S'pore, Taiwan among world's most competitive

update Five economies in Asia-Pacific make top 20 list of world's most IT competitive nations in new study conducted by Economist Intelligence Unit.

update SINGAPORE--Five countries in the Asia-Pacific region have been identified among the world's top 20 economies in IT competitiveness, according to a new report released Thursday.

Commissioned by the Business Software Alliance (BSA) and conducted by the Economist Intelligence Unit (EIU), the annual index ranked Australia, Singapore, Japan, Taiwan and South Korea, in descending order, and measured the extent these countries enabled IT sector competitiveness. The United States leads the global list of 66 countries assessed.

IT industry competitiveness index
1. United States1. United States
2. Finland 2. Taiwan
3. Sweden 3. United Kingdom
4. Canada 4. Sweden
5. Netherlands 5. Denmark
6. United Kingdom 6. Canada
7. Australia 7. Australia
8. Denmark 8. South Korea
9. Singapore 9. Singapore
10. Norway 10. Netherlands
Source: EIU

In the same study last year, the U.S. also topped the pack, with Taiwan in second spot, Korea in 8th and Singapore in 9th positions.

All countries are ranked in six areas: business environment, IT infrastructure, human capital, legal environment, R&D environment, and government support for IT industry development.

Presenting the findings in a briefing here Thursday, EIU research director Manoj Vohra called for Asian governments to continue supporting their countries' technology sectors in the form of stimulus plans and policies.

Broadband penetration, said Vohra, was an area where a government's plans and vision could impact the IT sector. "For every 10 percent rise in broadband penetration, there is a 1.3 percent rise in GDP (gross domestic product)," he said, referring to a 2009 World Bank study.

India, in particular, has not done enough to enable its growing IT talent pool because "slow" policy making and long-drawn-out licensing procedures, inhibit broadband penetration.

"For all of India's IT industry strengths, it scores next to last in this category because of this weakness," EIU said in the report.

According to the latest Internet World Stats, India's broadband penetration stands at 7.1 percent.

Jeffrey Hardee, BSA's Asia-Pacific vice president and regional director, added that the region boasts the highest concentration of human capital in the world.

Its legal environment, on the other hand, is "the weakest", although "that is relatively easier to improve", he said. "The study shows that economies that have strong legal frameworks for the protection of intellectual property are generally the IT leaders and score higher in the index."

Shifts for Taiwan, Korea and S'pore
Also notable in the study was a drop in ranking for Taiwan and South Korea, from second and 8th spot last year to 15th and 16th this year, respectively.

Vohra attributed this to the EIU obtaining "more accurate" data on the number of patents produced by these countries. Last year's patent scores were "over estimated", resulting in higher rankings for the two markets, he explained.

In spite of the drop in research and development ranking however, "[Taiwan and South Korea] still remain among the most prolific of patent producers", he noted.

The study also revealed that Singapore's worldwide ranking in IT infrastructure fell six notches from last year to No. 17 in 2009. Tapping Pyramid Research's data from 2008, the EIU indicated that the island-state had 21 broadband subscribers per 100 people, which affected Singapore's score for connectivity infrastructure--one of the key indicators for IT infrastructure.

However, Singapore's ICT industry regulator the Infocomm Development Authority, measures the country's broadband adoption by household penetration, which stood at 83.9 percent in 2008.

Admitting that subscriber rate may not be an accurate reflection of actual broadband access, Vohra said Singapore's next-generation national broadband network was a positive indication of its government's long-term vision for the country.