World Bank Report: SA drops six places
29 October 2014
The World Bank's ‘Doing Business' report for 2015, released in Washington DC this morning, shows that South Africa's economy is heading in the wrong direction under the Zuma administration.
South Africa has dropped by six places in the overall world ranking, from 37th to 43rd. This sharp decline should be a wake up call to the ANC that its economic policies are failing. South Africa is becoming less and less competitive in the world economy and, as a result, a number of other developing economies are pulling ahead of us, including Malaysia (18th), Thailand (26th), Mauritius (28th), Peru (35th), Mexico (39th), and Chile (41st).
In our current position, South Africa is facing the reality of losing our status as the ‘gateway to Africa'. We need a decisive reform in policy now to ensure that we are not left behind by our fast-growing developing world peers.
South Africa dropped in ranking in seven of the ten sub-categories, and did not improve in any. In three sub-categories our score remained unchanged. In the ‘Ease of starting a business' category, South Africa dropped from 55th to 61st place. This ranking reflects the average time it takes to open a new business in South Africa, as well as the high costs and red tape involved. Again, our ranking is behind competitor developing countries.
While the ANC is quick to affirm its support for entrepreneurs, the truth is that it is still far too difficult and lengthy a process to start a business in South Africa.
We are now ranked 158th in the world for "getting electricity" (out of 189 countries), 97th in the world for "registering a property", and 100th in the world for "trading across borders". Continued uncertainty about government economic policy, difficult labour relations, and the possibility of imminent tax increases are all hampering our international competitiveness.
The DA has an economic turnaround strategy that will get back South Africa's competitiveness, reposition us firmly on the continent, and reclaim its attractiveness as an investment destination.
Here are some of the things a DA government would do to stop this decline and turn it around:
Introduce one-stop border posts to expedite border crossings and reduce administrative burdens and costs;
Eliminate out-dated apartheid era exchange controls; and
Cut the time, cost and red-tape required to start a new business.
The DA's top priority is job creation. We know that by making it easier to run a small business, by improving trade with Africa, and by positioning ourselves to attract more investment, we can get South Africa's economy growing again. This will require creating an economic environment in which businesses can grow, not one in which it is becoming more and more difficult to do business.
While the ANC's rhetoric about its "good story" continues, the proof is in the pudding - Its policies and its leadership are the biggest hindrance to job creation and economic growth.
Statement issued by Geordin Hill-Lewis MP, DA Shadow Minister of Trade and Industry, October 29 2014
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