Nepal 3rd most competitive economy in South Asia

Nepal’s score

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Nepal 4th most competitive economy in South Asia

KATHMANDU, Oct 1: Nepal has improved its score in Global Competitiveness Index (GCI), becoming third most lucrative investment destination in South Asia, according to a report.

According to the Global Competitiveness Report 2015-2016 published globally on Wednesday, Nepal ranked 100 -- with a score of 3.9 -- among 140 economies in the world. With improved score, Nepal is the third most competitive country for investment in South Asia. The more the score -- measured from 1 to 7 -- the more competitive is the economy.

With score of 3.8, Nepal was ranked 102 in the Global Competitiveness Report 2014-2015, among 144 economies in the world, the report said, adding that the macroeconomic environment, and health and education -- two of the 12 pillars that gauge the competitiveness of the economy -- have improved. "Nepal ranks among the factor-driven countries," said country coordinator for the report Ramesh Chandra Chitrakar.

India (55) is the most competitive economy followed by Sri Lanka (68) and Nepal (100) in South Asia. Bhutan ranks 105, Bangladesh is in 107th position and Pakistan ranks 126 in the index.

The set of institutions, policies, and factors determine the level of productivity of a country. The level of productivity, in turn, sets the level of prosperity that can be earned by an economy, Chitrakar added.

The ranking -- based on the assessment of 140 economies on parameters such as infrastructure and institutions, macroeconomic environment, health and education, among others -- claimed that quality of Nepal's institutions has also improved apart from macro-economic environment, health and education.

However, Nepal needs to improve its technological readiness and efficiency enhancers to graduate to the efficiency-driven economy from current-factor driven economy, he said, adding that the report encourages the government to fix policy, institutions, and factors to make the economy more competitive or productive that can propel economic growth.

Switzerland, Singapore and the US are the top three ranked economies, unchanged from the previous year, according to the report. Likewise, three Asian countries -- Singapore, Japan and Hong Kong -- are in the top ten positions. In Asia, Malaysia ranked 18th, up two places, Indonesia ranked 37th, down three notches, while Thailand ranked 32nd, down one position.

The report also stated that emerging and developing Asia is the world's fastest-growing region since 2005 but it will retain for medium term. "The region accounts for some 30 percent of global GDP, with China alone accounting for 16 percent," it reported, adding that ASEAN is performing well, but no countries in SAARC is above the rank of 50.