"The Nordic countries should create greater clarity about the position they wish to have in the global economy." This was the appeal to the Nordic prime ministers from the author of this year's Globalisation Barometer and professor at Harvard Business School, Dr. Christian Ketels,

He further believes that the countries need to answer two important questions, “What activities does the region want to attract, and how do these activities create value for their citizens?

The responsible monetary and fiscal policies implemented during the economic crisis will benefit the competitiveness of the Nordic economies in the future too. However, that is probably not enough to meet the changing challenges that globalisation gives rise to," says Dr. Christian Ketels.

The pressure that globalisation exerts on the global economy is changing the base of value creation and the way that existing benefits are converted into economic revenue. Policies should therefore focus on specific bottlenecks for value creation in the Nordic economies.

Above all, the Nordic countries need more bang for the buck in innovation and education policies. The report shows that weaknesses in Nordic education and innovation infrastructure mean that the resources allocated do not generate enough income in the form of increased productivity in their economies.

Despite high performance in innovation and entrepreneurship with many start-ups, patents and sophisticated businesses, significant economic results are not forthcoming because of a lack of ability to get new businesses to grow and scale up their operations. New approaches, such as a more aggressive use of demand-driven innovation policy, need to be developed and implemented.

And if the Nordic region wants to live off knowledge in the future, the economic efficiency of spending in education must increase, writes Dr. Ketel. The recommendation is that the structural changes that started in the region in education in recent years must be completed, evaluated and developed.

Otherwise, the annual Globalisation Barometer shows a remarkably strong economic recovery in the Nordic countries after the crisis, except in Iceland, which is a special case following the collapse of the financial market. The Nordic region's strong macroeconomic competitiveness has been a cornerstone of building Nordic success in the last decade. The report highlights the strong institutions, well-developed conditions for demand, and sophisticated corporate and macroeconomic policies in the Nordic countries as the reasons for this position of strength.

At the same time it stresses that continued success in the global economy is not only about identifying the right questions and formulating suitable policy responses, but also acting on this knowledge. Dr. Christian Ketel emphasises, therefore, that Nordic co-operation provides an opportunity to learn from each other and to use the differences to strengthen the countries' and the region's global competitiveness.

Mats Holmström
Phone +45 33 96 02 91
Email maho@norden.org