Australia needs to up its game when it comes to cloud computing policies, a new study has found.

Australia has ranked six out of 24 leading IT economies in new research from BSA, a big drop from its second place ranking in 2013.

According to the BSA, Australia's ranking is a sign that the legal and regulatory environment for cloud computing in Australia is not keeping pace with cloud innovation.

The 2016 BSA Global Cloud Computing Scorecard ranks the cloud computing readiness of 24 countries that account for 80% of the world's IT markets. Each country is graded on its strengths and weaknesses in seven key policy areas.

“Cloud computing allows anyone - a start-up, an individual consumer, a government or a small business - to quickly and efficiently access technology in a cost-effective way,” the BSA explains.

“These services in turn open the door to unprecedented connectivity, productivity and competitiveness.

This year's results reveal that almost all countries have made healthy improvements in their policy environments since the release of BSA's previous Scorecard in 2013. But the stratification between high-, middle- and lower-achieving country groups has widened, with the middle-ranking countries stagnating even as the high achievers continue to refine their policy environments.

Jared Ragland, senior director of Policy, APAC, at BSA says that while it is encouraging that Australia remains a leader in promoting cloud computing, its slide in the ranking suggests that it must redouble its efforts to keep pace with global leaders in promoting cloud innovation policies.

“Countries around the globe must recognise their policies affect the global cloud marketplace,” Ragland says.

“The report is a wake-up call for all governments to work together to ensure the benefits of the cloud around the globe,” he says.

In terms of overall ranking, the biggest improvers are South Africa (moving up six places) and Canada (moving up five places). The top five countries in the rankings are: Japan, the United States, Germany, Canada and France.

Notably, Thailand, Brazil and Vietnam, despite trailing in the rankings, continue to make significant and consistent gains and are closing their gap with mid-tier countries.

According to the study, the world's major IT markets remained stable with modest gains. Negative trends emerged as well.

For example, few countries are promoting policies of free trade or harmonisation of cloud computing policies.

“Russia and China, in particular, have imposed new policies that will hinder cloud computing by limiting the ability of cloud computing service providers to adequately move data across borders,” Ragland adds.