Jakarta. Indonesia has advanced to the 27th position in the 2024 IMD World Competitiveness Ranking (WCR), a significant improvement from 34th place in 2023. This places Indonesia third in Southeast Asia, following Singapore and Thailand, with Singapore maintaining its global lead.

"Over the past few decades, countries like China, India, Brazil, Indonesia, and Turkey have experienced rapid growth and development. This has led them to play a significant role in trade, investment, innovation, and geopolitics," explains Arturo Bris, Director of the IMD World Competitive Center (WCC), which has been publishing the WCR since 1989.

In this year's rankings, Indonesia has surpassed Malaysia, which dropped to 34th place from 27th in 2023 due to currency depreciation and political uncertainties. Indonesia's rise underscores its enhanced economic performance and stability.

Bris highlights Southeast Asia's robust economic performance this year, except for Malaysia's decline. Indonesia's competitiveness surge is attributed to improved economic indicators, capital attraction, and GDP growth.

Indonesia's ranking closely approaches that of the UK (28), outperforming Japan (38) and India (39). Japan's slip in competitiveness is linked to its slower adoption of digital transformation, impacting technology exports. India, while showing improvement, lags behind Indonesia due to various economic and efficiency factors.

The IMD World Competitiveness Center (WCC) uses four indicators to determine the rankings for its annual WCR: economic performance, government efficiency, business efficiency, and infrastructure. Indonesia's competitiveness ranking is boosted by its high scores in business efficiency (14), government efficiency (23), and economic performance (24). However, the country still lags in terms of infrastructure availability, particularly concerning health and environmental infrastructure (61), education (57), science (45), and technology (32).

Regarding business efficiency, Indonesia has been successful in increasing its score due to the abundance of available labor (2), effective company management (10), and societal behavior and values that support business efficiency (12). However, there is still room for improvement in financial (25) and company productivity (30).

In terms of government efficiency, Indonesia's lowest scores are related to business legislation (42), which affects the competitiveness of the private sector, such as trade, competition, and labor regulations. Its second-lowest score is in the social framework, which measures law enforcement fairness, income, and gender equality. However, Indonesia has achieved good rankings in tax policies (12) and public financial policies (18), which are related to the efficiency of the state and central bank.

The WCR evaluates 67 countries' long-term well-being beyond GDP, considering social, cultural, and sustainability aspects through global surveys and statistical analysis. 

Here are Southeast Asia's top five competitive countries:

1. Singapore (1)
2. Thailand (25)
3. Indonesia (27)
4. Malaysia (34) 
5. The Philippines (52).