Thanks to improved business efficiency, the Chinese mainland saw its competitiveness ranking rise two places to 21st in IMD Business School's world competitiveness report.

"China is stable in terms of economic performance, whereas other countries are facing difficult times. There is an improvement in the business efficiency factor, more specifically in the labor market, finance, management practices and attitudes and values," Anne-France Borgeaud Pierazzi, senior economist and head of IMD World Competitiveness Center Operation, told China Daily.

Sixty economies around the world were compared in terms of economic performance, government efficiency, business efficiency and infrastructure.

China's ranking in business efficiency jumped from 32 in 2012 to this year's 25, and its ranking in infrastructure rose from last year's 29 to 26, mainly due to a significant improvement in technological infrastructure.

In terms of the major challenges facing China's competitiveness, the report said reforming public administration toward a service-oriented system, controlling the real estate bubble, and addressing the emerging deficit of the social insurance fund were the top challenges.

The report, released on Thursday, said China had been one of the nine "winners" since 1997.

Other "winners", including Germany, Israel, South Korea, Mexico, Poland, Sweden, and Switzerland, have jumped more than five places in the report's ranking.

The IMD Business School praised China's role in Asia, saying its success has had a positive effect on the region's competitiveness, prompting many Asian economies to redirect their exports from the United States and Europe to other emerging markets.

The US is first on the IMD business school's annual list after coming second in 2012, thanks to a rebounding financial sector, an abundance of technological innovation and successful companies.

Switzerland's export-oriented manufacturing economy was in second place.

Apart from Switzerland, Sweden and Germany, the rest of Europe is heavily constrained by austerity programs that are delaying recovery, while France and the United Kingdom in particular have lost their competitive clout, IMD said.

One-third of the ranking is from a survey of 4,200 executives, with the remainder pulled from statistics such as gross domestic product and government spending on scientific research.

"In the end, the golden rules of competitiveness are simple: manufacture, diversify, export, invest in infrastructure, educate, support small and medium-sized enterprises, enforce fiscal discipline, and above all maintain social cohesion," said Stephane Garelli, director of the IMD World Competitiveness Center.

Another competitiveness report, Global Competitiveness Report 2012-2013 from the World Economic Forum, ranked the Chinese mainland 29th out of 144 economies.