TechInAfrica – According to the Heritage Foundation Index in 2018, South Africa has ranked 77th out of 100 countries in the world and 4th in the African region in terms of the economic freedom with an improved score of 0.7 compared to 2017. Interestingly, South Africa’s ranking is higher than two European countries, Italy (79/180) and Greece (115/180).
The General Manager for research for Brand South Africa, Dr. Petrus de Kock said that the index shows some good insight into the South African economic ecosystems. He further said that the country will need to encourage entrepreneurship and innovation more.
“Notable improvements for South Africa in 2018 include the improvement in the area of investment freedom and judicial effectiveness. The latter is significant coming in a year where the administration of President Ramaphosa made investment a key focal area of its work,” he said.
South Africa’s ranking improvement is caused by the advancement of property rights from 2017 to 2018. The score improved by 0.01(from 67.6 to 67.7). Other areas that also improved are judicial effectiveness (from 59.7 to 65.9); fiscal health (from 70.7 to 75.3); business freedom (from 62.0 to 65.1); labor freedom (from 58.9 to 60.1) and investment freedom (from 40.0 to 50.0).
Speaking about the upward trend in South Africa economy, de Kock said: “We are pleased with the upward trend of the nation’s competitive performance, particularly since 2018 saw a declining global competitiveness of the economy, and South Africa also slipped into a technical recession during the first half of the year which it moved out of after the economy saw a 2.2% rebound in the third quarter. It is, therefore, promising that South Africa, according to the 2018 Index of Economic Freedom, is ‘moderately free’ in terms of its economic activity.
“Economic freedom is about much more than a business environment where business flourishes, it has a far-reaching impact on other aspects such as human development and the power of choice. Consequently, it remains imperative for South Africa to continue safeguarding openness to its market, government size and rule of law.”