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How the world rates South Africa

The world remains in the grips of the economic crisis despite signs of a tentative recovery in 2010 and 2011. The global economy still faces a number of significant challenges that could hamper a genuine upturn, especially in the most advanced economies.

South Africa has held steady in the face of such global economic uncertainty, and is meeting its economic challenges head on. International analysts generally believe that some African countries, including South Africa, are well placed to weather the global storm. South Africa has a large economy and is widely recognised as having solid fundamentals and sound and effective financial systems.

What follows is a round-up of the major international surveys, with a special focus on South Africa's performance.

• Global Competitiveness Index
• Africa competitiveness
• Ease of doing business
• Emerging Markets opportunity index
• Economic freedom
• IT industry competitiveness index
• Corruption perceptions Index
• Press freedom
• Global gender index
• Expat experience
• Cost of living survey

Global Competitiveness Index

South Africa was ranked as the 52nd most competitive country out of 144 surveyed in the 2012/13 World Economic Forum's Global Competitiveness Index, making it the second highest ranked country in Africa after Tunisia (32nd).

It was placed third among the BRICS' economies, with China at 29 and Brazil at 48.

Conducted by the World Economic Forum (WEF) in partnership with leading academics and a global network of research institutes, the index calculates its rankings from publicly available data and a poll of business leaders in 144 economies. The main goal of the report is to evaluate countries' economic environment and their ability to achieve sustained levels of prosperity and growth.

According to the report, South Africa benefits from the relatively large size of its economy, particularly by regional standards, ranking 25th overall for market size.

It also scores well for the quality of its institutions, ranking strongly for strength of auditing and reporting standards (1st), efficacy of corporate boards (1st), protection of minority shareholders' interests (2nd), efficiency of legal framework (17th), intellectual property protection (20th), property rights (26th), and judicial independence (27th).

Particularly impressive, according to the report, is the country's financial market development, for which it ranks 3rd overall, "indicating high confidence in South Africa's financial markets at a time when trust is returning only slowly in many other parts of the world".

Contributing to this assessment was South Africa's high rankings for regulation of securities exchanges (1st), soundness of banks (2nd), availability of financial services (2nd), and financing through the local equity market (3rd).

South Africa also shows up well for business sophistication, ranking 38th overall, and innovation, ranking 42nd overall - benefiting in the latter case from good scientific research institutions (34th) and strong collaboration between universities and the business sector in innovation (30th).

Weaknesses that the country will have to address to further enhance its competitiveness include infrastructure (63) and its labour market effficiency (113th).

Other areas of concern include security and the health of the country's workforce.

• Read more: SA leads African competitiveness
• Download the full report [PDF]

Africa Competitiveness report

South Africa has been rated as one of the continent's top innovators, according to the Africa Competitiveness Report, which reviews the degree of competitiveness of Africa's economies.

Rated as being on a par with innovative countries such as India and Brazil, South Africa is credited as having high-quality scientific research institutions, strong investment in research and development, and a significant level of collaboration between business and universities in research.

South Africa is rated as the second most innovative African country, firmly between with Tunisia in top spot and Senegal.

Based on data collected by the Global Competitiveness Survey, the African Competitiveness Report is compiled by economic and financial specialists from the WEF, the World Bank and the Africa Development Bank. Thirty-five African countries are assessed and ranked.

The report notes that while African economies have made important strides in improving their economies in recent years, more must be done to ensure that the strong growth continues into the future.

• Read more: Unlocking Africa's competitiveness
• Visit the site to browse the report
• Download the full report [PDF]

Doing Business report

South Africa ranks 39th in the World Bank and International Finance Corporation's "Doing Business 2013: Smarter Regulations for Small and Medium-Size Enterprises", an annual survey of the time, cost and hassle involving in doing business in 185 economies around the world.

In the year under review, South Africa was a strong performer when it comes to getting credit (1st), protecting investors (10th) and payment of taxes (32nd).

