Leveraging National Assets to Build Future Global Competitiveness

By Deborah L. Wince-Smith, President, Global Federation of Competitiveness Councils; President and CEO, Council on Competitiveness (United States)

From left to right: Mr. Fotis Kourmousis, Member of the Board of Directors of the Hellenic Development Bank and Deputy Head of the Council of EquiFund; Dr. Mohd Yusoff Sulaiman, CEO & President Malaysian Industry-Government Group for High Technology (MIGHT); Mr. Athanasios Savvakis, President, Federation of Industries of Greece, Mr. Olin Wethington, Chairman, Wethington International LLC, Mr. Simos Anastasopoulos, President, The Council on Competitiveness of Greece, Chairman & CEO, PETSIAVAS S.A.; Hon. Deborah Wince-Smith, President, GFCC, President & CEO, Council on Competitiveness. Credit: Delphi Economic Forum.

After two years of more ZOOM meetings than I can count, I was thrilled to travel to Athens in April to participate in person at the Delphi Economic Forum.

Applying a Lessons Learn from History

Greece and its history are very special to me. While pursuing my master’s degree in classical archaeology, I studied in Athens and did my fieldwork excavating at Agios Stephanos in Laconia. My focus was Bronze Age Greece, its value-added manufacturing and innovations ranging from advancements in metallurgy to the Linear B form of writing that enabled its control of production and trade across the Mediterranean. This work had a profound impact on my thinking about the indispensable role knowledge and technology play in driving human progress, prosperity, global competitiveness and geopolitical power. Throughout history, the game-changing civilizations were all innovators and reached out at scale for global alliances, collaboration and trade. They leveraged the knowledge and technology they absorbed from other countries and cultures to fuel their own capacity for innovation.

Engaging around the world is even more important in today’s global economy being reshaped by disruptive technologies, rapidly shifting markets, an expanding competitive arena and grand global challenges. That’s why we created the Global Federation of Competitiveness Councils (GFCC), to establish new routes for trading knowledge, forging global alliances, and co-creating new competitiveness strategies to benefit GFCC’s member nations. We share what we have learned through reports, exchanging best practices and at the annual Global Innovation Summit (GIS). Dr. Mohd Yusoff Sulaiman, President and CEO of the Malaysian Industry-Government Group for High Technology (MIGHT) noted Malaysia benefitted significantly from hosting the 2017 GIS in Kuala Lumpur and stressed the importance of having conversations and exchanging best practices which can always happen in the GFCC.

Putting this philosophy to work at the recent Delphi Economic Forum, the GFCC and Delphi convened a panel on Leveraging National Assets to Build Future Global Competitiveness. We hosted five stellar panellists: Simos Anastasopoulos, President of the Council on Competitiveness of Greece and CEO of Petsiavas SA; Fotis Kourmousis, Member of the Board of Directors for the Hellenic Development Bank and Deputy Head of the Council of EquiFund; Athanasios Savvakis, President of the Federation of Industries of Greece, Chairman of the Hellenic Energy Exchange, and CEO of Savvy Can–Hellenic Metal Packaging SA; Dr. Mohd Yusoff Sulaiman, President and CEO of MIGHT; and Olin Wethington, Chairman of Wethington International LLC, and former high-level U.S. government official including service as Assistant Secretary of the Treasury for International Affairs and Special Assistant to the President of the United States and Executive Secretary of the White House Economic Policy Council.

From Local to Global

The panel previewed the theme for the GFCC’s 2022 GIS — Building Competitiveness: From Local to Global, which will convene in Athens in November. While competition is global, a nation’s competitiveness arises from a foundation of assets built over time in a country’s regions and cities. The Delphi panel discussion was a microcosm of this local-to-global theme and reinforced five future-defining dimensions of competitiveness — innovation, sustainability, inclusiveness, resilience, and partnership — the focus of the GFCC’s Frame the Future initiative.

Pressing Challenges

The panellists talked about the challenges their countries face in the current economic and geopolitical environment — recovering from the virus economy, the difficulty of planning for the future in uncertain times, the Russian invasion of Ukraine and the intensifying strategic competition between the United States and China. The war in Ukraine has created great concern about the cost and supply of energy, stoked inflationary pressure, and diverted Europe’s attention away from meeting ESG goals with the growing likelihood that Greece cannot meet the EU’s 2030 target for renewable energy. Northern Greece faces a big challenge. Its businesses leveraged the collapse of the Soviet Block by expanding their markets in those countries. The war has disrupted these markets, and now these Greek businesses must find new markets for their products in the agri/food sector, minerals, and high-quality building materials.

Nevertheless, over the past few years, aggressive investment and economic reforms put Greece on a pathway to recovery from its economic crisis. It had record economic growth and investment in 2021, repaid its debt to the IMF and improved its competitiveness. Over 2016–2021, Greece moved up in the World Competitiveness Yearbook rankings from 58 to 46 out of 64 countries, showing progress even during the pandemic — a testament to national resiliency, and demonstrating that Greek companies are resilient, flexible and can overcome challenges. The economic outlook has improved markedly, with the expectation of three percent growth this year, but there are concerns about inflation and lagging productivity.

Taking Steps Now to Build Future Global Competitiveness

Panellists highlighted unique opportunities to build future global competitiveness at this pivotal moment as we emerge from the pandemic.

