Saturday, October 24, 2020

Global Competitiveness: Botswana crawls up

Botswana has improved its competitiveness score and ranking in the World Economic Forum’s (WEF’s) latest Global Competitiveness Index (GCI), registering significant improvements in most aspects of competitiveness.

The 2016/17 GCI shows the middle income ranked Botswana is ranked at #64 out of 138 countries which is a notable improvement from the previous year where the Country was ranked 71 out of 140 countries.

The Botswana National Productivity Centre (BNPC) which is the local partner of WEF said on Wednesday that the results were worth celebrating as the country has moved seven places up and the improvement comes at a time when Botswana is celebrating its 50 years of independence.

“The good news about this performance is that, Botswana’s competitiveness has improved in almost all the 12 pillars used by WEF to assess competitiveness. A notable improvement is on the Goods Markets Efficiency pillar, jumping from 95th (in 2015) to 73rd in 2016. The report indicates that local competition has intensified and anti-monopoly policy is starting to be effective (jumping from 71 to 63). The degree of Customer Orientation and buyer sophistication has also improved modestly”, BNPC says.

Botswana’s Macro-Economic Environment is still considered among the best in the world ranked in the top 10 countries. In addition Botswana has been doing well in the Institutions pillar for the past six years.

BNPC further stated that beyond 50 years of independence, Botswana has to leverage on technology and innovation in order to enhance business sophistication. A business sophisticated economy tends to be innovative, productive and competitive in nature. Thus private sector involvement and active participation in the development of Botswana is very important.

Recently at the National Business Conference held in Francistown, the outgoing Bank of Botswana Governor Linah Mohohlo said that as the country prepared to celebrate 50 years of independence, the government should ensure that the next stage of economic development was driven by the twin pillars of efficiency and innovation.

“It is the twin pillars of efficiency and innovation that will enable the country to compete at regional and global levels. For we should make no mistake, while the 50th Anniversary of Independence is a great source of national pride, the development of the economy has reached a critical juncture, as indicated by the slowing pace of economic growth, chronic unemployment and mounting pressure on the government budget.

“Effectively addressing these challenges will be key to the successful implementation of the National Development Plan 11 and, looking further ahead, to Vision 2036.

“In this respect, we look forward to advice on, among others, the challenges we face in overcoming the structural limitations to private sector growth and development in Botswana,” Mohohlo said.

She said the country needed to strategise on how to support a sustainable, private sector-led growth in order to create the productive employment opportunities required to support poverty alleviation and foster inclusive economic growth while transitioning into a high-income economy. Among other issues, Mohohlo said there was need for the development of a collaborative public-private sector partnership that would improve the competitiveness of local industries.

“It is just as important to focus on how to boost productivity and job creation, for instance, by moving people from unemployment and under-employment into productive employment. This is fundamental and would impact directly to sustained improvement in living standards of the populace.

“It will also be equally important to consider how best to promote trust between public and private sector entities, since this will be crucial in developing and implementing mutually beneficial public-private partnerships. There is a role for supportive and complementary fiscal, monetary and exchange rate policies. There is also a role for the regulation and supervision of banks and the broader financial sector, in the interest of attaining and maintaining financial stability,” she said.

Further, Mohohlo emphasised the need to watch out for current and prospective global and regional developments that could impact on Botswana. She said although the impact of such global developments as the British vote to leave the European Union (EU) were yet to be felt, the move had created global economic uncertainty that would impact on the pace of economic growth in developing countries.

For the eighth consecutive year, Switzerland ranks as the most competitive economy in the world, narrowly ahead of Singapore and the United States. Following these two is Netherlands and then Germany. The latter has climbed four places in two years. The next two countries, Sweden (6th) and the United Kingdom (7th) both advance three places, with the latter’s Global Competitive Index score being based on pre-Brexit data. The remaining three economies in the top 10 are Japan (8th), Hong Kong SAR (9th) and Finland (10th) all move backwards.

In sub-Saharan Africa, Rwanda is one of the most improved nations moving six places to 52nd. It is closing in on the region’s traditionally most competitive economies, Mauritius and South Africa, although both these countries register more modest improvements, climbing to 45 and 47 respectively. Lower down the rankings, Kenya climbs to 96, Ethiopia holds steady at 109 while Nigeria slips three to 127.

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