Canada’s rank fell in one competitiveness index and improved in another, according to the Global Competitiveness Report released Wednesday by the World Economic Forum.

On the business competitiveness index (BCI), Canada fell from 12th last year to 15th in 2004. On the growth index, Canada improved slightly from 16th to 15th. The forum’s Canadian partner is the Toronto-based Institute for Competitiveness and Prosperity.

The BCI was developed by Michael Porter, director of the Institute for Strategy and Competitiveness of the Harvard Business School. The index draws on economic data and surveys of more than 8,700 business leaders around the world to develop microeconomic indicators that measure the set of institutions, market structures, and economic policies supportive of high national prosperity.

Roger Martin, Dean of the University of Toronto’s Rotman School of Management and chairman of the Institute for Competitiveness & Prosperity, noted that this year’s fall in rankings is part of a trend. In all but one of the last six years, Canada has fallen in the BCI Rankings.

“In 1998, Canada stood sixth in this ranking and in 2004 we stand 15th, said Martin. Among the larger economies – those with half of Canada’s population – we’ve fallen from 5th to 8th”.

Martin also observed that the real source of Canada’s decline in the rankings has been the quality of the national business environment.

“Canadian business and government leaders still have a lot of work to do to strengthen Canada’s competitive position in the world,” said Martin.

On the Growth Competitiveness Index (GCI), Canada improved from 16th to 15th. The GCI estimates the underlying prospects for growth over the next five to eight years.

According to Martin, “we noticed a heightened antipathy towards government institutions in 2003 and this improved slightly this year, but not back to the 2002 levels”.

In 2004, the Institute believes that the sponsorship scandals in Ottawa had their impact.