Institutional Quality and Economic Policy Strategies as Drivers of Competitiveness in African Economies
Institutional Quality and Economic Policy Strategies as Drivers of Competitiveness in African Economies

Summary/Abstract: This study examines the determinants of national competitiveness in African economies, with a particular focus on the role of institutional quality and economic policy strategies. The analysis is based on cross-sectional data for 2024 covering fifteen African countries and includes governance, competitiveness, and socio-economic indicators such as the Ibrahim Index of African Governance (IIAG), Corruption Perceptions Index (CPI), IMD Competitiveness Score, GDP per capita, Human Development Index (HDI), and inflation rate. Principal Component Analysis (PCA) and K-means cluster analysis were applied to identify structural relationships and country groupings. The results reveal a strong positive association between institutional quality and economic competitiveness, indicating that countries with stronger governance frameworks tend to achieve higher competitiveness levels. The cluster analysis identified three distinct groups of countries with differing institutional and development profiles. Countries characterized by higher governance quality, lower corruption, and stronger socio-economic performance demonstrate significantly higher competitiveness, while countries with weaker institutional frameworks face greater structural constraints. These findings confirm that institutional quality is a key determinant of competitiveness and highlight the importance of context-specific policy strategies. Strengthening governance effectiveness, improving institutional capacity, and supporting socio-economic development are essential for enhancing competitiveness and promoting sustainable economic growth in African economies.

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