Credit Suisse has published another “Success of Small Countries Report.” In the report, they found that small developed states and separate customs territories were economically more successful that their larger peers and that, importantly, they tended to be more globalized.
Small states have clearly become the lead indicators of new trends in the world economy. More than ever before, small countries are acutely exposed to the economic and political challenges of a changing global environment.
Small countries provide an indication of the future for large countries, and a test bed as to what works and what does not. One innovation in this latest report is to measure the way in which small countries lead larger ones in terms of economic performance. Within Europe, they find that for fiscal and debt-related indicators, small countries appear to be “canaries in the coal mine.” Singapore, it seems, also plays this role on a global basis.
The first index, the Globalization Index, draws together data on three component parts – economic, social and technological. Luxembourg leads the globalization ranking with a score of 0.97, followed by Singapore, Switzerland and Hong Kong.
Further, Credit Suisse found that small countries typically are the leaders in putting “intangible infrastructure” factors like education, technology and healthcare to work in driving growth. Credit Suisse created a “CS Country Strength Index” and found that six of the top ten countries by “strength” are small ones. Luxembourg is ranked 16th with a score of 0.78, equal to Sweden.