The US has been unexpectedly knocked off the top of an influential league table ranking the world’s most competitive nations, while Britain is precariously close to losing its place in the top 10.


America has plunged from first to sixth place in the World Economic Forum’s Global Competitiveness Index, it emerged yesterday. The news will be seen as the latest sign that the lustre is coming off the American economic miracle, which has seen the US power global growth over the past. decade.
With more evidence emerging every week of a possible house price crash in the US, the news will compound the economic concerns of President George W Bush ahead of Congressional elections in November.
The report’s authors also wamed Gordon Brown that, having dropped from ninth to tenth place, the UK could slip out of the top 10 altogether unless he improves the state of the national accounts.
Experts said America’s ballooning budget and trade deficits, together with falling standards of health and education, had been responsible for the
dramatic fall in US competitiveness.
The fall also reflects the administration’s poor response to the Hurricane Katrina disaster last year. The report said: “While strengths in the technological and market efficiency sectors explain the country’s overall -high rank, the US economy sUffers from striking weaknesses. There is significant risk to both the country’s overall competitiveness and, given the relative size of the US, the future of the global economy.”
But neither will the report make comfortable reading for the Chancellor, who has come under repeated fire for running up large budget deficits at a-time when many economists had urged him to cut back on his borrowing.
Augusto Lopez-Claros, chief economist at the World Economic Forum, said:
“Consolidation of [the UK's] position among the top 10 will be ensured by further progress in fiscal consolidation, at a time when countries everywhere are beginning to realise the benefits of prudent fiscal policies which release resources for investment in infrastructure and
education. ”
The table was dominated by Scandanavian countries, whose stable budgets and good standards of education and healthcare help their overall competitiveness.
It was topped by Switzerland, which was boosted by its sound institutional environment, excellent infrastructure, efficient markets and high levels of innovation.

Global Competitiveness Index 2006 [last years position[

1. Switzerland [4]           6. United States [1]

2. Finland [2]                 7. Japan [10]

3. Sweden [7]                8. Germany [6]

4. Denmark [3                9. Netherlands [11]

5. Singapore [5]            10. United Kingdom [9]

Source: Daily Telegraph / World Economic Forum