It was ranked at an impressive 39 for dealing with construction permits, and starting a business in South Africa is also easier (53rd).

While noting recent reforms, one of the country's major weaknesses remains trading across borders (115th). Getting electricity was also weak, at 150.

The Doing Business survey analyses regulations that apply to an economy's businesses during their life cycles, including start-up and operations, trading across borders, paying taxes, and closing a business. It does not, however, measure variables such as security, macroeconomic stability, corruption, skill level, or the strength of financial systems.

• Visit the website: www.doingbusiness.org
• Download the Doing Business 2013report [PDF]

Emerging Markets opportunity index

South Africa has been ranked as the leading emerging economy in Africa and the only country on the continent to be ranked in the top 15 worldwide, according to the Emerging Markets Opportunity Index based on research by international advisory firm Grant Thornton.

The country also ranked ahead of Nigeria as a potential investment destination, coming in at 14 on the index with Nigeria at 17.

The index analayses a variety of indicators from Grant Thornton's International Business Report, the International Monetary Fund and United Nations Human Development Report.

Indicators include economic size, population, growth prospects and levels of development to rate the countries potential to attract business investment.

Overall, South Africa was ranked 14th out of 26 emerging economies, with China, India and Russia claiming the top three spots.

• Read more: SA ranked top African emerging economy
• Visit the website: Grant Thornton SA
• Download the full report [PDF]

Economic freedom

South Africa's economy is regarded as "moderately free", being graded as the 74th freest economy of 177 countries. It is ranked sixth out of 46 countries in sub-Saharan Africa.

The index, published by The Wall Street Journal and US think tank the Heritage Foundation, uses 10 benchmarks to measure the economic success of 179 countries, including business freedom, trade freedom, fiscal freedom, government size, monetary freedom, investment freedom, financial freedom, property rights, freedom from corruption, and labour freedom.

South Africa's economic freedom score is 61.8. and its overall score is slightly higher than the world average of 59.6, and a regional average of 53.7.

• Visit the website: www.heritage.org
• Read the South Africa highlights

IT industry competitiveness index

South Africa ranks 47th out of 66 countries measured in the 2011 IT industry competitiveness index, with a score of 35 out of a possible 100.

The survey ranks the information technology (IT) industry environments of 66 countries on the extent to which they enable a competitive IT sector. The survey is compiled by the Economist Intelligence Unit, the business information arm of The Economist Group, publisher of The Economist.

Titled "Resilience Among Turmoil: Benchmarking IT Industry Competitiveness", the report notes that the IT sector has ridden out the crisis reasonably well, despite reduced technology spending. It highlights the concern that "protectionist instincts are on the rise in many governments' technology sector policies".

South Africa's shift from 37 in 2008 to 43 in 2009 can be contributed to changes in the country's performance as well as to improvements in the sources of data used to measure some indicators, the report says.

According to the study, South Africa performs best in the areas associated with the legal environment, scoring 64.5 out of a possible 100. The country also fares relatively well for its business environment (57.5), support for IT industry development, with a score of 55.2.

However, South Africa's IT infrastructure, with a low score of 17.5, is a key area in need of improvement, primarily through the provision of high-quality networks and greater liberalisation of telecommunications.

• Visit the website: www.globalindex.bsa.org
• Download the full report [PDF]

Corruption Perceptions Index

South Africa is ranked 69th out of 174 countries on Transparency International's Corruption Perceptions Index 2012.

The Corruption Perceptions Index (CPI) measures the perceived level of public-sector corruption in 174 countries and territories. The CPI is a "survey of surveys", based on expert and business surveys. Countries are ranked on a scale of zero (perceived to be highly corrupt) to 100 (perceived as having low levels of corruption).

Although South Africa scored 43, slipping to position 69, Public Protector Thuli Madonsela urged in 2012 that "public accountability was critical for good governance and effective combating of corruption".

