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Economic growth

South Africa's Competitiveness Crisis: A Leadership Challenge

Strategic Insights

— 1 min read

South Africa's ranking in the IMD World Competitiveness Rankings for 2025 highlights ongoing challenges with governance, infrastructure, and job creation. The country struggles with high unemployment, corruption, and poor government effectiveness. Infrastructure limitations and rising public debt levels exacerbate these challenges. Economist Dawie Roodt and other experts attribute the country's decline to ineffective governance, corruption, and a lack of confidence in the South African government and economy.

Key Takeaways:

  • South Africa ranked 64th out of 69 countries in the IMD World Competitiveness Rankings for 2025, the lowest ranking since 2021.
  • The country struggles with a high unemployment rate, corruption, and poor government effectiveness.
  • Economists Dawie Roodt and Waldo Krugell point to ineffective governance, corruption, and a lack of confidence in the South African government as key reasons for the country's decline.
  • Regulatory reform is critical, according to Krugell, who notes that these reforms can be implemented without increasing taxes or borrowing.
  • Policy uncertainty and the cost of doing business are significant barriers to attracting investment, said Krugell and independent economic analyst Bonke Dumisa.
  • Dumisa emphasized the need for political will and meaningful reform to deliver transparent, inclusive economic growth.
  • DA MP Toby Chance argued that urgent regulatory reform is necessary to address the competitiveness crisis and create jobs.
  • The Organisation for Economic Co-operation and Development (OECD) report found South Africa's regulatory environment to be the most restrictive among surveyed countries.

Statistics:

  • South Africa's ranking in the IMD World Competitiveness Rankings for 2025 is 64th out of 69 countries.
  • The country's unemployment rate is high, with ongoing challenges in job creation.
  • Public debt levels are rising, and the country faces a shrinking fiscal space.
  • Regulatory reforms can be implemented to reduce red tape and add to economic competitiveness.
  • The cost of doing business is a significant barrier to attracting investment, according to Krugell and Dumisa.
  • South Africa's regulatory environment is the most restrictive among surveyed countries, according to the OECD report.

Sources:

  • "South Africa ranked 64th in competitiveness rankings" by News24, citing the IMD World Competitiveness Rankings for 2025.
  • Quotes from economist Dawie Roodt, economics professor Waldo Krugell, independent economic analyst Bonke Dumisa, and DA MP Toby Chance.
  • "Latest report on SA" by the Organisation for Economic Co-operation and Development (OECD).

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