HARARE - Poor international perception of Zimbabwe’s public institutions continues to weigh the country down, the World Economic Forum (WEF) has said.
According to the latest WEF Global Competitiveness Report 2013–2014, public institutions continue to receive a weak assessment, particularly related to corruption, security, and government favouritism, although overall the assessment of this pillar has improved somewhat since a few years ago.
“Yet major concerns remain with regard to the protection of property rights), where Zimbabwe is among the lowest-ranked countries at 137, reducing the incentive for businesses to invest,” said WEF.
In the latest survey released on Wednesday, Zimbabwe marginally moved up one position to 131 out of 148 countries.
The WEF said the country, whose economic growth is currently premised on the Medium Term Plan, still required more efforts to ensure its macroeconomic stability.
“Despite efforts to improve its macroeconomic environment — including the dollarisation of its economy in early 2009, which brought down inflation and interest rates — Zimbabwe still receives a low rank in this pillar (114th), demonstrating the extent of efforts still needed,” the survey noted.
Zimbabwe was also found to have weaknesses in areas of health ranked at 132 in the health sub-pillar, low education enrolment rates, and formal markets that continue to function with difficulty, particularly with regard to goods and labour markets, ranked 130th and 140th, respectively.
The WEF Index is a tool that assesses the competitiveness of 148 economies across all geographies and stages of development.
It aims to capture the complexity of the phenomenon of national competitiveness, which can be improved only through an array of efforts in different areas that affect the longer-term productivity of a country, which is the key factor affecting economic growth performance of economies.
Zimbabwe’s neighbour South Africa was ranked 53 out of 148 countries surveyed on the World Economic Forum’s Global Competitive Index.
South Africa ranked ahead of all its Brics partners except China, who remained in 29th position, taking over second place from Brazil, who is now ranked third in 56th place, followed by India in 60th place and Russia at 64.
It took second placing in Africa behind Mauritius, who climbed nine places to 45th position. Behind South Africa was Rwanda (66th), Botswana (74th), Morocco (77th) and Nambia (90th).
The top 10, in order, are: Switzerland, Singapore, Finland, Germany, the United States, Sweden, Hong Kong, the Netherlands, Japan and the United Kingdom.
South Africa scored highly on the quality of its institutions, ranking 41st overall and ranked first for the regulation of securities exchanges for the fourth consecutive year.
Director of issuer regulation for the Johannesburg Stock Exchange John Burke said: “We are very pleased with this accolade for South Africa, which indicates that the JSE is a secure and credible environment to raise capital and in which to invest.”
South Africa was also ranked first for strength of auditing and reporting standards; efficacy of corporate boards and the protection of minority shareholders’ interests. It took third place for financial market development.
South Africa performed badly with regards to its hiring and firing practices (147th ), its labour-employer relations (148th place) and education system (146th), no doubt encouraged by the ongoing labour issues in the mining sector.
The report said, “The country’s strong ties to advanced economies, notably the euro area, make it more vulnerable to their economic slowdown and likely have contributed to the deterioration of fiscal indicators: its performance in the macroeconomic environment has dropped sharply (from 69th to 95th place).”
Released annually in September, the report rates countries on competitiveness in terms of quality of infrastructure and institutions, efficiency, market sophistication as well as capacity for innovation amongst others. — With BusinessDay