The latest report of the influential World Economic Forum’s (WEF’s) Global Competitiveness Index clearly shows the two worlds South Africans live in.
South Africa may have only “slipped” from 53 to a relatively respectable 56 out of 144 ranked countries, and it is the second highest ranked African country. But it suggests that being in the middle is like the average of fire and ice: a pleasant temperature.
On the one side you have the private sector that in several niche areas represents best practice in the world, and on the other a failing government that does not seem to understand how its inefficiency contributes to the inequality in the country.
Lets start with the good news. The WEF report measures more than 110 different indicators covering 12 different pillars, ranging from institutions to innovation. Here are a few good categories in which we scored in the top 15 of 144 countries:
|Strength of auditing and reporting standards||1|
|Regulation of security exchanges||1|
|Protection of minatory shareholders’ interests||2|
|Efficacy of corporate boards||3|
|Financing through the local equity market||3|
|Availability of financial services||6|
|Soundness of banks||6|
|Efficiency of legal framework in challenging regulation||9|
|Strength of investor protection||10|
|Quality of air transport infrastructure||11|
|Effectiveness of anti-monopoly policy||14|
|Efficiency of legal framework in settling disputes||15|
|Effect of taxation on incentives to work||15|
Another good indicator is property rights, which did not make the top 15, but came in at number 20. (The full list is published below)
It is evident that South Africa is on par with world standards within these disciplines. These indicators are also the building blocks of sustainable economic prosperity and exceedingly difficult to create. It is in fact very ironic that South Africa tops the table in auditing and the regulation of securities exchanges, but is stone last in several education related categories.
Now for the bad news. On the other end of the spectrum, let’s look the indicators that rank among the worst 144 positions:
|Quality of math and science education||144|
|Cooperation in labour-employer relations||144|
|Tuberculosis cases/100 000 population||143|
|Hiring and firing practices||143|
|Quality of the education system||140|
|Flexibility of wage determination||139|
|Business impact of tuberculosis||136|
|Business impact of HIV||136|
|Pay and productivity||136|
|Quality of primary education||133|
|Business costs of crime and violence||133|
The recurring theme is blinding. One can only hope that the report will be discussed during the next Cabinet meeting, and that the ministers of education, health and labour would be afforded an opportunity to respond.
The rankings underline just how inefficient our education, health and labour structures are. In fact, the reality is that South Africa has a very poorly educated, sick and lazy workforce. It is also sad that this is not understood by the powers that be.
The cycle of poverty can only be broken by education. There is no other way. At the recent Citadel Inspiration Indaba one of the speakers recounted a wonderful example of a taxi driver in an Asian country boasting that his parents were subsistence farmers, and his son is a nuclear physicist. This must be the ambition of all in the country.
And it is possible. In fact, it shouldn’t be too difficult. Apart from seeing 144/144 for the quality of South Africa’s math and science education, the Cabinet may well look to where other African countries rank. Obviously, all of them ranked higher on the list, but here are a few interesting ones:
|Swaziland||78 (yes, it is correct)|
The first step to success would be to accept that the system is broken – something I do not believe it is yet the case among the policy formulators.
I can still remember how Angie Motshekga, Minister of Basic Education, excitedly announced in January this year that the matric pass rate was 74%. She said this proves that the education system has turned the corner.
She even read out this quotation:
“As President of the USA, Barack Obama once said that through our work we should make sure that the world we leave our children is just a little bit better than the one we inhabit today, and this is what as this government we continue to be committed to.”
The WEF Global Competitiveness Report is a critical benchmark for any country. The latest chapter suggest serious structural problems that if left unaddressed, will lead to much more difficult problems to solve in the future.