During his conference speech earlier this month David Cameron focused his remarks around the idea that we are now in a global race. This, the Prime Minister said, means we face “an hour of reckoning” where our choices are to “sink or swim. Do or decline.”
The global race is very much on and, what’s more, the number of competitors is increasing. Advances in mobile technology across sub-Saharan Africa and other developing countries mean that doing business around the world has never been easier.
If we really are in a global race, how are we doing? Are we falling behind our fellow competitors or surging ahead? Last week’s GDP growth figures may not have proven that we are up to full speed but they do suggest that something is working.
The growth figures are positive, but they don’t tell the whole story. The Legatum Prosperity Index™ is an assessment of what makes a country truly successful, encompassing traditional measures of material wealth as well as capturing citizens’ sense of wellbeing. Covering 96% of the world’s population and 99% of global GDP, the Index provides a more complete picture of global prosperity than any other tool of its kind.
The 2012 Index – released today – reveals that prosperity is on the rise in the UK. Overall, the UK has climbed one place in the rankings since last year and places 13th in 2012.[1] The UK also performs well in the Governance and Safety & Security sub-categories (ranking seventh and 20th, respectively).
So how does the UK stack up against the rest of the world? The UK outperforms America in a number of key areas including Entrepreneurship & Opportunity where the UK places sixth (compared to 12th for the US) and Governance where the UK ranks seventh (compared to 10th for the US). What’s more, with the US dropping to 12th position in the overall rankings, the UK is only one place behind and could even overtake the US by 2014 if current trends continue.
Within Europe, the UK is ahead of both Germany and France in overall levels of prosperity. However, Germany outperforms the UK on the Economy sub-category (6th compared to 26th, globally). Perhaps unsurprisingly, Scandinavian countries perform very well in the Index with Norway, Denmark, and Sweden ranking first, second, and third, respectively.
Although the UK performs well on measures of governance (7th globally), there has been a decline in levels of government approval over the last year. This has fallen to 50% (from 57% in 2011). However, this is still not as low as it was in 2009 when government approval stood at less than 40%.
China ranks 55th overall, due in part to poor scores in the Personal Freedom and Safety & Security sub-categories. China does, however, outperform the UK in the Economy sub-index, ranking 11th overall compared to the UK’s 26th.
Many countries in the Index rank similarly on GDP levels, but other factors such as Education, Health and Personal Freedom can highlight significant variation, demonstrating that national success is based on much more than material wealth.
The idea that GDP is an incomplete measure of national success has been argued by political leaders as different as Nicolas Sarkozy, Robert F Kennedy, the King of Bhutan and, of course, David Cameron himself.
David Cameron is right to say we are in a global race. We are at a time of flux, with many of the world’s nations in transition and looking for new ways to address social, political and economic issues. Today’s findings from the 2012 Prosperity Index combined with the recent GDP growth figures suggest that the UK is starting to pick up speed.
[1] Due to new countries being added to the Index, it may appear that the UK has not improved its ranking since last year (also 13th). However, if we consider only the 110 countries from last year’s Index, the UK would rank 12th this year – an improvement of one place.
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