A logo of the World Economic Forum Annual Meeting 2013 is pictured at the Swiss resort of Davos in January 2013.
The World Economic Forum’s Global Competitiveness Report 2014-2015 released this morning, ranks South Africa at 56 out of 144 countries. Last year, South Africa came in at 53 out of 148 countries.
Switzerland, Singapore and the United States occupy the top three positions. Yemen, Chad and Guinea hold the bottom three.
This influential report, compiled by the Davos-based think tank, ranks countries according to their competitiveness. Rankings are based on data collected from bodies such as the United Nations, World Bank and national statistics offices. This is complemented by a survey conducted by WEF amongst business executives.
The World Economic Forum defines competitiveness as the “institutions, policies, and factors that determine the level of productivity of a country”.
Countries are assessed according to twelve pillars of competitiveness: institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and innovation.
Mauritius was ranked as the most competitive economy in sub-Saharan African, coming in at 39, up from 45 last year.
China leads the BRICS nations at 28, followed by Russia (53), South Africa (56), Brazil (57) and India (71), according to the World Economic Forum&39;s ranking.
South Africa comes in at 36 for its institutions. The highest rankings under this pillar are for the sub-components related to property rights (20) and intellectual property protection (22). However, when it comes to the business costs of crime and violence (133), regulatory burden (120), the public’s trust in politicians (90) and the diversion of public funds (96), the country ranks poorly.
South Africa falls from third place to seventh on financial development. It retains the top spot in the world on the sub-component for the regulation of securities exchanges. Somewhat lower rankings are obtained for ease of access to loans (32) and availability of venture capital (37).
This can be contrasted with financing through the local equity market, where the country is far ahead of others at the third spot. On soundness, South African banks come in at number six.
Though this is a relatively small economy, with a growing trade deficit, South Africa is ranked at 25 for market size. This is driven by the domestic market size (24), whereas on its foreign market size (value of exports) it is ranked at 34.
China leads the BRICS nations at 28, followed by Russia (53), South Africa (56), Brazil (57) and India (71), according to the World Economic Forum&39;s ranking.
Business sophistication is quite advanced, at 31. On the nature of its competitive advantage, the country comes in at 62. This measures the sources of a country’s advantage, on a spectrum from natural resources to unique products.
Goods markets are considered fairly efficient, at 32. The effectiveness of anti-monopoly policy (competition regulation) is strong (14), but no longer in the top 10 as it was last year (8).
The macro-economic environment is placed at 89, up from 95 last year, but still a far cry from 69 in the 2012/2013 period.
The picture remains dire when it comes to the labour market. In last year’s report, the country came in last on labour-employer relations and second last for rigid hiring and firing practices. This remains so this year, at 144 and 143 respectively. Taxation did not have a negative impact on incentives to work, with the country ranked at 15 on this measure.
The country is above average when it comes to technological readiness (66), though internet bandwidth lags (126).
On infrastructure, the country comes in at 60. The sub-component of electricity supply however is much lower than that at 90.
South Africa comes in close to the bottom when it comes to its health and education, at 132. When looking at some of the sub-components under this pillar, the incidence for tuberculosis (143), HIV prevalence (140) and the quality of primary education (133) are notable weaknesses.
For higher education and training, the country comes in at 86. The country does well on staff training (18) and its management schools (24), but is close to the bottom when it comes to the quality of maths and science education, where it comes in last at 144.
The country, despite its education rankings, is considered fairly innovative at 43. On the positive side, its capacity to innovate (35) and the quality of its scientific research institutions (34) rank high, whereas government’s procurement of advanced technology products is ranked at 112.
- eNCA
