Philippines gains in 2010 global competitiveness list, but...


Posted at May 20 2010 12:10 AM | Updated as of May 20 2010 06:07 PM

MANILA, Philippines - Much still has to be done to improve the Philippines’ competitiveness even as the country rose 4 notches in the latest edition of an annual global ranking.

While 39th in the Institute for Management Development (IMD)’s 2010 list of 58 economies was the Philippines’ best performance since its inclusion over a decade ago, the result was still short of the top third placing local authorities claimed could be achieved by 2010.

A 5-notch gain to 40th place in 2008 had spurred optimism among the National Competitiveness Council (NCC) and the IMD’s local partner, the Asian Institute of Management, which said at that time the Philippines should rank 18th or 19th by 2010.

The country, however, slipped 3 notches to 43rd in 2009.

Officials commenting on the latest report said that with a new government set to take office in a little over month, the focus should be on improving governance, reducing the bureaucracy, building infrastructure, and supporting exporters.

In this year’s edition of the IMD’s World Competitiveness Yearbook, the Philippines improved its score by more than 2 points to 56.526 from 54.49 last year, mostly due to improvements in the economy and government efficiency.

The highest ranked country, Singapore, received a perfect score of 100.

Of the 4 indicators monitored, the Philippines improved in terms of economic performance (to 34 from 51) and government efficiency (31 from 42).

A lack of progress in business efficiency and infrastructure, however, kept the Philippines at 32nd and 56th place, respectively.

While still in the bottom third, the Philippines surpassed countries like Italy, Greece, and Russia. It, however, still lagged peers in the Asia-Pacific region, at the bottom in 13th place.

The Philippines, according to the IMD, faces the following challenges:

- applying the rule of law and restoring faith in public institutions;
- ensuring food and energy security;
- planning for natural disasters and climate change;
- providing entrepreneurial opportunities, jobs, skills training and education in the countryside;
- addressing migration into cities and configuring urban areas appropriately

Ambassador Cesar B. Bautista, NCC co-chairman, said in a phone interview that "the next administration should focus on improving governance to ensure that the program aimed at improving the country’s global competitiveness -- which is mainly generating more employment and reducing poverty in line with the Millennium Development Goals -- are implemented efficiently."

Mr. Bautista, who is to speak today at the report’s launch, stressed the need to improve transparency and reduce the bureaucracy. He added that in terms of infrastructure, the government should ensure that it is designed for competitiveness.

"It is not how many ... we are actually building that matters but on how are we going to plan together to design infrastructure for competitiveness," he said, adding that more of the focus should be on transportation.

"It must be noted that improving the country’s competitiveness is not only a government’s responsibility," Mr. Bautista said.

With respect to business efficiency, Philippine Chamber of Commerce and Industry Chairman Emeritus Donald G. Dee said more effort must be seen in simplifying registration and licensing.

"Other local government units should follow the simplified registration and licensing procedures of cities like Marikina, Mandaluyong, Quezon City and Manila to attract more investors," he said.

The 4 cities were identified by the World Bank’s International Financial Corp. early this year as models in simplifying business registration by substantially cutting the average 18 stages to 2 -- filing and payment.

Federation of Filipino-Chinese Chamber of Commerce and Industry, Inc. Vice President Alfonso G. Siy, meanwhile, urged the government to support the local export industry.