nigeria global competitiveness index institutions (2006 - 2012)
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StatiSense ® - Wale Micaiah ©
Nigeria Global
Competitive Index:
InstitutionsInstitutionsInstitutionsInstitutions2006200620062006----2012201220122012
The World Economic Forum (WEF) Geneva,
Switzerland produces a yearly report to measure
countries and regions competitiveness among
Nations of the world using Global Competitiveness
Index (GCI)
This presentation focuses on Nigeria’s GCI rating
from 2006 – 2012 on the 1111stststst PillarPillarPillarPillar:::: InstitutionInstitutionInstitutionInstitution, for the
purpose of knowing how strong and viable our
Institutions are over a period of 7years as this
would help know where more efforts need to be
applied in order to achieved better growth and
development.
1111stststst Pillar: InstitutionPillar: InstitutionPillar: InstitutionPillar: Institution
The 12 Pillars of GCIThe 12 Pillars of GCIThe 12 Pillars of GCIThe 12 Pillars of GCI
�Institutions� Infrastructure
� Macroeconomic Environment
� Health and Primary Education
� Higher Education & Training
� Goods Market Efficiency
� Labor Market Efficiency
� Financial Market Development
� Technological Readiness
� Market Size
� Business Sophistication
� Innovation
BASIC
REQUIREMENTS
EFFICIENCY
ENHANCERS
INNOVATION &
SOPHISTICATION
FACTORS
The institutional environment is determined by the legal and administrative
framework within which individuals, firms, and governments interact to
generate income and wealth in the economy.
Institution:� Has a strong bearing on competitiveness and growth
� Influences investment decisions and the organization of production
� Helps societies distribute the benefits and bear the costs of development
strategies and policies
The role of institutions goes beyond the legal framework. Government
attitudes toward markets and freedoms and the efficiency of its operations
are also very important:
� excessive bureaucracy and red tape,
� overregulation, corruption, and dishonesty in dealing with public contracts,
� lack of transparency and trustworthiness,
� inability to provide appropriate services for the business sector,
� political dependence of the judicial system,
� improper management of public finances.
In all, 21 indicators were used in measuring the strength of Nigeria’s
institutional economy:
� Property rights, � Intellectual property protection, � Diversion of public funds, � Public trust in politicians, � Irregular payments and bribes, � Judicial independence, � Favoritism in decisions of government officials, � Wastefulness of government spending, � Burden of government regulation, � Efficiency of legal framework in settling disputes, � Efficiency of legal framework in challenging regs., � Transparency of government policymaking, � Gov't services for improved business performance, � Business costs of terrorism, � Business costs of crime and violence, � Organized crime, � Reliability of police services, � Ethical behavior of firms, � Strength of auditing and reporting standards, � Efficacy of corporate boards,� Protection of minority shareholders’ interests, � Strength of investor protection
Each indicator were ranked (based on the number of countries surveyed) and scored from 1-7, 1 being the least.
� Irregular payments and bribes was not
used between 2006 & 2009.
� Efficiency of legal framework in settling
disputes – 2006 & 2008
� Efficiency of legal framework in
challenging regs. – 2006 & 2008
� Gov't services for improved business
performance – 2006 & 2011
Nigeria Ranking & ScoresNigeria Ranking & ScoresNigeria Ranking & ScoresNigeria Ranking & Scores
Effort = 1 – C3/C2
Year Country Count Rank Score Effort
2006-2007 121 87 3.33 28%
2007-2008 131 103 3.33 21%
2008-2009 134 106 3.42 21%
2009-2010 133 102 3.34 23%
2010-2011 139 121 3.18 13%
2011-2012 142 111 3.31 22%
2012-2013 144 117 3.33 19%
This shows a marginal deterioration in Nigeria’s Institutional
systems with the best effort made in 2006. Even though Nigeria has
achieved a score value of 3.33 in 2012 which is same with year
2006, it posit to say, Nigeria has not experienced any growth
Institutionally while other countries have moved far ahead.
Scores, being measured from 1 – 7, with 1 being the worst performance and
7 the best, it is safe to assume that a minimum benchmark should be 3.5 so
as to focus on indicators which are below this value.
The following indicators reflects areas where attention are most need:
Indicators 2006 2007 2008 2009 2010 2011 2012
Institutions 3.33 3.33 3.42 3.34 3.18 3.31 3.33
Intellectual property protection 2.96 2.94 2.94 3.08 2.88 2.78 2.89
Diversion of public funds 2.50 2.40 2.44 2.33 2.23 2.19 2.16
Public trust in politicians 2.11 2.01 1.48 1.57 1.78 1.92 2.23
Irregular payments and bribes 2.91 2.92 2.91
Favoritism in decisions of gov’t officials 2.69 2.43 2.07 2.28 2.38 2.58 2.45
Wastefulness of government spending 2.76 2.71 2.57 2.32 2.02 2.34 2.56
Gov't services for improved business
performance3.22
Reliability of police services 2.60 2.78 2.77 2.88 2.84 3.00 3.25
A closer look at the above shows a downward trend in
the scores of Indicators; Diversion of public funds, Public
trust in politicians, Favoritism in decisions of gov’t
officials and Wastefulness of gov’t spending.
Indicators 2006 2007 2008 2009 2010 2011 2012
Institutions 3.33 3.33 3.42 3.34 3.18 3.31 3.33
Diversion of public funds 2.50 2.40 2.44 2.33 2.23 2.19 2.16
Public trust in politicians 2.11 2.01 1.48 1.57 1.78 1.92 2.23
Irregular payments and bribes 2.91 2.92 2.91
Favoritism in decisions of gov’t officials 2.69 2.43 2.07 2.28 2.38 2.58 2.45
Wastefulness of gov’t spending 2.76 2.71 2.57 2.32 2.02 2.34 2.56
�Diversion of public funds ------- Nigeria ranks 110/144 (2012)
� Public trust in politicians ------- 135/144 (2012)
� Favoritism in decisions of gov’t officials ------- 127/144 (2012)
�Wastefulness of gov’t spending ----- ------- 122/144 (2012)
Public Funds, Politicians,
Gov’t, Wastefulness
It is also important to say that there are marginal
improvements in indicators such as:� Burden of government regulation
� Efficiency of legal framework in settling disputes
� Efficiency of legal framework in challenging regs.
� Transparency of government policymaking
� Efficacy of corporate boards
� Strength of investor protection
� Judicial independence
Nigeria achieved scores of 4.31, 4.11 & 4.36
in Efficacy of corporate boards, Efficiency of
legal framework in settling disputes and
Transparency of government policymaking
respectively.
3.53.3
Average point
2012 score
Institutions – Government, Churches,
IndustriesIndustriesIndustriesIndustries, and the like – have properly
no other function than to contribute to
human freedom; and in so far as they
fail, on the whole, to perform this
function, they are wrong and need
reconstruction.---- Charles Horton CooleyCharles Horton CooleyCharles Horton CooleyCharles Horton Cooley
Evidently, the Nigeria Institutions are not
contributing to the Freedom of Nigerians
and definitely need reconstruction!
2008
20092010
2011
2012
2006
2007
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StatiSense ® - Wale Micaiah ©
Freely share, freely use and freely acknowledge the
source – © Wale Micaiah
Data source:
- The World Economic Forum https://www.weforum.org/
- The Global Competitiveness Index 2012-2013 data platform
Analysis by: WaleWaleWaleWale MicaiahMicaiahMicaiahMicaiah
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