17 October 2018
by MOUTIOU ADJIBI NOUROU
(Ecofin Agency) – Today 17 October 2018, the World Economic Forum (WEF) published its 2018 global competitiveness report. While the world ranking is dominated by the US, the main observation about Africa is that it is over-represented in the lower classes of this ranking.
Subsahara: last in the ranking
On examination of the data provided by the WEF, it appears that African economies are really less competitive, this is especially true for Subsahara.
While the world average is 60 (showing that no country can be fully competitive), in Subsahara, it is 45.2 over 100. Apart from showing the region as the last in the ranking, this score demonstrates that it does not even reach the minimum which is 50 over 100.
This regional performance echoes on national economies in Africa. According to the figures, 18 out of the 21 countries that had a score below 50 were from Subsahara. Seventeen out of the 34 Subsaharan economies ranked in the report are among the 20 less performing in the world.
While no African countries are in the top 10 of the most performing countries, eight Subsaharan countries are among the ten less competitive countries.
Let’s note that only two countries in the continent (Mauritius and South Africa) have above-average scores (63.7 and 60.8) and Chad (140th out of 140) has the lowest score both in Africa and in the World with 35.5.
Looking at the performance on a subregional level, we notice that despite the subregion’s poor performance, some of the economies in the region are more competitive than others. On a subregional level, Southern Africa comes first with a score of 48, followed by East Africa 46.8 and West Africa 44.5.
Weak public institutions and policies
According to the authors of the report, these lower scores of African economies is due to the weakness of the public institutions and inadequate public policies. This explains the reason why Subsahara has the lowest score in 10 out of the 12 composites of the competitiveness report (composites that belong to four categories namely economic environment, human capital, market, and innovation ecosystem).
Administrative complexity, inadequate public policies and challenge of countries in the continent to fill the technology gap justifies the poor score of African economies despite strong economic growth.
Sixteen African countries were not considered in the report. They are namely, Guinea-Bissau, Niger, Congo, Eritrea, Lybia, Somalia, Sudan, South Sudan, Madagascar, Equatorial Guinea, Togo, Central Africa, Gabon, Sao Tomé & Principe, Djibouti, and Comoros.
The global competitiveness index measures the competitivity of national economies. It is based on 12 indicators that are institutions, infrastructures, technology adoption, macroeconomic stability, health, expertise, production market, labor market, financial systems, market size, trade dynamism, and innovation capacity.