US tumbles in ranking of world's economies

September 27, 2006|Associated Press

GENEVA -- US economic competitiveness fell significantly over the last year, as high budget and trade deficits hurt America's business environment, according to a survey by the World Economic Forum.

The disappointing response to Hurricane Katrina, government corruption, and a decreasing talent pool for employment due to immigration restrictions were other factors cited by the forum, which moved the United States to sixth in its ``global competitiveness index" from the top spot a year ago.

``There is significant risk to both the country's overall competitiveness and, given the relative size of the US, the future of the global economy," the report said.

Switzerland topped the poll, which was conducted for the 27th consecutive year, but only the second year using a new formula, the forum said.

Over 11,000 business leaders in 125 countries took part in the survey by the forum, whose aim is to examine the range of factors that can affect an economy's business environment and development as it seeks to maintain economic growth -- including the levels of judicial independence, protection of property rights, governmental favoritism in policy-making, and corruption.

Emerging economies such as China's and India's fared modestly. India came in at 43d, carried by its innovation and the sophistication of operations. China dropped six places from last year, to 54th