International Competitiveness

Question 1

What is International Competition?

Answer 1

sustained ability to sell goods and services profitably at competitive prices in a foreign country

Question 2

What is International Price Competition?

Answer 2

producing goods/services at lower
price than international competitors

Question 3

What is International Non-Price Competition?

Answer 3

producing goods/services that
are better quality, better designed, have faster delivery, better after-sales service…than international competitors

Question 4

What are Unit Labour Costs?

Answer 4

ULCs are the labour cost per unit of output; a measure that takes into account the costs of employing workers and their productivity

Question 5

What is the Global Competitiveness Index

Answer 5

An indicator that takes into account a whole range of factors that influence both price and non-price
competitiveness

Question 6

What are Relative Export Prices?

Answer 6

If a country’s exports become cheaper relative to its competitors, it becomes more price competitive

Question 7

Strategies to improve International Competitiveness

Answer 7

• Stable macroeconomic environment

• Competitive exchange rate

• Low & stable inflation

• Strong financial & legal institutions

• Competitive tax environment

• Investment in human capital; more education & training; better
healthcare

• Inward migration of skilled workers

• Improvement in management to boost worker productivity

• Increased research and development (R&D) and innovations

• Market competition to raise productivity

• Support enterprise; make it easier to start up a business; reduce
business red tape

• Investment in critical infrastructure (transport, energy,
communication networks)

• Balanced growth across economy’s regions