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China, Brazil, India to top U.S. in global competitiveness rankings

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The results are in: China, India and Brazil will be the most competitive nations in the world when it comes to manufacturing over the next five years.

The United States? Fifth, despite its position as the world's largest economy.

Those rankings are according to the 2013 Global Manufacturing Competitiveness Index, compiled by Deloitte Touche Tohmatsu and the U.S. Council on Competitiveness. The report asks some 550 senior corporate executives for their perceptions of the playing field today, and in five years.

The results are sobering.

Deloitte says:

Over the next five years, 20th-century manufacturing stalwarts like the United States, Germany and Japan will be challenged to maintain their competitive edge to emerging nations such as China, India and Brazil...access to talented workers is the top indicator of a country’s competitiveness -- followed by a country’s trade, financial and tax system, and then the cost of labor and materials. Enhancing and growing an effective talent base remains core to competitiveness among the traditional manufacturing leaders -- and increasingly among emerging market challengers as well.

Here's a look at the top 20, now and in five years' time:

The lesson here? It's not that established economies like the U.S., Germany and Japan (as well as South Korea and Canada) are sinking so much as those of the developing nations are surging. (See the table above, in which Vietnam jumps eight spots and Singapore -- a tiny but wealthy city-state -- hangs onto ninth.)

The report's authors expressed concern over deteriorating U.S. infrastructure, costly energy policies, an unstable tax situation and expected spending cuts as reasons that will hold back the nation's success.

But the U.S. is hardly alone. Developed nations will have a more difficult time competing with others that are plowing significant investment in infrastructure improvements, supplier networks and legal systems, boosting job growth along the way.

The top 10 ways to win the globe, according to the report:

  1. Talent and labor
  2. Economic, trade, financial and tax systems
  3. Labor and material cost and availability
  4. Supplier network
  5. Legal and regulatory systems
  6. Physical infrastructure
  7. Energy cost and policies
  8. Local market attractiveness
  9. Healthcare system
  10. Government investment in manufacturing and innovation

You can read the entire report here.

— By on November 16, 2012, 1:46 AM PST

Andrew Nusca

Editor Emeritus

Andrew Nusca is editor of SmartPlanet and an associate editor for ZDNet. Previously, he worked at Money, Men's Vogue and Popular Mechanics magazines. He holds degrees from the Columbia University Graduate School of Journalism and New York University. He is based in New York but resides in Philadelphia. Follow him on Twitter. Disclosure