World Economy

Waning Openness a Threat to Sustainable Growth, Innovation

Many countries are less open to free trade in goods and services
Luxembourg has a tiny population compared to the rest of Europe and a high income per capita, meaning easy access  to a healthy diet and the best healthcare.Luxembourg has a tiny population compared to the rest of Europe and a high income per capita, meaning easy access  to a healthy diet and the best healthcare.

A decade of protectionist economic policies has reduced the ability of most countries across the world to achieve healthy growth and innovation, the World Economic Forum says in its 2016 Global Competitiveness Report.

Less open societies tend to fall behind economically, the WEF said in a new report, underscoring that a global trend toward protectionist economic policies risked undermining nations' ability to grow and innovate, DW reported.

"Declining openness in the global economy is harming competitiveness and making it harder for leaders to drive sustainable, inclusive growth," said Klaus Schwab, WEF founder and executive chairman, as he released the organization's Global Competitiveness Report on Wednesday.

The Geneva-based forum's report is an annual survey of factors driving productivity and prosperity in 138 countries.

In the current report, WEF said there had been a trend emerging over the past ten years showing that many countries are less open to free trade in goods and services. This trend was marked by a global rise in non-tariff barriers, burdensome customs procedures and tougher rules governing foreign direct investment and foreign ownership.

The report also looks at monetary policy measures such as bond-buying programs and ultra-low interest rates adopted by central banks over the past decade, saying they were less effective in fuelling growth in countries with state interventionist policies.

Global Competitiveness Index

The report is based on WEF's Executive Opinion Survey, a poll conducted among more than 10,000 business leaders from all over the world who give their opinions on a range of socio-economic issues such as institutions, infrastructure, labor market, education, just to name a few.

Their views of countries also form the database for WEF's Global Competitiveness Index, which ranks the most competitive economies in the world.

Emerging Economies Converging

Regarding the world's largest emerging economies, also known as BRICS, the WEF report states "a sign of convergence in the competitiveness." While China leads the group, ranking in 28th place, India made big strides again, surging 16 places to 39. With both Russia and South Africa moving up two places to 43 and 47 respectively, only Brazil was declining, falling six places to 81.

Other emerging market economies, notably in the East Asia and Pacific region, saw reversals in the GCI scores this year, ending improvements reached over the past few years. Malaysia has dropped out of the top 20, Thailand falls two places to 34, while the Philippines drops even ten places to 57.

Life Expectancy

The WEF report does not just look at the financial health of countries around the world–it also looks at the health of populations.

The WEF ranked countries in terms of the average life expectancy, showing where in the world people live the longest.

Sweden — 82 years. Swedes live two years longer than the average age in all OECD countries.

Iceland — 82.1 years. Iceland has "The World’s Best Diet" according to a vote by nutritionists. It is said to reduce the risk of diabetes and heart disease.

South Korea — 82.2 years. Life expectancy in the country has risen over the last few years.

Luxembourg — 82.2 years. The country has easy access to a healthy diet and the best healthcare.

Australia — 82.3 years. An increase in healthier lifestyles and improved healthcare in the country has boosted the nation's life expectancy.

France — 82.4 years. France has one of the lowest obesity rates among OECD countries which contributes towards the nation's high life expectancy.

Singapore — 82.6 years. Life expectancy in the country has increased over the last 30 years.

Italy — 82.7 years.  Italians tend to live the longest because there is less of a poverty gap in the country.

Switzerland — 82.8 years. The nation's wealth makes healthcare and a good diet more readily available.

Spain — 83.1 years. Spain is famous for its "Mediterranean Diet" which doctors say can contribute to a long and healthy life.

Japan — 83.6 years. Life expectancy is long in Japan due to the a predominantly healthy diet.

Hong Kong — 84 years. The non-combative martial art Tai Chi significantly helps people to remain active and healthy into old age.