The US and UK both make the ranking for the top 10 most competitive countries in the world. However, when it comes to nations with the greatest amount of gross general government debt as a percentage of GDP, they also make the near top spots.
Every year WEF releases its benchmark Global Competitiveness Report that takes a look 98 indicators across 140 countries to determine the overall ranking. Each indicator uses a scale from 0 to 100, to signify how close an economy is to the ideal state or “frontier” of competitiveness. Those indicators are then organised into 12 pillars, such as health, skills, financial system, infrastructure, and institutions.
In addition, WEF this year used a new methodology to fully capture the new emerging dynamics of what fuels the global economy, which means including some other indicators that were not included before, such as diversity, workers rights, re-skilling, and press freedom.
One area WEF looks at are the financial health and risks of countries around the world. One way to test this is by looking at a country’s ability is to pay back debts without incurring further debt — the lower the debt-to-GDP ratio, the better.
By looking at data from the International Monetary Fund, World Economic Outlook Database, and staff reports, WEF collated its list of countries’ gross general government debt as a percentage of GDP. In the end, it ranked 137 countries by lowest debt-to-GDP ratio.
Hong Kong came first with 0.1%, which is hardly surprising because it’s now a special administrative region of China. The tiny nation of Brunei in second with 3.1% and European country Estonia came in third with 9.5%.
However, if you go down to the bottom of the list, Japan comes up as the country with the highest level of government debt as percentage of GDP, with 239.2%. Greece came in second with 181.3% and Lebanon clocked 143.4%.
The US ranked 13th from the bottom of the list with 107.4% and the UK came in 21st from the bottom of the list 89.2%.