And the top stress test award goes to…Denmark. So what does this mean? It only means that Denmark is the best survivor when it comes to overcoming the global financial crisis that has badly affected many parts of the world.
The IMD has found Denmark to be the country best equipped to manage the economic downturn and enhance its competitiveness going forward. This was what the group discovered as it conducted its 2009 Stress Test on Competitiveness that surveyed countries in a better position to survive. IMD’s ranking was based on the results of the 2009 World Competitiveness Yearbook.
In the top 5 rankings, Denmark is followed by Singapore, Qatar, Norway and Hong Kong. These five countries are depicted as focused towards the future with considerations on exposure, readiness and resilience amid a global crisis. The United States which topped the World Competitiveness Yearbook ranks only 28th in the stress test.
What made Denmark a standout were the ability of its government and businesses to readily recover from a recession and to adapt to changing times as well as the stability of its society. IMD director Professor Stephane Garelli pointed out that this Nordic country shows admirable flexibility in its workforce, political stability and reliability in management which are vital factors in adapting to new and changing conditions. With these important characteristics, he said, a country is sure to overcome any crisis in a strong position.
Financial analysts agree that smaller economies notably those with a population of less than 30 million usually fare well in times of crisis. They are more export-oriented and with stable socio-political environments. Additionally, while they are able to rebound easily and adapt to tough times, some may have also implemented better policies as a result of having gone through financial crises in the past.