Britain has dropped down the global competitiveness rankings, after a heavyweight global report found that the country was losing out to other countries like the Netherlands and Japan.
Despite the coalition's rhetoric stressing Britain's economic need to succeed in the "global race", the UK fell from eigth place in 2012 to 10th in this year's Global Competitiveness Index (GCI), published by the World Economic Forum.
This comes after a recent report by the IMD Business School classed Britain as one of the economic "losers" in Europe, warning that the UK was "losing [its] dominant position and competitive clout" over the last few years.
Samuel Tombs, UK economist at Capital Economics, told the Huffington Post UK that "Britain could certainly have got on the front foot quicker in the global race."
Howard Archer, chief UK Economist at IHS Global Insight, told the Huffington Post UK: "There has been a lot of talk about reducing red tape and making it easier to reduce our planning restrictions but there is very slow progress made in that area, so Britain could seem to be losing out."
This comes as government sources said the G20 conference today in St Petersburg would be an opportunity for David Cameron and George Osborne to show the British economy remained an "example to the world" and was enjoying a "good moment".
Shadow Treasury minister Chris Leslie said: "After three damaging years of flatlining the economy is finally growing again, but the Tories have delivered the slowest recovery on record. Only two other G20 countries have grown more slowly than Britain since autumn 2010."
However in the WEF report, Hong Kong and Japan leapfrogged Britain was overtaken by Hong Kong and Japan, which rose to seventh and ninth place respectively. Switzerland, Singapore and Finland maintain their dominance at the top of the competitiveness league.
The most problematic obstacle for UK business was deemed to be access to finance, with tax rates and inefficient government bureaucracy ranking in joint second place.
Other problems highlighted by the WEF report included an inadequately educated workforce and tax regulations.
David Kern, chief economist of the British Chambers of Commerce, said that the UK was being held back by its skill shortage. "It's a very tough competitive world with many new players coming up in Asia like Korea and Hong Kong that are now enjoying high levels of education," he told the Huffington Post UK.
"We have to be alert all the time and keep our competitiveness high."
Top 10 Most Competitive Countries, according to the World Economic Forum
- United States
- Hong Kong
- United Kingdom
In response to the report, Labour’s Shadow Business Secretary Chuka Umunna said: "“David Cameron took office promising to make Britain the best place in the world to start a business but things are getting harder, not easier, for our wealth creators under this out of touch Government."