Global Themes

On Globalization & Venture Capital

India, China and Global Competitiveness

HBS Working Knowledge recently carried a story on the latest Business Competitiveness Index report titled, “U.S. Tops Business Competitiveness Index 2006”. The annual survey is carried out by Michael Porter’s Institute for Strategy and Competitiveness at HBS.

Not Surprising bits:
1. United States topped the list
2. India improved and China fell in their respective rankings (vs. last year)
3. China’s “decline was driven especially by higher levels of corruption, weaker assessment of buyer sophistication, and concerns about labor relations”
4. India’s move up was “aided by improvements in its business environment and increasing levels of company sophistication”

Surprising (to me) bits:
1. Germany was second on the list (impressive)…due to from its orientation on exports, the unique competitive positions of its companies, and the quality of its legal and regulatory framework.
2. The gap between India (at 27th) and China (at 64th)

I believe India scored on intensity of local competition, financial market sophistication, and intellectual property protection + sophistication of company operations (which the report says, can account for “80 percent of the variation in GDP per capita across countries“)

There is also a video interview with Porter here.

October 17th, 2006 Posted by | China, Emerging Markets, Global Competition, India | no comments

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