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Legal and Regulatory System

2013 Global Manufacturing Competitiveness Index


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Much like with the supplier network driver, executives ranked developed nations as leaders when it comes to the competitive advantage they deliver through their legal and regulatory systems. Stability and clarity within the legal and regulatory environment stood out as the primary factor influencing the individual country rankings. This is supported by executive input outlined in Ignite 1.0: Voices of American CEOs on Manufacturing Competitiveness, developed by Deloitte and the Council, and those executives' concerns with respect to the consequences of uncertainty. Other contributing factors include labor laws and regulations, compliance costs, intellectual property protection, enforcement of laws and regulations, and antitrust regulations.

It may not be surprising that emerging economies trail in the rankings of the six focus countries highlighted in the 2013 GMCI. However it is interesting that these nations appear to be substantially further behind developed nations when compared to how executives evaluated each country’s supplier network advantages. Survey results also reveal that China and Brazil, with respect to the strength and competitiveness of their legal and regulatory system, are also ahead of India.

CEOs viewed the legal and regulatory systems in developed nations more than twice as strong as those in emerging nations, primarily as a result of stability and clarity within their legal and regulatory environments.

At the opposite end of the spectrum are the developed nations, which despite their competitive strengths, are struggling with burdensome, uncertain and often complex legal and regulatory systems. The intellectual property protections afforded under the U.S. laws and regulations, for example, are highly regarded. However the competitiveness of the developed nations could be better served by reducing the cost and complexity of regulatory compliance. This can be achieved through the streamlining of processes, reduction in fraud and waste, and removal of outdated aspects of the laws. While emerging economies could focus more on developing better legal and regulatory systems, developed economies could focus more on better management of their existing systems to promote efficiency and competitiveness.

2013 Global Manufacturing Competitiveness Index

Main page: Return to the 2013 Index overview
Continue reading: Country analyses, appendix A

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About The U.S. Council on Competitiveness
The Council on Competitiveness is a leadership organization comprised of CEOs, university presidents, and labor leaders committed to ensuring that the United States remains the world leader. The Council has one goal: to strengthen America's competitive advantage by acting as a catalyst for innovative public policy solutions. For more information please visit www.compete.org.

About Deloitte
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms