

The Switzerland-based WEF has been evaluating countries’ competitiveness annually since 1979.

Switzerland topped the list, followed by Singapore, unchanged from last year. The United States, Finland, Germany and Japan came in after them.

The WEF evaluation result is based 30 percent on the statistics analysis and 70 percent on the survey.

BY SONG SU-HYUN [ssh@joongang.co.kr]