The top of world’s Bloomberg Innovation Index for 2019 mark a good surprise for Israel. The Jewish state jumped five places in the ranking compared to last year and surpassed Singapore and the United States.
South Korea maintained its first place in the index, although Germany’s improvement in research and education nearly raised Europe’s largest economy to a position of equality with it. The United States advanced to eighth place, a year after education problems drove it out of the top 10 economies for the first time in history, and Sweden, which competes for the title from 2017, dropped to seventh place.
The index analyzes dozens of criteria using seven indices, including research and development, production and concentration capacity of public high-tech companies. The ranking of the year comes as world economic elites gather at the World Economic Forum in Davos, Switzerland, where they will discuss the future of globalization, the role of the state and how innovation can move countries forward.
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Germany, as noted, almost equaled South Korea, which has been at the top of the rankings for six consecutive years, thanks to the added value of its production and research power, most of which are built around industrial giants such as Volkswagen, Bush and Daimler. Although South Korea remains in first place, its lead is narrow due to relatively low patent activity. Patent activity raised the score for China and Israel, which emerged as a real winner this year after jumping five places and reaching fifth place. It overtook Singapore, Sweden and Japan.
South Korea’s first-place ranking could be boosted by increased investment in strategic technologies and a regulatory program that encourages start-up companies, says Kon Go, head of research at Australia and New Zealand Banking Group in Singapore. For him, the challenge lies in the spread of innovation beyond the large, family-run corporations.
Germany’s rise in Bloomberg’s rating seems temporary, while Europe’s biggest exporter is struggling with a shortage of skilled workers and a shifting immigration policy. Britain fell to 18th place and below China for the first time. China’s record reflects a dichotomy in the world’s second-largest economy: it came in second place in patent activity for companies such as WAVE and BOE Technology Group, but still lagging behind in overall productivity.
The United States rose three places to eighth place, faster product cycles and increased competition are changing the way managers should work: “Moderate and marginal innovation is no longer rewarded. Managers should make sure that bureaucracy does not stand in the way of innovation, “said Albert Burla, CEO of Pfizer Pharmaceuticals, at a recent conference.
The joiners and losers
Among the economies ranked for 2019, the biggest losers were Tunisia and Ukraine, both falling out of the top 50. Ten economies joined this year thanks to reliable information. The UAE made the most impressive debut and reached 46th place.
Brazil joined the index in 45th place after not being ranked last year. They also joined Mexico, India, Vietnam and Saudi Arabia this year. South Africa remains the only country in the southern Sahara region that is ranked in the index.
The rating, published for the seventh year, began with 200 economies. Each was ranked on a scale of 0-100 based on seven categories. Countries for which information was not available in at least six categories were not ranked, bringing down the total number of countries ranked 95. The Bloomberg Index contains the first 60.
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