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Sub-Saharan Africa 'left behind' in economic connectedness - report

May 05 2017 16:38
Liesl Peyper

Durban – Sub-Saharan countries are among the least connected ones in the world, according to the latest Visa Africa Integration Index.

The report measures the economic connectedness of 19 countries looking at trade, movement of foreign capital, data exchanges, information and the flow of people across country borders.

The latest edition of the report was launched on Friday on the sidelines of the World Economic Forum (WEF) on Africa, hosted in Durban.

Adrian Saville, chief strategist at Cannon Asset Managers, Citadel Asset Management and economics professor at the Gordon Institute of Business Science, said sub-Saharan Africa belongs to the “left-behind” category.

One of the authors of the Integration Index report, Saville pointed out that economic connectedness is pivotal to bring about sustained, elevated and inclusive growth.

South Africa scored highest in the index with 79.3, but its score has remained static since the report was introduced four years ago.

Its score is also below the median score of 100 with regard to economic connectedness, together with countries such as the Philippines, Panama, India and Romania.

SA dragged down by expensive data

“What pulls South Africa down,” Saville said, “is regional connectedness and the micro-economic components, such as access to data that is expensive, individual mobility and the movement of people. For example, where is the biometric scanning?”

He pointed out that regional integration is even more important than global integration, as it is a more sustained contributor to socio-economic advance than global integration.

Yet the regional connectedness for sub-Saharan economies lags other areas by a wide margin.

In the report Eastern African countries in particular were highlighted as making strides in improved economic connectedness, including Ethiopia, Kenya, Mauritius, Rwanda and Uganda. However, the biggest improvements were made by Cameroon, Ghana and Zambia.

“There has been a strong correspondence between rising connectedness and improvements in economic and social wellbeing,” Saville said. In this respect, Rwanda has displayed the largest relative gain in connectedness among the 19 countries measured in the index.

This has translated into a gain of 7% per person income per year for Rwandans.

wef  |  wef africa  |  sub-saharan africa  |  africa economy
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