Despite South Africa being the wealthiest country in Africa in 2023 – with the third-strongest passport on the continent – it offers poor economic mobility to its growing private wealth looking for financial stability, offering only 15% access to the global GDP visa-free.
This is according to the Africa Wealth Report 2023, which analysed the passport power and economic mobility of Africa’s wealthiest countries and their citizens – presented by the director of Economic Research and Statistics at the Islamic Development Bank (ISDB) Institute, Dr Areef Suleman.
“More than just a travel document, our passports can define our financial freedoms regarding access to international investment and business opportunities,” said Suleman.
This narrative came to light during the Covid-19 pandemic, which revealed the disparate impacts of global shocks due to country-specific differences.
As a result, cross-country access and mobility are increasingly viewed as an insurance policy against economic and political uncertainties that persist in the current precarious global landscape.
“Consequently, investors and businesspeople are looking for ways to ensure a steady stream of profits and stable consumption in unpredictable times, and economic mobility in terms of visa-free access to more stable and larger economies is one way to achieve this objective,” said Suleman.
To quantify this, the report focused on the Henley Passport Power score. This newly developed term indicates the percentage of global GDP each passport provides to its holders visa-free – and what emerges is an “unequivocal link between passport strength and economic power,” noted Suleman.
This metric combines Henley Passport Index data and the World Bank’s GDP data, ranking all 199 passports according to their power score.
When viewed through this lens, the citizens of Africa’s wealthiest countries have low passport power and poor economic mobility.
Regarding passport power – looking at the number of countries that can be accessed visa-free – Seychelles is ranked on top in Africa, giving its passport holders access to 153 countries.
Mauritius follows this in second and South Africa in third, giving their passport holders access to 146 and 106 countries, respectively, visa-free.
The real power of South Africa’s passport
“Passport holders of Africa’s wealthiest country, South Africa, have access to almost half of the world’s 227 destinations visa-free. While this might sound reasonable, a better measure of mobility for investors lies in their access to the world’s economic output,” said Suleman.
“This is reflected in the Henley Passport Power score, which completely changes the picture,” he added.
The 106 (47%) of the world’s destinations South Africans can access without a prior visa account for only about 15% of the world’s GDP – presenting a very poor economic power for investors residing there.
In contrast, despite its small population size and ranking as the 6th wealthiest country in Africa, Mauritius has access to 146 countries (64.7% of the world) afforded to its passport holders – giving them access to 57.30% of the world’s GDP.
This is especially significant considering that Mauritius contributes a mere 0.01% to the global GDP while South Africa contributes considerably more at 0.45%.
Regarding other African countries, Egyptians can access just 53 countries visa-free, representing nearly a quarter of the globe, but they only have access to a mere 4% of the global GDP.
While the 46 destinations Nigerians can travel to without needing a visa represent 20% of the destinations worldwide, they account for only around 2% of global GDP.
The report shows that when it comes to visa-free access to global economic output, the citizens of African countries and other developing nations with sizable and growing private wealth are at a distinct disadvantage, added Suleman.