For the first time ever, Canada’s economy beat out the United States in a worldwide ranking.

Earlier this summer, The Institute for Management Development (IMD), an independent business school based in Switzerland and Singapore, released its annual World Competitiveness Ranking. Canada’s economic competitiveness on the world stage made it into the top 10 this year, jumping from 13th to 8th spot.

The United States fell from the number 3 spot, which it held in 2019, down to 10th. The US held the number 1 spot in 2018, before being unseated by Singapore last year.

According to IMD’s report, trade wars have damaged both the US and China’s economies “reversing their positive growth trajectories.” China this year dropped to 20th place from 14th in 2019.

IMD has released its ranking, which rates the performance of 63 economies around the world, annually for the past 32 years. This is the first time Canada has ever ranked higher than the US.

The report attributes Canada’s rise in the ranks to “improvements in measures related to its labour market and in the openness of its society.”

Canada’s economy ranked the highest of any country in North America.

This year’s top 10 rated economies:

  1. Singapore
  2. Denmark
  3. Switzerland
  4. the Netherlands
  5. Hong Kong SAR
  6. Sweden
  7. Norway
  8. Canada
  9. UAE
  10. United States

Check out the full list of all 63 countries here.

The report authors noted this year’s ranking saw a rise of many smaller economies.

“The benefit of small economies in the current crisis comes from their ability to fight a pandemic and from their economic competitiveness,” Arturo Bris, director of the IMD World Competitiveness Centre and Professor of Finance, said in a report on IMD’s website.

“In part these may be fed by the fact it is easy to find social consensus.”

Alexander Stubb, director of the School of Transnational Governance at European University Institute and a former prime minister of Finland, told a virtual roundtable discussion on the ranking that the success of smaller countries – particularly those in northern Europe, Canada, Australia and New Zealand – can be attributed to “their pretty much open welfare state.”

“They are very transparent in the way they deal with things, they are globally oriented and they are competitive in many ways,” he said, according to a Huffington Post report.

You can read more about IMD’s World Competitiveness Ranking here.

Published on August 21, 2020.