Sweden has risen one spot in the rankings to claim 4th place.
While competitiveness across Europe is declining, this Scandinavian country was called a "shining success" by Professor Stephane Garelli, director of the IMD World Competitiveness Center.
According to IMD's survey of business leaders, the country is attractive because of its political stability, skilled workforce, reliable infrastructure and effective legal environment.
But the country's tax regime is considered a clear weakness.
