GLOBE-Net, April 10, 2013 – Canada has placed seventh in the 2013 ranking of 176 countries according to their capability to sustain or increase wealth in a resource-constraint, globalized world.
The Global Sustainable Competitiveness Index was first developed and published in 2012 by SolAbility, a Swiss-Korean Joint Venture consulting house founded in 2005 by a former senior Dow Jones analyst.
The Index is based on a competitiveness model that incorporates all aspects required to sustain wealth, the environment, and social cohesion. In addition to the full integration of sustainability performance data, it also analyses and incorporates the data trends over time to allow for a better expression of the future development potential. The results aim at serving as an alternative to the GDP, and to be used to analyse future development prospects of nations.
The four main pillars of the model are:
Natural capital (the availability of natural resources),
Resource efficiency (as a measurement of industrial competitiveness),
Sustainable innovation (as a measurement of the capability to sustain economic activities in a competitive global market) and
Social Cohesion (the foundations of smooth operation and secure investments).
Key findings of the 2013 Index include:
- Scandinavian nations have tightened their grip on the top four positions, followed by Central and Northern European Nations.
- Canada (7) is the only non-European country in the top 10
- Large economies kept their position within the rankings: Japan (12), UK (25), US (27). Brazil (28) is highest ranked amongst the BRICS countries
- Asian nations (Singapore, South Korea, Japan, and China) remain leading in terms of sustaining innovation capabilities
- Natural Capital and Resource Efficiency rankings are topped by countries with high availability of water resources, favourable climate conditions, and rich biodiversity.
- Clear distinctions are visible between countries within the same development stages. Large parts of the human population are living in countries with high natural capital depletion combined with low resource efficiency (China, India), raising concerns regarding the capabilities to achieve sustainable wealth.
- The Social Cohesion ranking is headed by Scandinavian and Northern European countries, indicating that a strong social fabric is a result of the combination of economic development and equality initiatives
Natural Capital – Because the natural capital is a given value – it is as it is – there are limitations to improve or change the available natural capital. While it takes little to impair or exploit the natural capital, rebuilding or improving natural capital factors is difficult,and requires significant time and resources. Large countries with a comparably small population density and rich biodiversity are on top of the Natural Capital ranking (North America, Scandinavia, Brazil). A large number of countries located in tropical areas (at the intersection of Central and South America, West Africa, South-East Asia)also seem to have the potential to achieve sustainable development based on their respective natural capital. Both of these observations underline the overarching importance of the availability of water for humanity.
The top ten according to natural capital indicators contains some surprising and not well known countries like Papua New Guinea, Suriname, Guyana, and Laos – whereas the OECD’s representation in the top twenty is limited to Canada, New Zealand, Denmark and Norway. The ranking of China (149) and India (126) are affected by a combination of arid climate, high population density, and depletion levels, raising some concerns to these countries ability to sustain their large populations.
Resource efficiency -Notes the report a number of factors are pointing to rising cost of resources in the future: scarcity and depletion of energy, water, and mineral resources, increasing consumption (particular in non-OECD countries), financial speculation on raw materials, and possibly geo-political influences. The key objective of the resource efficiency element is therefore to evaluate a countries’ ability to deal with rising cost and sustain economic growth in the face of rising prices in the global commodity markets as expected.
Vital resources include water, energy, and raw materials. Most of the resources used today are non-renewable, or only partly renewable: fossil-based energy, and minerals. Water aquifers and other natural products (e.g. wood) are renewable, as long as their capacity is not overused and the replacement patterns are not drastically altered, e.g. trough depletion, biodiversity loss, pollution, or climate change.
The resource intensity ranking is topped by less developed countries, with no OECD nation in the top 20. Canada ranks 129 on this scale, well behind less well developed countries. The main implication of these rankings are related to stability of economic growth: should global prices for raw materials and energy rise significantly in the future (as the majority of available research suggests), the countries in the lower ranks will face substantial higher challenges to maintain their growth compared to countries with higher efficiency and intensity scores.
Sustainable innovation – The indicators used for assessing innovation capability and sustainability competitiveness are composed of data points relating to education, innovation capabilities, business environment, economic development, and infrastructure. Countries with a high score in this ranking are more likely than others to develop successful economies through research and know-ledge driven industries, i.e. the high-value added industries, and therefore achieve higher growth rates.
The innovation and competitiveness ranking is dominated by Asian nations and OECD countries from the Northern hemisphere. The innovation and competitiveness ranking is topped by Asian countries (Singapore, South Korea, Japan, China), with all other top-ten places (Germany, Denmark, Norway, Switzerland, Finland, Sweden, in order of ranking) and top twenty spots going to European countries expect for Israel (12) and Canada (19).
Social Cohesion – Social Cohesion is not a tangible value and therefore hard to measure and evaluate in numeric values. In addition to historical and cultural influences, the social consensus in a society is influenced by several factors: health care systems and their universal availability /affordability to measure physical health; income and asset equality, which are correlated to crime levels; demographic structure to assess the future balance within a society; and freedom of expression,freedom from fear and the absence of violent conflicts.
The indicators used to calculate the social cohesion score of countries is composed of health and health care factors (availability and affordability), the quantitative equality within societies (income, assets, and gender equality), freedom indicators (political freedom, freedom from fear, individual happiness), crime levels, and demographic indicators.
The four Scandinavian countries occupy the top 4 spots of the Social Cohesion ranking, with other Central and Northern European countries (Iceland, Austria, Switzerland, the Netherlands,Ireland, and Germany,) filling the top ten. The first non-European countries in the Social Cohesion ranking are Canada (13), followed by new Zealand (32).
The Global Sustainable Competitiveness Index 2013 is available for download”
The Full Report (PDF, 84 pages)
Part 1 – Sustainable Competitiveness Index 2013
Part 2 – Sustainable Competitiveness Methodology Brief
Part 3 – Sustainable Competitiveness vs. Davos Man Competitiveness
Part 4 – Achieving Sustainable Competitiveness
Part 5 – Sustainable Competitiveness Rankings:
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