Introduction
Last week I offered the view that for the foreseeable future, the GDP will continue as the premier measure worldwide, and in Guyana, of economic size and progress, as well as national and individual welfare/well-being. Several alternatives to the GDP have recently gained prominence. These, however, should be treated as complementary/supplementary. Two are of special relevance to Guyana, namely, the Human Development Index (HDI) and the Global Competitiveness Index (GCI). Both these indexes are produced annually for Guyana. And, since on several previous occasions, I have discussed the HDI, I will not repeat here; my focus will be on the GCI.
What is national competitiveness?
There is considerable controversy over the notion of national competitiveness, considered distinct from firm, sectoral or regional competitiveness. The World Economic Forum (WEF) defines national competitiveness as depending on institutions, policies, and factors determining a nation’s productivity level. In turn, its productivity level governs the rate of return on national investments and, therefore, its potential to grow and prosper. From this definition, the WEF has developed a framework for benchmarking the static and dynamic microeconomic and macroeconomic components of national competitiveness.
These components are then grouped into 12 pillars, namely, institutions; infrastructure; macroeconomic environment;