Confirming the statement credited to Ngozi Okonjo-Iweala, Nigeria’s Minister of Finance recently that the country’s economy is “strong but with vulnerabilities”, the World Economic Forum on Wednesday ranked Nigeria low in the Global Competitive Index (GCI) 2013 -2014.
Nigeria went down by five slots from the 115th position it occupied last year and presently occupies the 120th position out of the total 148 countries on the list.
The Global Competitive Index, which was introduced in 2004, measures how the set of institutions, policies, and other factors determine the level of productivity of a country. The GCI scores is calculated by drawing together the 12 pillars of competitiveness namely: institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and innovation.
On the preface of the index, the WEF noted that “although we report the results on the 12 pillars of competitiveness separately, it is important to keep in mind that they are not independent and they tend to increase and, in order to sustain this, higher income and labour productivity must improve.”
The ranking places Nigeria in the poorest pool of economic development possible, describing the country as a “factor driven” economy grouped with the likes of Liberia, Laos, Mali and Yemen.
Countries in the best pool of nations are those with innovation-driven economies.
The World Economic Forum found it worrisome that Nigeria’s economy struggles to keep up despite overt advantages over other African countries. For instance, it was noted in the report that because of Nigeria’s population size, the country enjoys a large market size (32nd position) “which has the potential for significant economies of scale and is an important factor for attracting investors.”
The index identified weak institutions on the platform of which Nigeria ranked 129th out of 148 countries, engrained corruption, undue influence, weakly protected property rights, insecurity, which placed it on the 142nd position , poor infrastructure (135th) and poor primary education (146th) as the reasons for the country’s drop on the rating chart .
Nigeria’s overreliance on oil and the poor penetration of ICT were also cited as parts of the factors responsible its poor rating.
Among African countries, Mauritius was ranked as the most competitive country, having overtaken South Africa. Mauritius moved up nine places to occupy the 45th position. Factors responsible for its rating as noted in the report include “transparent public institutions for which it is ranked at the 39th position with clear property rights and strong judicial independence and an efficient government (29th position).”
South Africa occupies the 53rd position while Switzerland, ranked at number one is the most competitive country in the world. Other countries ranked below Switzerland in the top ten are Singapore, Finland, Germany, United States, Sweden, Hong Kong, SAR, Netherlands, Japan and Britain, all retaining their slots from last year.