The Botswana National Productivity Centre, a partner in the World Economic Forum’s Global Competitive Report, says it is happy with the country’s rankings which had remained stable and praised improvements in its quality score.
The GCR for 2014-2015 showed movement in the quality score while the diamond dependant nation sat at position 74 place out of 114 countries surveyed.
BNPC Executive Director, Baeti Molake, warned at a media briefing this week that, however, a lot needs to be done as the country made gains in only four pillars out of the 12. The country remained stable in its ranking, but made improvements in its quality score from 4.1 last year to 4.2 this year.
“We are happy to say 74 is where we were (last year) and there is an improvement in quality score. We at BNPC are excited about the improvement in quality score and we hope it will improve (more) next year,” Molake said.
Botswana was fourth in the region behind Mauritius (39th), South Africa (56th) and Rwanda at position 62 with the current rankings showing Botswana’s strong performance is on the macro-economic environment.
“This is mainly due to a balanced fiscal budget. The gross national savings as a percentage of Gross Domestic Product (GDP) have significantly increased and the government budget balance as a percentage of GDP has also improved,” stated Molake.
He would not say what direction the country is taking as he sees this as a collective approach that needs different stakeholders.
Botswana remains behind its peers as it is failing to migrate from the factor-driven to an efficiency driven stage of development and it is still categorised ‘as being in the transition stage’ as it was in the previous report.
BNPC said this is partly explained by the continued reliance on primary exports and below-average performance in areas such as goods market efficiency (97th), infrastructure (101st), business sophistication (116th) and innovation (102nd).
“In order to move from factor-driven to an efficiency driven, we should try to make sure we do not rely on primary exports,” said BNPC Information Research Services Manager, Dr Phumzile Thobokwe, adding that 40 percent of exports are minerals.
On the institutions, the country’s quality score went down and raking fell also, but Botswana is ranked 39th for its relatively reliable and transparent institutions. The report reveals that there is efficient government spending, low levels of corruption and an efficient legal framework for settling disputes and challenging regulations in the country.
However there is a decline in the country’s performance for many of the indicators under this pillar yet previously most of the indicators contributed positively towards making Botswana’s Institutions a key competitive strength for the country.
There has been a marked improvement in the labour market efficiency component, ranked 36th from 47th last year. This is mainly due to an improvement in the labour-employer relations, flexibility of wage determination and the country’s capacity to attract talent which has been made easy by adjustments of some immigration regulations.
Improvement in the mobile broadband subscriptions from 16.6 percent to 74.1 percent resulted in a huge improvement in the Technological Readiness Pillar (9th Pillar). This is mainly attributed to the improvement in the quality of data as provided by the relevant authorities.
Despite the above achievements, the country is still categorised as being in the transition stage from factor-driven to an efficiency driven stage of development.
“This is partly explained by the continued reliance on primary exports and below-average performance in areas such as goods market efficiency (97th), infrastructure (101st), business sophistication (116th) and innovation (102nd),” said Molake.
Botswana’s education system presents another area of concern, particularly for a middle-income country in transition to becoming an efficiency-driven economy. Education enrolment rates at all levels remain low by international standards, and the quality of the education system receives mediocre marks.
Yet it is clear that the biggest obstacle facing Botswana, in its efforts to improve its competitiveness, remains its health situation: the country registers one of the highest rates of HIV and one of the lowest life expectancies in the world.
A Poor Work Ethic is still considered the most problematic factor for doing business in Botswana by the business community. However there has been a decline in the percentage of respondents rating poor work ethic as the most problematic factor for doing business (From 20.7 to 18.5 percent).
The data that makes GCR comes from a wide range of sources including institutions like IMF, companies and opinion surveys. The company will normally employ 10 people to be included in sampling.