TALLINN - Although Estonia slipped four positions in the international competitiveness rating compiled by a Swiss economic institute, local experts said they considered the country's 28th place positive news.
It was the fourth time Estonia participated in the rating organized by the Swiss-based International Management Institute for Executive Development and Education, also known as IMD. However, in 2001 and 2003 the Baltic country came in 22nd and in 2002, 21st.
Leev Kuum, the leading researcher of the Estonian Institute of Economic Research, said given that the rating embraced the world's 60 most developed economies, Estonia's 28th position was positive, especially taking into account the relative age of the country's market economy. He gave two reasons for the high rating.
"First, it is the dynamism of the economic development, and second – the efficiency of the economy," said Kuum.
He also stressed that in relation to the rating leader, Estonia's competitiveness has improved since 2001, from 62 percent to 68 percent.
The IMD Competitiveness Yearbook is composed using 323 criteria of economic performance, government and business efficiency and infrastructure. Apart from statistical data, businessmen of every country contribute by filling out a rating questionnaire. Also, in larger countries regions can be rated as independent economies.
Since 2000 the rating has been led by the United States. In 2004 it was followed by Singapore, Canada, Australia, Iceland, Hong Kong and Denmark. Estonia's northern neighbor and leading investor, Finland, ranked eighth.
Latvia and Lithuania, however, do not participate in the IMD competitiveness rating.
Andrus Viirg, head of the Enterprise Estonia governmental business promotion agency, said that in 2003 the amount of foreign direct investment reached a record 756 million euros, of which nearly 400 million were reinvested profits.
Viirg said that by reinvesting funds, foreign companies not only take advantage of the corporate tax exemption but also show that they trust the local economy - one of the most important criteria for a competitive economy.