World Competitive Report – South Africa up 4 places, but still Room for Improvement!

Below is an extract from the report (Total of 142 economies included).

“South Africa moves up by four places to attain 50th position this year, remaining the highest-ranked country in sub-Saharan Africa and the second-placed among the BRICS economies. The country benefits from the large size of its economy, particularly by regional standards (it is ranked 25th in the market size pillar). It also does well on measures of the quality of institutions and factor allocation, such as intellectual property protection (30th), property rights (30th), the accountability of its private institutions (3rd), and its goods market efficiency (32nd).

“Particularly impressive is the country’s financial market development (4th), indicating high confidence in South Africa’s financial markets at a time when trust is returning only slowly in many other parts of the world. South Africa also does reasonably well in more complex areas such as business sophistication (38th) and innovation (41st), benefiting from good scientific research institutions (30th) and strong collaboration between universities and the business sector in innovation (26th).

“These combined attributes make South Africa the most competitive economy in the region. However, in order to further enhance its competitiveness the country will need to address some weaknesses. South Africa ranks 95th in labor market efficiency, with rigid hiring and firing practices (139th), a lack of flexibility in wage determination by companies (138th), and significant tensions in labor-employer relations (138th).

“Efforts must also be made to increase the university enrollment rate of only 15 percent, which places the country 97th overall, in order to better develop its innovation potential. In addition, South Africa’s infrastructure, although good by regional standards, requires upgrading (62nd). The poor security situation remains another important obstacle to doing business in South Africa. The business costs of crime and violence (136th) and the sense that the police are unable to provide protection from crime (95th) do not contribute to an environment that fosters competitiveness.

“Another major concern remains the health of the workforce, which is ranked 129th out of 142 economies—the result of high rates of communicable diseases and poor health indicators more generally.”

The full report can be seen at http://reports.weforum.org/global-competitiveness-2011-2012/.