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The determinants of competitiveness are many and complex. Economists have
long tried to understand what determines the wealth of nations. This attempt has
ranged from Adam Smith¶s focus on specialization and the division of labour to
neoclassical economists¶ emphasis on investment in physical capital and
infrastructure and, more recently, to interest in other mechanisms such as
education and training, technological progress (whether created within the
country or adopted from abroad),macroeconomic stability, good governance,
the rule of law, transparent and well functioning institutions, firm
sophistication, demand conditions, market size, and many others. Each of these
conjectures rests on solid theoretical foundations. The GCI captures this open-
ended dimension by providing a weighted average of many dif ferent
components, each of which reflects one aspect of the complex concept that we
call competitiveness. We group all these components into 12 pillars of
competitiveness:
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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. ? Accommodation in almost all of
Zambia's higher learning institutions has not expanded at the rate at which
student enrolment has, leading to shortages .? Government resources are
overstretched and this is one of the major reasons why it has failed to build
more infrastructures at institutions of higher learning to match the growing
students' population. ?This will significantly address some of the challenges such
as student accommodation that has affected the institution and help UNZA earn
revenues from the business ventures.
.
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Extensive and efficient infrastructure is an essential driver of competitiveness. It
is critical for ensuring the effective functioning of the economy, as it is an
important factor determining the location of economic activity and the kinds of
activities or sectors that can develop in a particular economy. Of Zambia's
66,935 kilometres (41,500 miles) of roads, relatively few are of good quality
and paved except for those routes linking Lusaka to main border posts. The
publicly-owned Zambia Railways (ZR) controls most of the 2,169 kilometres
(1,345 miles) of national rail infrastructure. Rail routes to regional seaports are
very important because Zambia is landlocked. The railway track linking Zambia
to the seaport of Dar es Salaam in Tanzania is jointly run by the Tanzania -
Zambia Railway Authority (TZRA), which is not part of ZR. Other seaports
used for Zambia's imports and exports are Beria in Mozambique, Durban in
South Africa, and Walvis Bay in Namibia. Lusaka International is Zambia's
primary airport; the main secondary airports are based at Ndola, Livingstone,
and Mfuwe. All of these airports are run by the publicly-owned National
Airport Corporation (NAC).? The state-owned Zambia Telecommunications
Company (ZAMTEL) is the national provider of telecommunication services
(predominantly telephone lines). ZAMTEL is planned to be partially privatized.
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A healthy workforce is vital to a country¶s competitiveness and productivity.
Workers who are ill cannot function to their potential and will be less
productive. Over the last decade, Zambia has embarked on a radical
transformation process aimed at creating a well functioning, cost effective and
equitable district-based health care system. Such reforms were in response to
the government's growing awareness of the innumerable health chal lenges
afflicting the nation. These reforms were based on a primary health care
concept, as it was believed that most diseases in Zambia were either preventable
or could be managed at the primary health care level. Thus, primary health care
was chosen as a vehicle through which to deliver health services to the
population. A number of progressive health laws and regulations were devised,
together with the Basic Health Care Package (BHCP).
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Achieving a university education is still the key to status. The first institution of
higher education in the country, the University of Zambia in Lusaka, was
officially opened in 1966, two years after the attainment of Zambian
independence. The second uni versity is the Copper belt University, which was
until 1987 part of the University of Zambia (UNZA). The Zambia Institute of
Technology, which was part of the Department of Technical Education and
Vocational Training (WEVT), is now merged with the Copper belt University.
The former offers courses in agriculture, education, engineering, humanities and
social sciences, law, medicine, mining, natural sciences, and veterinary
medicine, but only business, industrial, and environmental studies are available
at Kitwe. The basic program is four years, although engineering and medical
courses are of five and seven years' duration, respectively. Higher education is
provided by two universities under the aegis of the Ministry of Education and
various specialised institutions (colleges and institutes) controlled by the
Ministry of Science, Technology and Vocational Training. Primary and pre -
primary school teachers are trained at primary school teacher -training colleges
while secondary school teachers are trained in teach er colleges and at the
University of Zambia.
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Market failure occur due to several reasons
3. Ignorance
Given the limited access to education there is considerable lack of knowledge
about the impact of poaching and hunting on the population of many species of
animals. Markets fail where the lack of information means that rational
decisions are not made. If the communities were educated about the impact of
their actions on the level of sustainability then different decisions might be
taken.
