South Africa’s Economic Competitiveness Regains Momentum Boosted By Financial Sector
South Africa has risen 7 places to rank position 60 globally in the World Economic Forum Competitive Report 2019.
Based on the just-released report, South Africa is the second most competitive in Africa after Mauritius which has a global score of 64.3 and ranks 52.
The Global Competitiveness Index identifies and assesses the factors that underpin the process of economic growth and human development
The score of each country is based on 12 key pillars of competitiveness.
They include ICT adoption, institutions, health, infrastructure, financial system, macroeconomic stability, skills, product market, labor market, market size, business dynamism, and innovation capability.
The report noted that the Cyril Ramaphsa-led country gained momentum after the recent political shift.
The report which is released on an annual basis highlighted that South Africa is the regional financial hub with properly established equity insurance and credit markets. The financial sector as a whole was rated the 19th most competitive globally.
“South Africa has also developed one of the most advanced transport infrastructures in the region and is among the top countries in Africa for market size,” a part of the report read.
Generally, health conditions improved since the last assessment adding 3.3 years to the average healthy life expectancy.
“Institutional quality has also improved (+3.3 points, 55th) but unevenly. Some aspects of this category have achieved remarkable progress, including the restored balance of powers across different state entities (+7.7 points, 16th), enhanced administrative efficiency of the public sector (+6.3, 39th) and corporate governance (+3.3, 26th).”
While the Southern African country’s competitiveness is progressing, some sectors are performing poorly, derailing its general performance.
One such sector being security where the country was named position 135. It is no doubt that one of the major challenges facing SA is insecurity as the country has previously been named one of the unsafest in the world.
In transparency, South Africa ranked position 62 and with government adaptability to change it was ranked at position 100th.
“Further, South Africa’s competitiveness is being held back by relatively low business dynamism (61.9, 60th), which is inhibited by insolvency regulation and administrative burdens to start a business, and a persistently insufficient labour market flexibility (52.1, 111th).”
The report pointed out the need for structural reforms necessary to re-ignite the economy and further provide better opportunities to the majority of South Africans.
Featured Image Courtesy: Adriaan Louw
