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China moved up sharply in an influential international competitiveness evaluation that was released on Wednesday.

The Lausanne, Switzerland-based International Institute for Management Development (IMD) lifted China from 31st to 19th in its annual competitiveness ranking report that includes 61 major economies in the world.

The dramatic change shows that more international observers are recognizing China's growing strength.

However, it should be no excuse for the nation to become complacent.

In the latest version of an equally well-received competitiveness report by the Geneva-based World Economic Forum, released last year, China slipped three places to 49th among 117 economies.

In a sense, the country's rise in the IMD rankings reflects difficulties for international researchers in understanding situations of a transitioning economy as big as China's.

This year's climb in rankings came after a drop from 24th to 31st in last year's report. However, China's changes during the year did not seem to be big enough to justify such a radical elevation.

It is true that the country has been improving in many aspects. But outside observers' positive remarks should not make people inside overestimate themselves.

We need sober minds to see what is yet to be accomplished. The country still faces myriads of formidable challenges on many fronts.

Factors considered by the IMD evaluators are economic performance, government and business efficiency, and infrastructure. China won high scores in economic performance, and it also improved in the other three factors.

However, if improvement in these three categories stops and moves too slowly, the country could easily be derailed from the fast track and overall competitiveness would certainly fall. There are many more variables that may affect an economy's overall competitiveness, which could be more complicated than elsewhere.

Specifically, the legal environment and development of societal framework, which is related to government efficiency, remain far from satisfactory. Health, environment and education all key criteria in the infrastructure sector have been jutting issues that are considerably limiting the country's growth potential.

At the business front, reforming State enterprises and banks is still an unfinished agenda.

Competitiveness reports like the IMD's are meant to be reference for international investors. They also provide domestic policy-makers with a perspective on a country's merits and defects in comparison to others.

But they are only a reference. It would be unwise to give them undue weight in evaluating a country.

(China Daily May 12, 2006)