Today’s trade fragmentation means countries and regions are in a race against time to find new strategic advantages in the digital sphere, says IMD’s 2025 Digital Competitiveness Ranking.
Switzerland, the US, and Singapore are the most digitally savvy nations among an eclectic group of 69 global economies, according to the 2025 IMD World Competitiveness Center’s Digital Competitiveness Ranking (WDCR).
Infrastructure, talent, and innovation ecosystems are still standing them in good stead. However, this could be set to change, as trade tensions are increasingly encroaching on data flows, technical standards, and investment priorities.
Leaders everywhere are navigating the unpredictability of AI, talent flows, and regulatory developments, and these three economies prove that world-class infrastructure and talent pools are currently adequate mechanisms to rely on.
And yet, their glory is likely unsustainable amid today’s trade-war-led uncertainty, which is placing significant pressure on digital competitiveness at both the national and firm levels.
As such, the 2025 WDCR – the ninth in its history – uses data from the IMD Executive opinion survey to take a detailed look at industry trends, to help policymakers and executives understand what drives performance both nationally and within their sectors. All this is done vis-à-vis the unique methodology of the WDCR, a product of the thought leadership of economists at IMD’s World Competitiveness Center (WCC).
“Digitally speaking, Switzerland has experienced two important developments so far this year: (1) the cataclysmic effects of tariff changes and (2) the approval of e-ID by a razor-thin margin: (50.4% in favor, 49.6% against). Regarding the latter, it’s clear that the Swiss aren’t as prepared as we might have hoped to embrace the challenges of technology today,” said Arturo Bris, WCC Director.
Global trade fragmentation is currently steering nations’ digital capabilities
Trade fragmentation has dominated headlines all year, driven by a complex interplay of geopolitical, economic, and policy factors.
“Those economies most shielded from the effects are leapfrogging ahead in our digital ranking. One example is Qatar, which is up six places since last year. In contrast, economies highly affected by the twists and turns of trade in 2025 are experiencing a battering in their digital competitiveness. Australia is a case in point – eight places lower in our ranking than it was last year,” said Bris.
Global trade fragmentation is affecting the digital competitiveness of nations in three main ways, he added.
- It’s creating winners and losers in digital infrastructure (the winners have been investing more in recent years in telecoms, internet, and the application of technologies, enabling their domestic reliance).
- While talent remains mobile, the number of people entering certain countries is not as high as they were, due to geopolitical instability. This affects digital competitiveness when domestic policies and regional instability combine to create a situation in which more talent is leaving the country than entering it.
- Regulatory advantages are becoming a key determinant of digital competitiveness. Regulatory clarification and safety enable companies and governments to incorporate the technology available as efficiently and effectively as possible.
Four sectoral trends of relevance
Amid 2025’s global context of trade fragmentation and AI pervasiveness, senior executives and government officials alike must fully understand which economies and industries are most successfully addressing today’s myriad digital challenges – and why.
Such information is key to informing partnership strategies, investment decisions, and talent development priorities and can be accessed via the WDCR’s full 2025 report.
In it, four sectoral trends are identified as instrumental for digital policies in the making, based on responses to 21 survey questions from 6,000 senior executives worldwide. They are:
(1) Infrastructure-intensive industries are outperforming expectations.
(2) Knowledge-based sectors are underperforming, despite their strategic importance.
(3) A lack of venture capital availability is a cross-industry constraint.
(4) Governance frameworks are hit and miss, industry-wide.
The report also helps companies and governments navigate the repercussions of trade tensions on policy by breaking matters down into five key areas: market access and expansion, access to technology, regulatory environment, innovation and R&D, and talent acquisition and retention.
Keeping a keen eye on industry trends is becoming particularly important as AI pervades discussions on digital prowess. Both the 2025 WDCR and the 2025 TONOMUS AI Maturity Index (to be published on 11 November) are supports for executives and policymakers operating in this sphere. The latter dives deep into AI use at the firm level, on an international scale.
The WCC included data on AI-related patent publications (from the WIPO Statistics Database) and on annual private investment in artificial intelligence (from Quid, via the Stanford AI Index Report) in its 2025 WDCR results.
Namibia, Kenya, and Oman are newcomers to this year’s ranking.
