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Wednesday, October 31, 2012

US out of 10 most prosperous nations' list

Norway, Denmark, Sweden ranked best for wealth and well-being in Legatum survey; Singapore third in economy sub-index

31 Oct 2012 09:52

 The US fell to 12th position from 10th in the Legatum Institute's annual prosperity index amid increased doubts about the health of its economy and ability of politicians -PHOTO: AFP

[NEW YORK] The United States slid from the world's top 10 prosperous nations' list for the first time in a league table which ranked three Scandinavian nations the best for wealth and well-being.

The US fell to 12th position from 10th in the Legatum Institute's annual prosperity index amid increased doubts about the health of its economy and ability of politicians. Norway, Denmark and Sweden were declared the most prosperous in the index, published in London yesterday.

With the presidential election just a week away, the research group said the standing of the US economy has deteriorated to beneath that of 19 rivals.

"As the US struggles to reclaim the building blocks of the American Dream, now is a good time to consider who is best placed to lead the country back to prosperity and compete with the more agile countries," Jeffrey Gedmin, the Legatum Institute's president and chief executive officer, said in a statement.

The six-year-old Legatum Prosperity Index is a study of wealth and well-being in 142 countries, based on eight categories such as economic strength, education and governance. Covering 96 per cent of the world's population, it is an attempt to broaden measurement of a nation's economic health beyond indicators such as gross domestic product.

The Legatum Institute is the public policy research arm of the Legatum Group, a Dubai-based private investment group founded in 2006 by New Zealand billionaire Christopher Chandler.

The report shows that even amid the worst financial crisis since the Great Depression, global prosperity has increased across all regions in the past four years, although the sense of safety a nd security is decreasing amid tension in the Middle East and fear of crime in Latin America.

Norway and Denmark retained the pole positions they held last year in the overall prosperity measure, while Sweden leapfrogged Australia and New Zealand into third. Canada, Finland, the Netherlands, Switzerland and Ireland rounded out the top 10. The Central African Republic was ranked bottom.

In its sub-indexes, Legatum named Switzerland the strongest economy and home to the best system of governance. Denmark is the most entrepreneurial and New Zealand has the best education, while health is best in Luxembourg and Iceland is the safest. Canadians enjoy the most personal freedom and Norwegians have the greatest social capital.

With President Barack Obama and Republican challenger Mitt Romney tussling for the White House, Legatum said the US economy declined two places from last year to 20th. It found that 89 per cent of Americans believe hard work produces results, up from 88 per cent last year, and the government's approval rate dropped to 39 per cent from 42 per cent.

Plagued by the euro-area debt crisis, 24 out of 33 European nations have witnessed a decline in their economic score since 2009, according to Legatum. On the prosperity scale, Greece recorded the biggest drop in 2012, falling 10 places since 2009 to 49th. Spain held on to 23rd place.

The UK remained 13th, one place ahead of Germany, and Legatum predicted it will overtake the US by 2014 as it scores well for entrepreneurship and governance. Nevertheless, the status of its economy remains a weakness as it slid five places to 26th on that score and job satisfaction is low.

In Asia, Hong Kong, Singapore and Taiwan all ranked in the top 10 for their economies and the top 20 overall. So-called tiger cub economies Vietnam and Indonesia also rose. Indonesia experienced the largest gain in prosperity of any country since 2009, jumping 26 positions to 63rd.

Switzerland, Norway and Singapore topped the economy sub-index, which measures satisfaction with the economy and expectations for it, the efficiency of the financial sector and foundations for growth. In a gauge of entrepreneurship, Denmark ran ahead of Sweden and Finland for the strength of innovation and access to opportunity.

Switzerland also topped the rankings for best government. The highest marks for education went to New Zealand, Australia and Canada.

Luxembourg, the US and Switzerland were graded the best for health treatments and infrastructure as well as preventative care and satisfaction with the service. Iceland, Norway and Finland topped the chart for safety and security; Chad, Congo and Afghanistan ranked the lowest on that index. - Bloomberg

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