South Africa edges up in Global Competitiveness Ranking
South Africa has improved its global competitiveness ranking and business efficiency. This is according to the latest World Competitiveness Yearbook (WCY) by the Swiss based Institute of Management Development (IMD) released today in partnership with Productivity SA. The IMD WCY is an annual report that ranks the international competitiveness of selected countries. The IMD WCY is recognised internationally as the leading Survey of competitiveness between nations.
According to the IMD World Competitiveness Yearbook 2024, South Africa is now ranked 60th out of 67 countries surveyed. Significantly, South Africa improved its business efficiency by six places. SA improved in business efficiency from 54 to 58, infrastructure improved from 62 in 2023 to 60 in 2024 while government efficiency deteriorated from 59 in 2023 to 61 in 2024.
The World Competitiveness rankings are drawn from a combination of Hard data and an Executive Opinion Survey. Productivity SA is the information partner institute for the IMD WCY in South Africa. Productivity SA is an entity of the Department of Employment and Labour and is responsible for employment creation and productivity improvement in South Africa.
The IMD WCY evaluates each country’s data based on about 350 distinct criteria, which are grouped into 4 factors, where South Africa performed as follows among the 67 selected countries:
- Economic performance (61st)
- Government efficiency (61st)
- Business efficiency (48th)
- Infrastructure (60th)
The IMD WCY shows that, in 2024, the following countries topped the global competitiveness rankings:
- Singapore (1st)
- Switzerland (2nd)
- Denmark (3rd)
- Ireland (4th)
- Hong Kong (5th)
The IMD WCY further shows that, in 2024, the following countries BRICS countries performed as follows
- Brazil (62nd)
- Russia ( – th )
- India (39th)
- China (14th)
- South Africa (60th)
According to the IMD WCY, South Africa’s global competitiveness ranking was underpinned by the following challenges:
- High unemployment rates, particularly among the youth.
- Frequent power cuts (load-shedding) disrupting daily life and economic activities.
- Corruption undermining state legitimacy and service delivery.
- High levels of debt, constraining fiscal flexibility.
- Political uncertainty due to the 2024 elections.
The IMD WCY, first published in 1989, is a comprehensive annual report and worldwide reference point on the competitiveness of countries. It provides benchmarking, trends, statistics, and survey data based on extensive research. It analyses and ranks countries according to how they manage their competencies to achieve long-term value creation.
In economic performance, SA ranked high for its terms of trade index and cost of living index but low for its high unemployment rate, especially for youth unemployment and long-term unemployment. In the competitiveness area of government efficiency, SA scored high for effective personal income tax rates and employee social security contribution rate but ranked low in the areas of State ownership enterprises and equal opportunities legislation that encourages economic development.
Despite SA improving its rankings this year, it’s clear that many challenges remain, especially in the light of slow growing economic growth, high unemployment rates as well as low levels of productivity. According to the acting Chief Economist at Productivity SA, Ms Juliet Mashabela, “South Africa needs to focus on sustaining employment growth and expanding training opportunities, addressing sectorial barriers to growth and investment and maintain the infrastructure to grow the economy”
Mashabela also said “an economy’s competitiveness cannot be reduced only to GDP and productivity because enterprises must also cope with political, social and cultural dimensions. Governments therefore need to provide an environment characterised by efficient infrastructures, institutions, and policies that encourage sustainable value creation by enterprises”
Speaking at the virtual release of the results the Senior Economist at the IMD World Competitiveness Centre, Dr José Caballero, said “globally the top economies are dominated by smaller economies – a reflection that economic competitiveness is not a question of size. Singapore is ranked the most competitive economy. Switzerland improved to second position from its 2023 ranking while Denmark has dropped to third position”.
The acting Chairperson of the Productivity SA Board and author of the book “Promoting entrepreneurship in South Africa” Dr Anneline Chetty says productivity, competitiveness and entrepreneurship are a key driver to economic growth in South Africa.
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Author: Maupi Monyemangene from Productivity SA on behalf of Productivity SA.
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