Johannesburg - South Africa is ranked 53rd in the latest World Economic Forum (WEF) global competitiveness index, overtaking Brazil to take second place among the Brics bloc.
The 2013/14 report, released yesterday, said China was the most competitive of the Brics quintet, in 29th position on the global competitiveness index. Brazil fell eight places to 56th, India was 60th and Russia 64th.
South Africa, which slipped down one place, came first on a number of measures: strength of auditing and reporting standards, efficacy of corporate boards, protection of minority shareholders’ interests, regulation of securities exchanges and a legal rights index.
The country was placed third on its financial markets development and did well on the quality of its institutions, including intellectual property protection, property rights and the efficiency of the legal framework in challenging and settling disputes.
But it performed abysmally on several critical measures. “The health of the workforce is ranked 133rd out of 148 economies – the result of high rates of communicable diseases and poor health indicators more generally. The quality of the educational system is very poor (146th), with low primary and tertiary enrolment rates. Labour market efficiency is poor (116th), hiring and firing practices are extremely rigid (147th), companies cannot set wages flexibly (144th) and significant tensions in labour-employer relations exist (148th).”
The WEF warned: “Raising educational standards and making the labour market more efficient will be critical in view of the country’s high unemployment rate of over 20 percent, with the rate of youth unemployment estimated at close to 50 percent.”
The report sent warning signals to South Africa, Business Unity South Africa (Busa) said yesterday.
“South Africa needs to critically interrogate the causes of this global competitiveness slippage,” Busa said.
The IMD world competitiveness ranking, which came out earlier this year, put South Africa at 53rd out of 60 countries from 50th place last year.
The WEF ranking was led by Switzerland for the fifth year in a row “as a result of its continuing strong performance across the board”. - Business Report