The findings of the Global Entrepreneurial Index 2017 are released
The Global Entrepreneurial Index (GEI) 2017 has provided an assessment of how nations rank in terms of the environments they provide encouraging entrepreneurs to create new businesses. While many of the leading markets, such as the USA, have long topped the GEI’s findings, the 2017 report showed some interesting changes in emerging regions too. The information should allow governments around the world to help target infrastructure that can support new businesses.
The methodology behind the report
The Global Entrepreneurial Development Institute (GEDI) in charge of drafting the report was founded by leading experts on entrepreneurship at Imperial College London, George Mason University, and the University of Pécs. The organization monitors developments in attitudes and infrastructure around the world, and provides information on how well countries foster entrepreneurial spirit. The data collected by GEDI is ultimately presented in the annual GEI Index. Information delivered through this process has been used by the EU and the UN to help develop economic growth.
The GEI Index combines data on national levels, such as education, government support for startup businesses, and economic freedom, with small scale research on individual areas and people. The micro level data looks at things such as risk acceptance, opportunity recognition, and individual skill sets, to assess how likely a person in a given region is to venture into the world of starting up a business.
A total of 165 nations were analyzed, and then ranked in order with a score out of 100.
The 2017 GEI Index is the first report to include additional research on 4 areas of the digital entrepreneurial ecosystem. These were: Digital Citizenship, Digital Governance, Digital Marketplace and Digital Business. The authors of the GEI Index believe that if governments act upon their findings, increased entrepreneurial activity could lead to growth for the global economy of up to $22 trillion!
Leading trends highlighted
The USA was once more listed as the world’s leading nation for its entrepreneurial ecosystem, meaning that no other country is as likely to see people start and successfully develop new businesses. However, the longtime leader of the pack is having the gap closed, as other country’s increase their support of entrepreneurial spirit.
Switzerland took a surprising second place in the GEI Index 2017, with a GEI score of 78, behind the USA’s leading 83.4.
The rest of the top ten digital countries, and their respective scores, were: Canada (75.6), Sweden (75.5), Denmark (74.1), Iceland (73.5), Australia (72.5), the United Kingdom (71.3), Ireland (71.0) and Netherlands (67.8).
There were other nations who showed huge improvements upon last year’s report, with India’s score of 25.8 moving it up a huge 29 places to 69th place, while Tunisia and China moved up 20 and 12 places respectively, to 42nd and 48th positions. Elsewhere in Asia, Japan overtook South Korea for the first time since 2013, and Taiwan remains Asia’s highest ranking nation at 16th place.
However, entire regions of the developing world are also showing positive signs of development within entrepreneurship. The report found that Sub-Saharan Africa came top for “Opportunity Perception”, meaning that a good proportion of the population are starting successful enterprises, despite huge obstacles within national infrastructure, the environment and regulatory systems.
The authors of the report believe that both the developed and developing worlds can improve in different areas to maximize the benefits of entrepreneurship.
Areas for improvement identified across the globe
The report indicates that growth within all of the nations listed should be a realistic goal, as different regions have different strengths and weaknesses.
Co-author of the 2017 report, Zoltan Acs, said, “While institutional variables still need to be strengthened in emerging economies—where individuals are running ahead of policymakers—in developed countries individuals need to be shakened up. In other words, not enough people in developed countries—including the United States—are starting productive high-growth businesses.”
It is therefore clear that even the top ranked nation has substantial room for improvement, while many nations in developing regions have huge opportunities to build upon the infrastructure that could support the widespread, entrepreneurial spirit of their people.
Acs pointed out that China and India have substantially strengthened their support of entrepreneurs, and as such have seen the creation of “billion dollar startups”, while Malaysia, Iceland and the Baltic States have shown particular strength in “digital entrepreneurship”.
The findings of the 2017 GEI Index helped shape policy discussions at the Global Entrepreneurship Week, and the authors firmly believe that governments and international bodies can use the information to create huge boosts in prosperity.
President of the Global Entrepreneurship Network, Jonathan Ortmans, summed up this belief saying, “The promise of jobs, economic growth, and the optimism and hope that entrepreneurs bring to government… has generated an extraordinary increase in attention from all levels of government in empowering their entrepreneurial ecosystems.”
As more governments push to develop these systems, only time will tell whether one of them can replace the USA as the world’s most entrepreneurial nation.