SA IT Competitiveness: This is where we fail
The Economist Intelligence Unit recently released its 2009 IT Industry Competitiveness Index which saw South Africa drop six places to number 43 in the world.
The study, now in its third year, assesses and compares the information technology (IT) industry environments of 66 countries, including South Africa, to determine the extent to which they enable IT sector competitiveness.
According to the Economist Intelligence Unit, six factors work together to create a sound environment for the IT sector:
- an ample supply of skilled workers;
- an innovation-friendly culture;
- world-class technology infrastructure;
- a robust legal regime that protects intellectual property;
- a stable, open, and competitive economy;
- and government leadership that strikes the right balance between promoting technology and allowing market forces to work.
Where South Africa fell short
According to the survey broadband networks are a vital factor for IT competitiveness, and the competitiveness gap could widen for countries with slower adoption. “Technology firms demand fast, reliable, and secure Internet access, and the importance of broadband will grow as more IT services and applications are delivered over the Internet,” the survey said.
While South Africa has seen a major growth in this section due to various factors including the construction of the SEACOM cable, it is still lagging far behind the developed world and this remains a poor performing component for the country.
Over the past year South Africa’s IT infrastructure score rose from 8.4 % to 17.8 %, but it is still significantly lower than other components like the Business Environment (74.9 %), Legal Environment (63.5 %) and Support for IT industry development (55.0 %).
South Africa also scored poorly in Human Capital (31.8%) and its R&D environment (13.2 %). This may be partly attributed to a lack of investment in skills development, something which the Economist Intelligence Unit says is a long term imperative.
“Those countries that deliver a combination of IT, business and language skills training will generate a stronger IT workforce. Co-ordinated efforts among governments, universities and IT firms are needed to improve the quality of technology training and expand the pool of potential hires.”
Another ill which South Africa’s government, and especially the ‘previous’ Department of Communications, may well be guilty of is the protection of ‘national champions’. “Protectionism and support for ‘national champions’ will hinder recovery efforts — and longer term sector competitiveness.”
“Governments must strike a balance between support that encourages industry growth and investment, and that which introduces unfair market practices and protectionism that can harm competitiveness,” the Economist Intelligence Unit says.
SA IT Competitiveness – give your views
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