Botswana is the top-ranked African state at 37, followed by Cape Verde (39), Mauritius (42), and Rwanda (53).

Denmark, Sweden and New Zealand tied in top spot, each with scores of 90. Fragile, unstable states linger at the bottom of the rankings: Afghanistan, North Korea and Somalia, all scoring 8.

• Visit the website: www.transparency.org

Press freedom

South Africa dropped out of the top 50 in the Reporters Without Borders Press Freedom Index for 2013. While freedom of information is entrenched in the country's Constitution, its ranking has negatively been affected by perceived threats to investigative journalism by the Protection of State Information Bill.

The young African democracy of Ghana moved up impressively to 30, while Mali dropped a dramatic 74 places after a military coup left the country in turmoil.

The annual world press freedom index of 175 countries is compiled from questionnaires completed by hundreds of journalists and media experts around the world. Press freedom is seen as an important tool to inform, expose corruption and abuse of power in governments and to give a voice to minorities and groups facing neglect or discrimination.

Finland, Netherlands, Norway are in the three top spots. In last place, at 175th, is Eritrea, where no independent media is tolerated and as many as 30 journalists are in prison.

• Visit the website: en.rsf.org
• See the full results

Global Gender Gap Index

Comfortably within the top 20 of the Global Gender Gap Index, South Africa maintains the top spot in the region on political empowerment, holding the seventh position on this subindex and the fourth on the women in parliament indicator.

The index, released by the World Economic Forum, ranks 135 countries according to how much they have reduced gender disparities based on economic participation, education, health and political empowerment, while attempting to strip out the effects of a country's overall wealth.

The Global Gender Gap Reports aim to quantify the size of gender-based disparities, tracking their progress over time.

South Africa is the second-highest ranking African country, after Lesotho at 14. the only other African country in the top 20, recognised as having no gap in education and health. Mozambique (23), Burundi (24) and Uganda (28) complete Africa's top five.

Iceland, Finland, Norway, Sweden and Ireland make up the global top five, while Chad, Pakistan and Yemen take the three bottom spots.

• Visit the website: www.wweforum.org
• Download the full report

Expat experience

South Africa is one of the best countries in the world to live in, according to a global survey of more than 5 100 expatriates.

Commissioned by HSBC Bank International, the Expat Explorer survey explores the experiences and perceptions of expats while they work abroad. South Africa was rated as the ninth best country out of 30 to live in, falling in between Germany and Australia.

Expats rated their current locations according to day-to-day criteria, including accommodation, food, social life, healthcare, working hours and family life.

South Africa was rated among the top nations in terms of the ease with which expats integrated into local society, which included lifestyle factors such as making friends with locals, setting up bank accounts, learning the language, and arranging healthcare.

In addition to making the top 10 overall, South Africa scored highly in the categories of organising schools (2nd), work-life balance (3rd) and finding somewhere to live (3rd).

• Visit the interactive website: www.expatexplorer.hsbc.com
• Download the full Expat Experience report [PDF]

Cost of living

Johannesburg has been rated as the most affordable city in the world for foreigners in the Worldwide Cost of Living survey, regarded as the world's most comprehensive study of this type.

Out of 214 cities on five continents, Johannesburg was found to be almost three times cheaper than the most expensive city, Tokyo.

Mercer's survey measures the comparative cost of more than 200 items in each location, including housing, transport, food, clothing, household goods and entertainment.

The weakening of South Africa's currency, the rand, against the dollar is said to be responsible for Johannesburg and Cape Town's position.

The highest ranked - or most expensive - African city is Luanda, Angola (2nd), followed by Ndjamena in Chad (8th) and Libreville in Gabon (20th). There are 20 African cities in the top third of the rankings, pushed there because of the high cost of good, secure accommodation on those cities.

• Visit the website: www.mercer.com

SAinfo reporter

Reviewed: 18 February 2013