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1.01?Property rights 80
1.02 Intellectual property protection 65
1.03 Diversion of public funds 89
1.04 Public trust of politicians 84
1.05 Irregular payments and bribes 81
1.06 Judicial independence 69
1.07 Favouritism in decisions of government officials 59
1.08 Wastefulness of government spending 88
1.09 Burden of government regulation 28
1.10 Efficiency of legal framework in settling disputes 54
1.11 Efficiency of legal framework in challenging regulations 66
1.12 Transparency of government policymaking 47
1.13 Business costs of terrorism 55
1.14 Business costs of crime and violence 87
1.15 Organized crime 64
1.16 Reliability of police services 71
1.17 Ethical behaviour of firms 72
1.18 Strength of auditing and reporting standards 72
1.19 Efficacy of corporate boards 39
1.20 Protection of minority shareholders¶ interests 62
1.21 Strength of investor protection* 59
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2.01 Quality of overall infrastructure 103
2.02 Quality of roads 110
2.03 Quality of railroad infrastructure 84
2.04 Quality of port infrastructure 95
2.05 Quality of air transport infrastructure 111
2.06 Available airline seat kilometres* 109
2.07 Quality of electricity supply 106
2.08 Fixed telephone lines* 131
2.09 Mobile telephone subscriptions* 124
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3.01 Government budget balance* 76
3.02 National savings rate* 62
3.03 Inflation* 131
3.04 Interest rate spread* 127
3.05 Government debt* 35
3.06 Country credit rating* 110
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4.01 Business impact of malaria 132
4.02 Malaria incidence* 127
4.03 Business impact of tuberculosis 136
4.04 Tuberculosis incidence* 131
4.05 Business impact of HIV/AIDS 136
4.06 HIV prevalence* 133
4.07 Infant mortality* 133
4.08 Life expectancy* 137
4.09 Quality of primary education 92
4.10 Primary education enrolment rate* 56
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5.01 Secondary education enrolment rate* 115
5.02 Tertiary education enrolment rate* 134
5.03 Quality of the educational system 52
5.04 Quality of math and science education 77
5.05 Quality of management schools 78
5.06 Internet access in schools 113
5.07 Local availability of research and training services 86
5.08 Extent of staff training 81
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6.01 Intensity of local competition 85
6.02 Extent of market dominance 77
6.03 Effectiveness of anti-monopoly policy 53
6.04 Extent and effect of taxation 79
6.05 Total tax rate* 9
6.06 Number of procedures required to start a business* 34
6.07 Time required to start a business* 65
6.08 Agricultural policy costs 54
6.09 Prevalence of trade barriers 48
6.10 Trade tariffs* 106
6.11 Prevalence of foreign ownership 18
6.12 Business impact of rules on FDI 30
6.13 Burden of customs procedures 71
6.14 Degree of customer orientation 78
6.15 Buyer sophistication 107
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7.01 Cooperation in labour-employer relations 71
7.02 Flexibility of wage determination 91
7.03 Rigidity of employment* 50
7.04 Hiring and firing practices 36
7.05 Redundancy costs* 131
7.06 Pay and productivity 102
7.07 Reliance on professional management 48
7.08 Brain drain 81
7.09 Female participation in labour force* 82
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8.01 Availability of financial services 69
8.02 Affordability of financial services 74
8.03 Financing through local equity market 54
8.04 Ease of access to loans 106
8.05 Venture capital availability 118
8.06 Restriction on capital flows 60
8.07 Soundness of banks 56
8.08 Regulation of securities exchanges 56
8.09 Legal rights index* 6
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9.01 Availability of latest technologies 89
9.02 Firm-level technology absorption 86
9.03 FDI and technology transfer 71
9.04 Internet users* 113
9.05 Broadband Internet subscriptions* 118
9.06 Internet bandwidth*
129
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10.01 Domestic market size index* 114
10.02 Foreign market size index* 110
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11.01 Local supplier quantity
11.02 Local supplier quality
82
98
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11.09 Willingness to delegate authority 66
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12.01 Capacity for innovation 104
12.02 Quality of scientific research institutions
12.03 Company spending on R&D
74
87
12.04 University-industry collaboration in R&D 67
12.05 Government procurement of advanced tech products 72
12.06 Availability of scientists and engineers 88
12.07 Utility patents per million population* 90
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GCI 2009±2010 (out of 133) 112 3.5
GCI 2008±2009 (out of 134) 112 3.5
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1st pillar: Institutions. 65 3.9
2nd pillar: Infrastructure. 118 2.6
3rd pillar: Macroeconomic environment 120 3.6
4th pillar: Health and primary education 128 4.1
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5th pillar: Higher education and training 114 3.2
6th pillar: Goods market efficiency. 65 4.2
7th pillar: Labor market efficiency 107 4.0
8th pillar: Financial market development. 49 4.5
9th pillar: Technological readiness 110 2.9
10th pillar: Market size. 111 2.6
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11th pillar: Business sophistication 90 3.6
12th pillar: Innovation 80 3.0
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Access to financing...........................................................18.8
Corruption.........................................................................14.6
Inadequate supply of infrastructure .................................10.5
Tax rates ...........................................................................8.9
Inefficient government bureaucracy.. ................................8.8
Inflation .............................................................................7.2
Poor work ethic in national labor forc e ............................6.8
Tax regulations .................................................................6.2
Crime and theft .................................................................3.9
Inadequately educated workforce......................................3.8
Policy instability................................................................3.2
Foreign currency regulations.............. ...............................3.2
Poor public health............................... ...............................2.1
Restrictive labour regulations...........................................1.7
Government instability/coups ............ .............................0.4