jump to navigation

Ethiopia (Sub-Saharan Africa) and the Global Competitiveness Report for 2014-2015 September 6, 2014

Posted by OromianEconomist in Uncategorized.
Tags: , , , ,
1 comment so far

OEthiopia Least competetive GCI 002  

“Strong institutions, available talent, and a high capacity to innovate hold the key for the success of any economy. These elements will continue to be even more essential in the future.”

-GCI Report 2014-2015  

“What Africa needs are strong Institutions Not Strong men.” -US President Barack Obama in Accra on his maiden visit to Africa as President .


“There is a monstrous relationship between the government and the citizen whereby the government is more powerful than the citizen” –  Rev. Fr. Anthony Adewale, Prof. of Philosophy and Theology Dominican Institute in the Guardian of Sep 9, 2012.  



“In the absence of institutions, strong men dominate, and the effect of their dominance is weakened rule of law and elevated uncertainty levels. Institutions have and follow rules, strong men have friends and follow whims. The outcome from one is calculable probability of outcomes; from the other uncertainty. Uncertainty makes decision making problematic and often results in either the avoidance of economic engagement or the high cost of hedging against undesired outcomes. These high transaction costs translate to uncompetitiveness for the economy. Even more troubling, high uncertainty which results in poor economic performance can create a class of people who are so left out they feel they have nothing to lose. With no stake in the social order they turned to conduct that more or less usher in anarchy, what Robert Kaplan quotes a Sierra Leonean Minister in The coming anarchy as dubbing ‘the revenge of the poor’.”  – Pat Utomi  




Ethiopia ranks  118th/ 144 in this year Global Competitiveness Index (GCI). The report says the country  ‘facing challenges across all pillars despite its recent record growth rates. The functioning of its institutions (96th) receives a weaker assessment across almost all indicators, including property rights, ethics and corruption, and government efficiency. Furthermore, the country’s goods market (124th) remains inefficient. Ethiopia also requires significant improvements in the areas of infrastructure (125th), higher education and training (131st), and technological readiness (133rd). On a more positive note, this year points to a slight improvement in the country’s labor market, although concerns about the quality of labor-employer relations (97th), hiring and firing practices (78th), and the alignment between pay and productivity (99th) remain. Primary education, with a net enrollment rate of 86 percent, is comparatively good (although the quality of primary education requires improvement), and women account for a high percentage of the country’s labor force.’

According to the report,  more than half of the 20 lowest ranked countries in the GCI are sub-Saharan Africa, and overall the region continues to under perform in many areas of the basic requirements of competitiveness: the infrastructure deficit remains profound, and despite gradual improvements in recent years, health and basic education remains low. Only a handful of sub-Saharan economies—the island states of Mauritius and Seychelles, in addition to Cape Verde—have noteworthy health and education systems. Higher education and training also need to be further developed to provide the skills required for higher-value-added growth. The region’s poor performance across all basic requirements for competitiveness stands in contrast to its comparatively stronger performance in market efficiency, where several of the region’s middle-income economies fare relatively well. Although large regional variations remain in terms of competitiveness—ranging from Mauritius, now a solid 17 places ahead of the second-ranked South Africa, to the lowest ranked Guinea at 144th—efforts to strengthen the very basic requirements for long-term growth will be crucial for sustaining economic growth and making it more inclusive. These efforts will need to emphasize closing the infrastructure deficit and providing the region’s (young) population with the necessary skills to carry out higher-value-added employment. Globally, Switzerland holds the number one spot, followed by Singapore and the United States. Finland and Germany both fell one notch, to the 4th and 5th. In this case, the top of the rankings continues to be dominated by highly advanced Western economies and several Asian tigers. For the sixth consecutive year Switzerland leads the top 10, and again this year Singapore ranks as the second-most competitive economy in the world. Overall, the rankings at the top have remained rather stable, although it is worth noting the significant progress made by the United States, which climbs to 3rd place this year, and Japan, which rises three ranks to 6th position. Brics economies presented a mixed performance, and China (28th, one place up compared to last year) leading the group ahead of Russia (53rd), South Africa (56th), Brazil (57th) and India (71st). The Global Competitiveness Report 2014-2015 assesses the competitiveness of landscape of 144 economies, providing insight into the drivers of their productivity and prosperity. The report series remains the most comprehensive assessment of national competitiveness worldwide. Read the full report @ http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2014-15.pdf  

Report reveals sub-Saharan Africa’s 10 most competitive economies