Financial Times

Ghana, Kenya more competitive than Sri Lanka -report
Sri Lanka lags behind in business competitiveness as well as growth competitiveness and is ranked below even very low-income countries like Ghana and Kenya, according to an international report.

The Global Competitiveness Report 2004/2005 released in October - which sheds light on many areas that determine the competitiveness of a country - has cited political instability, restrictive labour regulations, government instability/coups and a corrupt and inefficient bureaucracy as some of the reasons why Sri Lanka is uncompetitive.

The report provides a critical analysis of competitiveness of countries in the world covers 104 countries this year. Despite the negative thoughts, Sri Lanka has moved up in the ranking to 29 from 37.

"This clearly shows, the business sector of the country has moved forward regardless of the poor macro performance of the country, as indicated by being ranked 55 in the Growth competitiveness index," according to a Ceylon Chamber of Commerce (CCC) assessment made on the report.

Sri Lanka is ranked 8th among developing countries that are over performers. India is ranked 1st and Pakistan 5th.

Public institutions are the second pillar of the Growth Competitiveness Index. This section measures the independence of judiciary, legal protection of financial assets and wealth, neutrality of government in bidding for contracts and the cost of crime on business, impact of bribes related to import and export permits, bribes paid in getting connected to public utilities and bribes paid in connection to annual tax payments.

Here, the CCC said, the report doesn't identify any positive areas for Sri Lanka. In the area of competitiveness, Sri Lanka has fared poorly in terms of basic requirements such as macro stability, physical infrastructure and security.

Among efficiency enhancers the weak areas are labour market, human capital, technological readiness, openness and market size. The CCC said Sri Lanka fared slightly better in terms of basic human capital but was poor in terms of advanced human capital. "This is a good indication of the need to change the education system of the country," the CCC said.

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