At the end of last year, the Global Innovation Index published its annual round up of countries. It was of no surprise to see Switzerland take the number one spot – a position it has held for well over a decade since it wiped the United States from the top in 2009. Since then, the top five leading places have rarely changed, being occupied by Sweden, the US, the United Kingdom and the Netherlands. At BanklessTimes.com, we feel a better way to make sense of the data is to look at the biggest risers and fallers of the year to see which countries are making the most strides, and which are sadly falling behind.
Biggest Risers
You won’t find any of the biggest movers in the top ten, or even in the top fifty for that matter. These are the countries that have been quietly climbing up the rankings and making the greatest progress over the past twelve months:
Botswana
Botswana invested heavily in innovation and technology during 2021, with a focus on developing its education system and promoting entrepreneurship. It seems those efforts are paying off as the Sub-Saharan country now ranks 86 on the Global Innovation Index (GII), jumping from 106th place just a year prior. Botswana is in the upper middle income group and has a total GDP of $41.1billion, translating to a per capita GDP of $17,163.
Botswana comes second in education spending and fourth in new business density. However, it is weak on domestic industry diversification and below average for its income group on ICT.
Ghana
The second highest riser is also situated in Sub-Saharan Africa. Ghana ranks 95 on the GII (up from 112) and is in the lower middle income group with a total GDP of $193.6billion, translating to a per capita GDP of $6,190.
One of Ghana’s key strengths is in the creative goods and services field, where it ranked seventh in the export of creative and cultural goods. Ghana’s weakness lies in the regulatory field, and is being held back by its weak employment protection laws.
Qatar
The desert country of Qatar ranks 52nd on the GII, leaping from 68th last year, and is situated in the NAWA (or Northern Africa and Western Asia) region. Qatar is classed as a high income country with a total GDP of $273.9bn and a per capita GDP of $100,037.
Qatar is the highest ranking country in the tertiary inbound mobility field, ranking first for having the most number of students studying from abroad. It also received a first in the field of general infrastructure, scoring particularly highly for electricity output. Qatar is, however, weak for foreign direct investment and falls behind in enforcing intellectual property rights.
Saudi Arabia
Ranked 51st on the GII, moving from 66th, Saudi Arabia is the highest rated country in the top mover’s category. Another NAWA country, Saudi Arabia is classified as high income owing to its total GDP of $1,734.2billion and its per capita GDP of $48,908.
The country’s Vision 2030 plan puts particular emphasis on innovation and technology and it excels in this area, ranking in sixth position for ICT access. Saudi Arabia also ranks third for its investment in education and fourth for market capitalization per percentage of GDP. It will be of no surprise that Saudi Arabia scores below average for its political and regulatory environment, an area that requires much improvement.
Bangladesh
Bangladesh is situated in the Central and Southern Asia (CSA) region and is classed as being in the lower middle income group, with a total GDP of $953.4billion and a per capita GDP of $5,733. Its overall position at 102 on the GII means that Bangladesh is the lowest scoring country that features in the top mover’s category, but it has climbed from 116th place in just a year.
Bangladesh ranks fifth in the area of labour productivity growth. The country’s main weakness is in the education sector, with low spending and above average teacher-to-pupil ratios.
Indonesia
This year’s GII saw the South East Asia and Oceania region, home to Indonesia, closing the gap on North America and Europe. The island country ranks 75 on the GII, up from 87, and sits in the lower middle income group with a total GDP of $3,530.3billion and a per capita GDP of $12,967.
Indonesia ranks second for its entrepreneurship policies and culture, and this sub-category placement no doubt helped in it being ranked as the fifth best country in the business environment field. One of the areas that needs improvement in Indonesia is its participation in the scientific and technological community, with the country contributing very few articles to the leading journals in these fields.
Pakistan
Like Indonesia, Pakistan also climbed 12 places in the GII, now sitting at 87 rather than 99, and is the final country to make the top movers category. As with Bangladesh, Pakistan is a CSA country that sits in the lower middle income group with a total GDP of $1,157.5billion equating to a per capita GDP of $5,447.
Pakistan scores particularly well in the area of mobile app creation (12th) and has equally high scores in both ICT services exports (22nd) and high-tech imports (22nd). As is the case with many lower middle income countries, Pakistan is let down by its regulatory environment.
Biggest Fallers
While many countries were climbing up the ladder, there were also those that were sliding down it. The following countries slipped down the rankings the most in the 2022 Global Innovation Index:
Belarus
Belarus is 2022’s biggest faller, slipping 15 places down the rankings from 62 to 77. The European country is in the upper middle income group with a total GDP of $200.7billion which equates to a per capita GDP of $21,467.
The current political environment is the main reason for Belarus’s fall, in particular the effectiveness of its government. While Belarus has some key strengths in the education sector, one of its largest drops was in the percentage of females employed with advanced degrees. In 2021, it was ranked first in this area, but in 2022 has slipped all the way down to 32.
Mongolia
The lower middle income country of Mongolia is situated in the SEAO region, an area which has seen the most growth in 2022. But while Mongolia’s GDP has risen from its 2021 rates and is now $43.2billion with a GDP per capita of $12,671, the country itself has fallen from 58 to 71.
This seems to be down to its lack of investment in high-tech, with Mongolia ranked amongst the lowest countries for both high tech imports and exports, and high tech manufacturing. Although having come first in 2022 for both the number of utility models and trademarks filed, perhaps we’ll see a turnaround from Mongolia soon.
