Like the majestic Alps that rise high above its landscape, Switzerland has once again summited the U.S. News and World Report Best Countries list for 2023.
It’s the sixth time that the Central European nation has grabbed the top spot in the eight years the rankings have been around, including last year.
“Switzerland has been a perennial and a winner in this particular assessment,” Wharton marketing professor David Reibstein, who helped create the rankings, told Wharton Business Daily. (Listen to the podcast here.) “They are economically stable, they’ve got great education, and it’s one of the top countries people say they would like to live in.”
Canada comes in a close second, moving up from third place last year. Sweden, Australia, and the United States round out the top five, respectively. Despite their high marks, it’s hard to beat Switzerland, which also landed perfect scores for being “open for business” and offering “a comfortable retirement.”
“Switzerland is very high in terms of quality of life and entrepreneurship. It’s just a really stable and safe country,” Reibstein said.
The professor produces the rankings in partnership with U.S. News & World Report and WPP, a global marketing and communications services company. The 2023 list measures perceptions about 87 nations chosen because they contribute most to the world’s GDP. More than 17,000 people around the world were asked to evaluate the countries based on 73 attributes ranging from political stability to racial equity to health consciousness. One-third of the survey respondents were business leaders; one-third were college-educated individuals who were middle class or higher; and one-third were from the general population.
More than just interesting trivia, the list has become a sort of competition for many countries because it relies on scientific data analysis. Reibstein said he’s frequently contacted by country representatives who ask what their nations can do to improve their overall rank.
“Even though [Canada and the U.S.] are right next to each other … they are perceived as very, very different, and what they bring to the table is obviously very different.”— David Reibstein
“This has an impact on tourism, on foreign direct investment, and on foreign trade,” he said. “Those are the three major components of the GDP of a country, and these factors are indicative of how much people are willing to visit a country or how much they are willing to do business with a country.”
The Nations of North America
The United States dropped from fourth to fifth place this year and has been hovering around the same spot since the rankings began in 2016. The exception was its low point of eighth place in 2018: Reibstein attributed that slide to fallout from the contentious presidential election of Donald Trump, which changed global perceptions about the U.S.
This year, the U.S. hit the highest marks for agility, entrepreneurship, and power, but it ranked 23rd for quality of life and a shockingly low 59th for being open for business.
“That’s primarily based on the cost of labor,” Reibstein said. “People don’t want to move their manufacturing to the United States because the cost of labor is really high.”
Canada fared much better on those sub-rankings and achieved an overall score of 99.3, which is very close to Switzerland’s perfect 100.
“Canada is No. 2 for totally different reasons than the United States,” Reibstein said. “They’re perceived to have a great quality of life and also a very strong social purpose. Even though the countries are right next to each other and located in North America, they are perceived as very, very different, and what they bring to the table is obviously very different.”
Mexico ranked 33rd overall, the same as last year. While it received high numbers for adventure, heritage, and cultural influence, it fared poorly along business rankings.
France, Germany, and the U.K.
The U.K. ranked third when the list premiered, and it has steadily gone down. It’s No. 9 this year. Reibstein pinpointed the likely cause as the turmoil around Brexit and political leadership. The country is on its fourth prime minister, Rishi Sunak, in eight years.
France has fallen out of the top 10 for the first time. It landed this year at No. 12, behind Norway.
“There’s probably no country for which there is greater divergence of perceptions than China.”— David Reibstein
“France has really taken a dive downward,” Reibstein said. “Some of that is because of all the [political] strife that’s been happening in the country and terrorist acts that have happened there over the years.”
The professor also noted Germany, which was No. 1 when the rankings premiered and has bounced around the top 10 since then. “Some of that has been changing leadership, some of that has been taking in [immigrants],” he said. “They’re down right now at No. 7, which is the lowest they have been in the eight years of the study.”
China slipped from No. 17 last year to No. 20 this year, but it ranked second behind the U.S. in power, a reflection of its strong political and economic influence in the world.
“There’s probably no country for which there is greater divergence of perceptions than China,” Reibstein said. “There are some people that totally admire China, some that detest some of the practices of China, and almost universally there’s fear of China. Part of that fear is the power that they have.”
But China’s massive economy is slowing, with capital investments generating more debt than growth and a slump in the property sector. “I’m really interested to see what happens in next year’s rankings, when we see some of the downturn in the economy and how that affects things,” he said.
India Is a ‘Rising Star’
India is inching up slowly, from No. 31 last year to No. 30 this year. Even though it hasn’t cracked the top 10, Reibstein said he’s keeping an eye on the country. India doesn’t score well on social purpose, but it ranked fifth as a mover.
“People believe India is a country to invest in, and a country they believe is going to be a rising star,” he said. “If you want to bet on development in any country, India is the one that a lot of people put their money behind.”