Bangladesh has advanced 25 notches up to rank 77th in the latest competitive industrial performance (CIP) index. Its position in CIP was 102nd in 1990.
Among the south Asian nations, India stood at the 44th, Nepal 128th , Sri Lanka 78th and Pakistan 72nd, according to a new report titled Competitive Industrial Performance Report 2012/2013 recently released by the United Nations Industrial Development Organization (UNIDO) and the World Economic Forum (WEF).
The CIP ranking does not include Afghanistan, Bhutan and the Maldives.
The CIP index is a composite index that measures the ability of countries to produce and export manufactured goods competitively, using several individual indicators to proxy various dimensions of industrial performance.
The CIP report also involves the concept of competitiveness and industrial performance and provides a theoretical foundation and justification for the CIP index, ten years after its first publication.
The CIP ranking, which includes 114 countries, puts Germany, Japan, the United States, the Republic of Korea (ROK) and China at the top of the most industrially competitive nations when the bottom five were Paraguay, Congo, Gabon, Kenya and Suriname.
Besides, Poland and China, Bangladesh showed the phenomenal move in the CIP ranking. During 1990-2012, Poland and China moved up by 29 and 27 steps accordingly.
Germany tops the CIP ranking due to its high level of industrial exports while Japan’s industrial competitiveness is supported by its large manufacturing base, high-tech exports as well as enhanced per capita manufacturing.
Industrial competitiveness in the US also arises from its large manufacturing base, although this is more aimed at the domestic market compared to Japan or any other developed country. South Korea has a competitive manufacturing sector based on a high share of medium- and high-tech industries.
While noting the significant improvement of Bangladesh in the CIP ranking, the report also brought attention to some major challenges, suggesting that those should be addressed carefully.
“Skills and talent improvement, innovations, industrial policy and resource efficiency are four areas, which are in the common interest of government, the private sector and society,” it said.
“It is critical to address this convergence of interests because overlooking an advanced manufacturing strategy could lead to a lack of competitiveness within manufacturing value chain.”
It also recommended that the manufacturing sector needs to move into a more proactive strategic approach to meet key challenges such as demographic shifts in the consumer market, skills gap and technological innovations.
The report said economies occupying the middle quintile of the CIP ranking are again very heterogeneous. With the exception of four large and highly populated countries, namely Iran, Egypt, Pakistan and Bangladesh.
The remaining countries are mainly small economies from South and Central Asia, Latin America and Africa.