Australia Falls Behind New Zealand In Global Competitiveness Ranking

Australia has fallen behind New Zealand in terms of global competitiveness. The business sector has criticised Prime Minister Tony Abbott’s government for failing to stimulate a fresh wave of infrastructure spending.

Australia’s competitiveness level has slumped to its worst in the last 18 years. In a report commissioned for the IMD World Competitiveness Yearbook, the country’s ranking dropped to 18 from 17 in 2014. The slump continues a downward trend that began in 2009 when Australia was ranked fifth in global competitiveness, reports Herald Sun.

New Zealand has outperformed Australia for the first time in 18 years as the island nation moved from 17 to 20, according to the IMD report. The Committee for Economic Development of Australia polled businesses to determine their greatest concerns. Australian businesses have become concerned of the decline in investment in skills, technology and the lack of transport and other infrastructure.

The Australian Financial Review said the findings of the report were a major blow for the Abbott government. Mr Abbott had previously promised during the election campaign that he would become the “infrastructure prime minister.” The findings highlight the business sector’s disappointment at the lack of progress on new projects.

The government has been using the May budget to borrow more to pay for a short-term boost through the $20,000 instant asset writeoff for small businesses. However, there were concerns that the government is lacking in longer-term economic investment to replace the mining boom.

CEDA chief executive Stephen Martin said “something has to happen” since interest rates and budget deficits are not at the same levels. He added that the government has failed to live up to its promise of infrastructure. He added that respondents in the survey does not seem to be an “infrastructure prime minister.”

The findings of the global competitiveness report came after Infrastructure Australia warned of the rising costs of economy congestion. The government’s main infrastructure advisory body said costs would quadruple to $53 billion by 2031.

According to the IMD report, Australia’s ranking has worsened to 19^th this year from 14^th in 2011. The country’s economic performance has also dropped further in the rankings to 28^th place from 24^th in 2014. The report said the government’s efficiency has fallen five places to 14 because of the growing debt and worsening budget deficit.

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