GENEVA - China's competitiveness ranking dropped from the world's 26th in 2011 to 29th this year, its first decline since 2005,according to a report released by the World Economic Forum (WEF) Wednesday.

But China continued to lead the group of large emerging market economies, the Global Competitiveness Report 2012-2013 said.

Among the other four BRICS economies, only Brazil, which ranked the 48th this year, moved up this year. South Africa, ranking the 52th, India, 59th, and Russia, 67th, also experiencing small declines in rankings among 144 economies in the world.

Margareta Drzeniek Hanouz, Senior Economist of the WEF and co-author of the report, said that the change of China's ranking is so small and it was hard to interpret right now.

"It's only very tiny decline. China is still doing very well," she said.

She said the gap between China and the other BRICS countries is going to remain for the time being, while Russia's accession to the World Trade Organization might bring some changes to its ranking in the future.

Switzerland, for the fourth consecutive year, topped the rankings. Singapore, Finland and Sweden took the second, third and fourth position respectively.

The report indicated that Switzerland and countries in Northern Europe have been consolidating their strong competitiveness positions since the economic downturn in 2008.

On the other hand, countries in Southern Europe, for example, Spain, ranking the 36th, Italy, 42nd, Portugal, 49th, and Greece, 96th, continued to suffer from competitiveness weaknesses in terms of macroeconomic imbalances, poor access to financing, rigid labour markets and an innovation deficit, said the report.

The United States continued its decline in the rankings for the fourth consecutive year, falling two places to the 7th. It's overtaken by Netherlands, ranking the 5th, and Germany, the 6th.

Hanouz said there is a political deadlock that is not able to address the issues confronted by the United States, including the macroeconomic stability concerns and rising public debts.

"Trust in politicians has been falling over the past years," she said.

Britain, Hong Kong and Japan completed the ranking of top 10 most competitive economies.

In the Middle East and North Africa, Qatar, ranking the 11th, continued to lead the region, while Saudi Arabia, ranking the 18th, remained among the top 20, according to the report.

In sub-Saharan Africa, South Africa and Mauritius were in the top half of the rankings, however, most countries in the region continued to require efforts to improve their competitiveness, said the report.

Chile, ranking the 33rd, retained the lead in Latin America and a number of countries in that region saw their competitiveness improve.

Klaus Schwab, Founder and Executive Chairman of the WEF, urged governments to act decisively by adopting long-term measures to enhance competitiveness and return the world to a sustainable growth path.

"Persisting divides in competitiveness across regions and within regions, particularly in Europe, are at the origin of the turbulence we are experiencing today, and this is jeopardizing our future prosperity," he said.

The report's competitiveness ranking is based on the Global Competitiveness Index (GCI), calculated by drawing together public and private data around 12 key categories, including institutions, infrastructure, macroeconomic environment and innovation, among others. They together make up a comprehensive picture of an economy's competitiveness.