Ireland has bucked the negative trend this year as the only nation brand in the top 20 to record a positive brand value growth, up 11 per cent to US$670 billion, Brand Finance reports. The strong performance is largely attributable to its forecasts being impacted less than other countries – a major plus given the twin threat of Brexit and Covid-19.
The Irish economy has proven to be particularly resilient, being supported by strong exports and continued consumer spending, said David Haigh, chief executive of Brand Finance. Should the United Kingdom reach a deal on Brexit, Ireland will find itself in an even stronger position as trade disruption with its closest neighbour will be reduced.
“The luck of the Irish is at work yet again, as the nation mitigates the risks and limits the impact of both Covid-19 and Brexit. Backed by a vibrant and resilient economy, Ireland’s strong nation brand reinforces the Emerald Isle’s perception as a preferred investment destination even in times of crisis,” the boss of the brand valuation agency added.
Brands lose US$13.1 trillion
The top 100 most valuable nation brands in the world have suffered a huge loss to their brand value because of the Covid-19 pandemic, amounting to US$13.1 trillion. 2020 has put the world’s nations to the test – from the economic impacts on GDP forecasts, inflation rates and general economic uncertainty, to diminished long term prospects.
Brand Finance estimates that the total brand value of the top 100 nation brands dropped from US$98.0 tn in 2019 to US$84.9tn in 2020, with almost every nation feeling a significant impact of the health crisis on their respective economies. The US and China remain a cut above the rest, claiming first and second position in this year’s ranking.
These two nations recorded brand values of US$23.7tn and US$18.8tn respectively. Relations between the two forerunners remain particularly fragile because of the US-China trade war which consumed both economies over the past few years. Long-standing leader, the US, recorded a 14 per cent brand value loss to US$23.7tn, after yet another turbulent year.
Now home to both the most cases and deaths of the virus globally, the US continues to encounter harsh criticism and questioning globally. With Joe Biden announced as the winner of the 2020 presidential election, in one of the most controversial and polarising races in US history, the country is odds on to chart a new course by pursuing different policies.
Despite the current political uncertainty in the US, American brands’ sheer dominance and success globally will always provide the nation’s economy and reputation with a strong safety net. American brands – Amazon, Google, Apple, and Microsoft – managed to claim four out of the top five spots in the year’s Brand Finance Global 500.
Top 10 down 14 per cent
With the pandemic wreaking havoc on nation brand values across the world, the top 10 has recorded a brand value loss of 14 per cent on average. Japan fared relatively better than its counterparts, recording a modest six per cent brand value loss to US$4.3tn, and inching up to claim third spot in the ranking, helped by the low number of Covid-19 deaths.
The UK remains fifth, after a 14 per cent brand value decrease to US$3.3tn. Despite Brexit being forced into the shadow of Covid-19 this year, the uncertainty surrounding the outcome has persisted. The UK government are still engaged in negotiations with the EU, with fishing rights and competition rules as the two main sticking points for both sides.
Vietnam was the fastest-growing nation brand, its value up by 29 per cent to US$319bn. Recent trade deals with the EU reinforce the nation’s growth. In stark contrast, Argentina recorded the biggest drop in brand value, down 57 per cent to US$175bn. With Covid-19 cases passing the million mark, Argentina has struggled to respond well to the outbreak.
Germany strongest nation
As well as measuring nation brand value, Brand Finance also determines the relative strength of nation brands through a balanced scorecard of metrics evaluating brand investment, brand equity and brand performance. For the first time this year, the methodology reports the results of the Global Soft Power Index – a study on nation brand perceptions.
Based on opinions of around 55,000 people in over 100 markets, Germany is the world’s strongest nation brand with a brand strength score of 84.9 out of 100 and a corresponding AAA rating. Angela Merkel’s long tenure as Chancellor has provided a stable presence against the backdrop of unstable and erratic counterparts, the report concludes.
