We are having a bit of a reunion in Potchefstroom this week with a visit from Prof Wim Naudé. Wim was a Professor in the School of Economics and Director of WorkWell before he went on to the United Nations University WIDER in Helsinki and currently the Maastricht School of Management.
- the importance of manufacturing in the structural transformation of the economy and for economic growth,
- the role that innovation plays, and
- the role of foreign direct investment in technology development.
This draws on a recent book on the Pathways to industrialisation. For example, in an interesting comparison between the BRICS countries he showed the sectoral distribution of FDI – in Brazil, Russia and South Africa foreign investment has been going into resources, in India it is the services sector and in China is is manufacturing.
Wim also explained how all this, in turn, links up with the big questions of the day: skills-biased technological change and inequality. The message for South African policymakers is education and skills are even more important than everyone is saying. We are looking forward to how we will do in the new Global Competitiveness Index out this week!