“Malaysia is the only economy (in Southeast Asia) to register an improvement of two positions, driven by a strong rebound in economic performance, especially in international trade,” the Switzerland-based research group said in a statement today.

The five most competitive economies in the world remained the same as in 2017, but with a change in order.

The US returned to the number one spot from fourth place last year, driven mainly by its strength in economic performance and infrastructure. It was followed by Hong Kong, Singapore, the Netherlands and Switzerland.

Singapore, which remained unchanged at third place, globally, retained its lead among Southeast Asian economies, aided by its strong government efficiency.

However, the country “continues to be weakened by the high levels of private debt in the economy and the high price level, especially in real estate, which reduces quality of life and talent attraction”, IMD said.

Japan (25th), South Korea (27th), and India (44th) saw slight improvements, while other Asian countries including Taiwan (17th), Thailand (30th) and Indonesia (43rd) dropped several rungs.

The Philippines experienced the most significant drop in the region, shifting nine places to 50th due to a decline in tourism and employment, the worsening of public finances and a surge in concerns over the education system, among others.

“Countries from the region that experienced declines this year, with the exception of Taiwan, all show signs of a need to improve their tangible and scientific infrastructure,” said IMD.

The IMD World Competitiveness Center has been publishing the annual rankings since 1989.

This year, it benchmarked the performance of 63 economies based on more than 340 criteria measuring different facets of competitiveness.