While the United States remains the world's most competitive economy, it risks falling into economic recession like Japan in the 1990s.

The Swiss-based Institute for Management Development has said the US is still number one in its competitiveness survey but risks falling behind Singapore and Hong Kong.

IMD economists say 2008 could be the time when the US falls from its leadership of top competitors.

They have cited the example of Japan's position twenty years ago, when its economy seemed unassailable, just before it slid into a decade of recession.

The IMD says while the US still dominates in economic dynamism, industrial efficiency and innovation, significant challenges are coming up with the structural deficits in the US balance of trade, budget and national debt.

Ten European countries featured among the 55 surveyed, including Switzerland in 4th place, Luxembourg 5th, Sweden 9th, the Netherlands 10th, Norway 11th and Ireland 12th.