World Economic Forum: Chad Listed as Least Competitive Nation

The World Economic Forum just issued the current Global Competitiveness Report (2013-2014). The study is one of the most dense and complex assessments of national economies. It also pretends to rate nations on which very little data is available. That may be why Chad ends up at the bottom of the list of 148 countries, along with several other nations for which no solid data has been available recently, and in some cases has not been for years.

The Global Competitiveness Report continues to use its “12 Pillars of Competitiveness” for rating all nations. The authors write:

We define competitiveness as the set of institutions, policies, and factors that determine the level of productivity of a country. The level of productivity, in turn, sets the level of prosperity that can be reached by an economy. The productivity level also determines the rates of return obtained by investments in an economy, which in turn are the fundamental drivers of its growth rates. In other words, a more competitive economy is one that is likely to grow faster over time.

The names and the descriptions of the Pillars are so hard to understand that a reading of the methodology of the Global Competitiveness Report will exhaust most readers before they can get to the important parts of the report. They are, in order: Institutions, Infrastructure, Macroeconomic Environment, Health and Primary Education, Higher Education and Training, Goods Market Efficiency, Labor Market Efficiency, Financial Market Development, Technical Readiness, Market Size, Business Sophistication, and Innovation.

Countries with homogenous populations and governments that directly support both business and the economic welfare do well in the Global Competitiveness Report, as they do in much of the research from other agencies like the International Monetary Fund and World Bank. Switzerland tops the list, followed by Singapore. All of the Scandinavian nations, which are rich and benevolent, are very near the top — Finland, Netherlands, Norway, Denmark and Sweden. The countries that have been at the top of the of the economic and financial leadership in the developed world are all there too — Germany, the United States, Japan and the United Kingdom. Each of the nations at or near the top of the list has a sophisticated ability to gather huge sums of data on its economic activity and details about its population. In other words, these countries are easy to rate because they have tools and budgets to collect the necessary data for evaluation in this study.

Granted, it is not surprising that Chad is at the bottom of the list, or at least near the bottom. However, there is so little solid data on this country, its finances and economy, that Chad, along with several other small, underdeveloped countries, should be exempt from this report since the reader is assured that the results are based on extensive research and analysis. Accurate and extensive information on some of the countries that are just ahead of Chad in this report’s list — Macedonia, Georgia, Ecuador and Vietnam — is also unavailable.

The Central Intelligence Agency is as good as any other organization at collecting facts on other countries. The CIA has an army of people who perform the work that allows them to issue The CIA World Factbook. The spying division of the American government reports:

The World Factbook provides information on the history, people, government, economy, geography, communications, transportation, military, and transnational issues for 267 world entities.

As far as Chad is concerned, the CIA can only estimate gross domestic product (GDP) for the past three years, and reports that it reached about $21 billion in 2012. The same is true of GDP growth rate and gross national savings. As a matter of fact, the CIA can only make a reasoned guess at which sectors make up the national economy. Just above 47% is agriculture, maybe.

The persistent idea that nations for which a great deal of current economic, financial and demographic information exists can be measured against those for which nearly no data is collected or available continues to be a waste of effort. Comparing the competitiveness ranking of Slovenia to Canada does not inform the audience of the Global Competitiveness Report in any meaningful way.