Bloomberg Innovation Index (“Bloomberg Innovation Index“) crowned Germany as the most innovative country this year. After South Korea's six-year dominance, which set the record for the longest period in the first place, Germany is the most innovative country in 2020. The United States lost one place and landed ninth, meanwhile as Singapore jumped from sixth to third.
The Bloomberg Innovation Index contains many criteria and different metrics: research and development (R&D), activity in the field of patent development, the prevalence of high-tech companies, the concentration of researchers per million people, production opportunities, efficiency of the higher education system, etc.
The 10 Most Innovative Countries in 2020:
2. South Korea
Slovenia in 21st place
Slovenia jumped by 10 places last year, by far the biggest jump among all sixty countries, which Bloomberg publishes. Highest, Slovenia ranks 8th in the production factor and 14th in the efficiency of the higher education system. Our northern neighbor Austria was ranked 11th, Italy 19th, Hungary 28th and Croatia 43rd. According to Bloomberg's ranking, Slovenia has the highest reserves in high-tech companies, as it ranks 40th in this factor. Among other things, we managed to overtake superpowers such as Russia and Canada this year.
Germany in three categories among the top five
4th place at the value added factor of production, 3rd place at prevalence of high tech companies and 3rd place in the field of patents. Germany has long been considered a giant of the automotive industry, but lately, it has been increasingly faced with problems concerning too much greenhouse gas. In addition, the slowdown in the economy and demand was further affected by trade disputes, which in 2019 brought Germany the slowest economic growth in the last six years.
In 2013, when Bloomberg first published the rankings, the US ranked first, today ranked 9th in the field of patents, and the US is home to the largest number of high-tech companies such as Alphabet, Amazon and Microsoft.
Among Asian countries, Japan fell three places to 12th, while China, the world's second largest economic superpower, gained one place and ranked 15th. The biggest “loser” this year is New Zealand, which lost five places and is now ranked 29th – the biggest drop in value added in manufacturing.
The importance of higher education is even greater
Singapore continues to dominate the effectiveness of the higher education system, with almost 85% of the population enrolled in higher education. Germany, on the other hand, reached about 70%. Experts advise all countries wishing to keep their positions on Bloomberg's Most Innovative Countries to continue investing in the next generations, especially as the global economy moves away slightly from production and focuses on services.
“No matter how positive the scale may look, we cannot go beyond the fact that Germany is lagging behind other countries in the field of education, he says. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank. He added that education is a key factor for the highest positions in the future.
The importance of investing in R&D
The “start-up” nation, Israel, is a leader in research and development, and was ranked second after the concentration of researchers. South Korea was also ranked high in the R&D rankings but lost slightly due to lower productivity. Even though South Korea is not the “winner” of the ranking for the first time this year, this country should not be underestimated. Chang Suk-Gwon, professor of business management at Hanyang University in Seoul, said investment in R&D has a decisive impact on the survival of South Korean companies, all of whom are well known to the giants Samsung, LG and Hyundai. “Unfortunately, we don't have any other natural resources – all we have is our brains,” Chang said.
This year's index shows that innovation in countries is key to growth and prosperity. Bloomberg included 200 countries last year, just 105 this year, which sent data for at least six categories.
Finally, a brief link to the current coronavirus crisis. It is very difficult to predict how this will affect the country's ranking in the future, but the fact is that the impact will be large. The economic crisis will spread across the globe and the areas covered by the Bloomberg Index are often the first to fail when times of crisis come. This means less investment in the areas concerned and consequently less development and growth.