In the ever-evolving landscape of sustainable development, the Global Sustainable Competitiveness Index (GSCI) serves as a compass, guiding nations towards a balanced and eco-friendly future. This year, Laos ranked 101 out of 180 evaluated countries.
This mid-range placement brings to light both the achievements and challenges that Laos has been facing. With rich biodiversity and natural resources, the country has the potential to harness its natural capital for sustainable growth. However, challenges in resource efficiency and the precarious economic situation highlight areas where improvements are needed.
Every year, the GSCI evaluates countries based on 190 indicators covering natural capital, resource efficiency, social capital, intellectual capital, innovation, economic sustainability, and governance performance.
In 2023, Sweden leads the index, and Scandinavia dominates the top rankings. Meanwhile, China (30) surpassed the US (32) by two positions, excelling in intellectual capital but lagging in natural capital and resource efficiency.
Despite positive trends in some areas, natural capital is deteriorating globally, while the climate change section emphasizes the urgency of transitioning from fossil fuels. Simulations suggest a fossil tax, with revenue used for renewables and income redistribution, could replace fossils by 2035, benefiting the economy and reducing global energy costs.
The GSCI-based bond rating also proposes adjusting credit ratings based on sustainable competitiveness, considering factors such as natural resource reliance and biodiversity. This could reduce circularity between credit ratings, capital costs, and debt, according to the report.
In the global picture, Laos’ sustainable competitiveness journey remains an ongoing narrative with room for growth and improvement. By focusing on enhancing resource efficiency, fostering innovation, and strengthening governance structures, Laos can steadily climb up the index in the upcoming years.
Examining global trends, the GSCI report reveals a small majority (52 percent) of nations are experiencing positive developments. For Laos, leveraging its strengths and addressing its weaknesses can contribute to this positive momentum.