Competitiveness is based on a combination of economic, social and political elements. The economic aspects, focus mainly on the comparative advantages and disadvantages of particular locations, together with their labor forces, skills' levels and other advantages. The social dimensions are more concerned about the distributional aspects and the means to reduce differences between different population segments, which is a clear contrast to what the economic aspects of competitiveness deals with.

 

The governance aspect, on the other hand, provides the balancing act between the economic imperatives and social aspects, whilst at the same time, ensuring the fairness between all parties so that competition can take place.

In order to effect change (figure above) the following eight imperatives, that are a combination of those economical, social and governmental elements, needs to be implemented;

1. Defining and making explicit our moral goal: a sustainable, high and rising standard of living.

2. Understanding that the world has changed dramatically: political boundaries have disappeared, costs of communications, transportation and learning are declining rapidly. In other words, we should reach a level of openness to free trade and seek a competitive position for local industries in the global scene, rather than the local one.

3. Acknowledging that we are over-dependent on the basic advantages of location, and the wealth of natural resources.

4. Understanding that wealth in the future is based on insight, sophisticated human capital, optimistic cultural attitudes advocating competition, learning, trust, cooperation and investment in intricate edges.

5. Understanding that economic growth and social equity is one and the same thing. Indeed, there must be no trade-off between generating growth and income redistribution.

6. Understanding that competitiveness is productivity; and productivity is where we choose to compete and how we choose to compete. Strategic choices, such as which industries to compete in, what products to produce, the distribution of those products, as well as the human resources strategies implemented are very fundamental to the success of enterprises and act as the building blocks to generate wealth, and sustain it.

7. Acknowledging that the government must do everything it can to assist the private sector, without impeding competition, generally speaking, governments’ role must incorporate setting up a predictable economic environment, as well as developing specialized infrastructure and investing in its educational systems. Moreover, ensuring a non-defensive sustained dialogue between the public and the private sectors.

8. Understanding that the private sector needs to invest more in identifying the most sophisticated and demanding customer preferences, its position relative to its competitors, possibilities of changing the distribution channels, and upgrading products.