While the survey finds Canada benefits from highly efficient markets, it is being dragged down by the perceived "quality of its research institutions and the government's role in promoting innovation."
The forum ranks a country's competitiveness according to factors such as the state of its infrastructure and its ability to foster innovation.
The Conference Board of Canada, which assisted the forum in the gathering the information, says the country is not "taking full advantage of our strong economic fundamentals."
It notes that Canada has dropped five places in the global rankings since 2009.
The board says more needs to be done and all levels and that government, businesses and educational institutions all have an important role to play.
Switzerland tops the overall rankings of 144 economies in the Global Competitiveness Report 2012-13 for the fourth consecutive year, followed by Singapore.
The forum said Switzerland's standing rests notably on its innovation and labour market efficiency, as well as the sophistication of its business sector.
The United States saw its ranking drop two places to seventh this year, as confidence in the country's politicians continued to decline.
— With files from The Associated Press