Azerbaijan
Azerbaijan sits in the NAWA region in the upper middle income group. Falling from 80, it is now placed at 93 on the GII with a GDP of $155.9billion and a GDP per capita of $15,299.
While Azerbaijan has many strengths including within its institutions, the main reason for its fall is a lack of investment in its knowledge and technology outputs. These issues were highlighted in the 2021 report, and while small steps have been made in the area of knowledge diffusion, this hasn’t improved enough to make a difference.
Tanzania
The United Republic of Tanzania is placed at 103 on the GII, a fall of 13 from last year’s position of 90. The lower middle income country sits in the region of Sub-Saharan Africa with a GDP of $182.9billion and a per capita GDP of $3,062.
In 2021, human capital and research was highlighted as an area that needed significant improvement, particularly when it came to tertiary education. Tanzania had very few graduates in the science and engineering fields and its university rankings were low even for its income group. While there have been small improvements, it has still ultimately slipped further as other countries have progressed at a faster pace. Tanzania’s key strength lies in its loans from microfinance institutions, for which it is ranked first.
Costa Rica
Costa Rica placed at 68 on the GII, falling from 56. It sits in the Latin America and Caribbean (LCN) region with a GDP of $111.9billion and a per capita GDP of $21,592.
Costa Rica’s difficulty lies in the fact that it has done little to invest in its markets. This was highlighted in the 2021 report, but at the time was offset by the country’s high ratings for both creditworthiness and applied tariff rates. The goalposts have changed, however, and in 2022 the GII no longer scores creditworthiness, but rather the financing of start-ups, an area which has limited application for Costa Rica. The rainforest country received the highest scores in its political and government institutions, a particular strength within its income group.
Georgia
Sitting in position 74 on the GII, down from 63, Georgia is an upper middle income country in the NAWA region. It has a GDP of $61.6bn and a per capita GDP of $16,590.
While Georgia is not particularly weak in any specific area, its logistics performance is lagging somewhat (albeit that it has shown some improvement from 2021). Georgia is ranked particularly well for its strong institutions, and it comes second in pupil-teacher ratios.
Armenia
Number 80 on the GII is another upper middle income country in the NAWA region. Armenia has a GDP of $43.5billion and a per capita GDP of $14,701.
Having fallen from 69, Armenia struggles in the area of intellectual property rights, both in terms of making payments and storing receipts. It was strong in many areas of creative output in 2021, but this has sadly dwindled during the past year and now its key strength lies in ICT services exports.
Montenegro
Montenegro has a GII rank of 60, down from 50, and is located within Europe where it sits within the upper middle income group. The country has a GDP of $13.3billion and a per capita GDP of $21,387.
Its infrastructure is a particular strength within its income group and Montenegro excels in the area of ecological sustainability, for which it ranks ninth. As in 2021 the country’s creative outputs are considered a key strength, but Montenegro’s main weakness is in its domestic industry scale, and this has led to its fall in the rankings.
Brunei
Brunei Darussalam is the first high income group country to feature on the fallers list, falling from 82 to 92. It sits in the SEAO region, with a GDP of $30.3billion and a per capita GDP of $65,675.
While Brunei has very strong institutions, it has been marked down in several areas where the scores are weak compared to other countries within the same income group. These are human capital and interest, knowledge and technology outputs, and infrastructure – all of which are new metrics for 2022.
High Income Group Countries Lacking Behind in Innovation
We’ve already seen a couple of countries in the high income group marked down for innovation, and failure to achieve performance in line with their development, but why? The United Arab Emirates, Lithuania and Greece in particular lagged behind in the 2022 index. Could it be the case that other high income countries, like Switzerland, the United States, Korea, Japan and the United Kingdom are simply setting the bar too high? This is true in part, but it is also important to recognise that the data from the GII study was gathered against the backdrop of the Covid-19 pandemic. Innovation is still at a low point and all proxies for innovation impact are experiencing a significant slowdown.
Economists have dubbed this period the great stagnation and while countries such as the United Arab Emirates failed to perform in line with other high income group countries, the Arab state still did exceptionally well climbing five ranks higher in innovation input than its 2021 ranking.
Countries Performing Above Expectations
On the other end of the scale there were countries that surpassed expectations: India, Kenya, Vietnam and Moldova were all Innovation Achievers for the 12th consecutive year.
Vietnam sits in the lower middle income group and scores above average for this group in every pillar. It even manages to score above the average for upper middle income group countries in all pillars, except human research and capital. This year, there were three new countries that made it as Innovation Achievers, including our two top movers, Pakistan and Indonesia, as well as Uzbekistan.
Indonesia in particular is a force to be reckoned with, and this year became the first ASEAN country to partner with Hannover Messe, the world’s leading fair for industry.
Technological Progress Down
In a period of stagnation, it’s not unusual to see that technological progress is low, particularly when taking into account the period when the data was collected, 2020-2021. The short term influences of Covid-19 meant that innovation was not only at a low point, but also that labour productivity and life expectancy received a significant slowdown.
While actual progress may have been slow, there has nonetheless been unremitting enthusiasm for investment in science and innovation.
The CEO of BanklessTimes.comWith the pandemic forcing a slowdown in productivity and the scientific community focussing its efforts on treatments and vaccinations, one might have expected investments in new technologies to take a backseat. However, the GII shows a very different story, with a boom in venture capital and a steady growth in the number of scientific articles published worldwide.