Greece. Greece is adopting a new growth model based on innovation and manufacturing. Athanasios Savvakis, President of the Federation of Industries of Greece stressed the need to put manufacturing at the forefront of Greek efforts to diversify an economy so dependent on tourism. With the goal of increasing manufacturing’s contribution to Greece’s GDP from 10 percent to 12 percent by 2025, the Federation has a new four-pillar industrial strategy for investment in Industry 4.0, digital transformation, green transition, and building resiliency. The Competitiveness Council of Greece has several important projects on building future competitiveness from the bottom-up — considering regional competitive advantages and weaknesses, promoting efforts to boost regional competitiveness and cluster development, and competitiveness metrics for regions.

Simos Anastasopoulos, President of Greece’s Competitiveness Council and Fotis Kourmousis, Member of the Board for the Hellenic Development Bank stressed that the €30 billion in loans and grants that Greece is receiving from the €1.8 trillion in Next GenerationEU pandemic recovery funds is a potentially game-changing opportunity to build the country’s future competitiveness. About 38 percent will go to the green transition and 23 percent to digital transformation. These funds will support things such as grid upgrades to better access renewable energy resources, undergrounding of electricity distribution to improve resiliency, environmental remediation and energy efficiency upgrades for buildings. Funds for digital transformation will go to building out high-speed Internet access and 5G networks, digitalization in small and medium-sized enterprises, and digital skills development. Some loan funds will be used to enhance Greek private sector investment and competitiveness across five economic priorities: green transition, digital transformation, promoting exports, financing R&D, and promoting economies of scale.

Malaysia. MIGHT is leading Industry 4.0 for Malaysia. It developed a Malaysian Foresight Institute to analyse trends, scan the horizon, and develop future scenarios to help government and industry systematically strategize and plan for the future. Strategic funding and incentives are key to enriching national assets to position the country to take advantage of future developments quickly. Based on a vision for its future, Malaysia set a goal to increase R&D as a percent of GDP from 1.04 to 2.5 percent. Other important areas for future competitiveness include building agile infrastructure including broadband, developing new skill sets, regulatory reforms, and greater deployment and use of new technology. Government has a key role to play in mobilizing efforts to build the nation’s competitive assets in partnership with the private sector, NGOs and other stakeholders.

United States. In the United States, the Council on Competitiveness established a high-level National Commission on Innovation and Competitiveness Frontiers. In its first report on Competing in the Next Economy, the Commission made 50 concrete recommendations, and the Council worked with U.S. government leaders to advance them. Legislation is now pending in Congress that includes provisions that mirror Commission recommendations, including substantial increases in critical technologies R&D, efforts to expand the U.S. innovation ecosystem beyond the East and West Coasts into America’s heartland, and a National Microelectronics Strategy recognizing that microelectronics are the foundation for everything in our digital age.

Emerging Global Competitiveness Challenge

Given his decades of experience in the international economic arena at the highest levels of the U.S. government, I asked Olin Wethington to characterize the evolving nature of global competition, and he offered a warning and some advice for national leaders. At the global scale, we operate in an interdependent world — progress and prosperity require partnerships and collaboration. However, while globalization is not dead, there is increasing separation between advanced democratic market-oriented economies, and authoritarian state-directed economies in terms of government policy and business strategy.

Europe and the United States are currently focused on the immediate challenges of energy dependency and energy security. But in the long term, the most acute manifestation of this fragmentation in the world order and the biggest challenge is the competition in advanced critical technologies that have both commercial and national security implications, and the convergence of the two. Capturing that reality, Chinese President Xi said scientific and technological innovation has become the main battlefield of the international strategic game, and that China must seize the commanding heights of technology. To achieve global technology leadership, for a decade China has made new levels of very intense R&D in China to support the development of critical technologies.

To meet this global challenge, advanced democratic nations — the United States, those of the EU, and other like-minded countries who rely on market mechanisms for their prosperity — must demonstrate the same kind of unity they have shown in the context of the Russian invasion of Ukraine but in an economic context with heightened partnership and collaboration. We need a common set of rules, better use of institutions, and common standards. Choices will need to be made based on fundamental values and common interests. In this competition, neutrality is no longer a choice.

Join us in Athens!

The quest for building a nation’s competitiveness is gaining momentum worldwide. Countries are examining their economic assets — natural, human, business capacity, R&D, and more — and how to strengthen and leverage them for competitive gain. They are reframing their strategies, executing new policies, and implementing new programs to boost their ability to compete.

Place matters. Cities accumulate assets needed for innovation and new business formation — talent, capital, technology and infrastructure of all kinds. They attract highly educated workers and entrepreneurs who share knowledge within and across industries, forming networks humming with ideas, creativity and economic potential. But digitalization has enabled talent to move away from big cities to small towns and even the countryside, reinvigorating and creating new opportunities for local economies. These moves suggest new possibilities to advance place-based innovation, and make national economies more balanced across regions, inclusive, resilient and competitive.

The places and organization of a nation’s economic engines and building assets that support their growth, and competitiveness will be at the core of the 2022 GIS — Building Competitiveness: From Local to Global, when we gather in Athens over November 14–17. The GIS will explore the many aspects of building competitiveness from the local to the global level and the interplay between local and national strategies.

In the run-up to the 2022 GIS, the GFCC will soon launch a series of online discussions to scout and scope the issues we will explore in Athens. We need your input! Also, we plan to post insightful blogs from leaders, GIS partners, and GFCC members in Greece, including Simos Anastasopoulos, President of the Council on Competitiveness of Greece, Symeon Tsomokos, Founder and President of the Delphi Economic Forum, and others. So, stay tuned, and plan to join us in Athens.