Cape Town – South Africa moved up two places in its global competitiveness ranking – from 49th in 2015 to 47th position out of 138 countries.
According to the World Economic Forum (WEF) Index of 2016-17, South Africa performed excellent in the areas of the strength of its auditing and reporting standards, the protection of the shares of minority shareholders and financing through the local equity market where the country ranked first.
South Africa came second with regard to the financial services meeting business needs and obtained a third place in respect of the efficacy of corporate boards and the regulation of securities exchanges.
John Burke, Director of Issuer Regulation at the JSE was heartened by the consistently high ranking South Africa’s financial regulations received in the latest index. “South Africa has proven time and time again that our well-developed and solid institutions are one of our biggest strengths,” he added.
However, in the areas of health and education South Africa fared dismally. It ranked lowest of all 138 countries in respect of the quality of maths and science education, 134th for the entire education system.
As for the incidence of tuberculosis, South Africa ranked 137th (second last) and 135th for the prevalence of HIV among adults.
In the area of labour market efficiency South Africa also received a poor ranking with last place in respect of cooperation in labour-employer relations, and also scored low (135th) in respect of flexibility of wage determination and hiring and firing practices.
Another area for concern is the business costs associated with crime and violence where South Africa scored 133 and life expectancy where the country was ranked 130th.
The report noted that South Africa has been relatively less affected by the fall in commodity prices compared to its regional peers and has shown marginal improvement in aspects of competitiveness.
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“However, a number of shortcomings may limit South African competitiveness going forward,” the report noted.
“Infrastructure development has stalled. Institutional quality has diminished with increased political uncertainty, less transparency, some security concerns and business leaders having less trust in politicians.”
According to the report the slowdown of the Chinese economy and volatility in the rand makes it unlikely for South Africa to decrease its unemployment rate, which in turn will hamper the ability to leverage Africa’s demographic dividend.