MANILA, Philippines (2nd UPDATE) – The Philippines improved by seven notches to 52nd place from last year's 59th place in the global competitiveness ranking, according to the World Economic Forum (WEF).
The WEF’s Global Competitiveness Report 2014-2015 released on Wednesday cited reforms implemented by the Aquino administration for the improvement.
“The country's gain of 33 places since 2010 is the largest over that period among all countries studied. The results suggest that the reforms of the past 4 years have bolstered the country’s economic fundamentals," WEF said.
The global competitive index measures the competitiveness of 144 economies based on over 100 factors grouped into 12 pillars.
"The trends across most of the 12 pillars are positive, and in some cases truly remarkable,” the report said.
The Philippines posted strongest results in the institutions, innovation, goods market efficiency, and macroeconomic environment categories.
"In particular, there are signs that the efforts made against corruption have started bearing fruit: in terms of ethics and corruption, the country has moved from 135th in 2010 to 81st this year. The recent success of the government in tackling some of the most pressing structural issues provides evidence that bold reforms can yield positive results relatively quickly," the report said.
However, the country continues to rank poorly in infrastructure, especially with respect to airport and seaport infrastructure.
The Philippines also remains weak in the labor market, which the report said "suffers from rigidities and inefficiencies."
“The Philippines ranks a mediocre 91st in this dimension and almost no progress has been made since 2010,” said WEF.
Security, particularly in terms of costs that the threat of terrorism imposes on business, also remains as an issue in the country, according to the report.
Makati Business Club executive director Peter Perfecto urged government and the private sector to discuss ways to improve security as this may be one of the hindrances in improving the country's business environment.
“We have had no improvement in security. Maybe the police would like to start the dialogue with the business community and MBC because we can look at ways in which we can pull up those numbers,” said Perfecto, who led the Philippine launch of the report on Wednesday.
Perfecto said the Philippines is in a position to further improve its ranking, but political distractions and issues surrounding the port congestion, rising prices and power situation should be addressed immediately.
“I think if government loses sight of the very important reform measures that they have started and still have to finish then that could become a threat that could easily slide us back down. When you’re dealing with situations where the elections are being discussed, there are impeachment issues, and you can’t move on from those issues, then you could have a problem. So let’s stay focused,” Perfecto said.
“The opportunity to reach the upper third next year is at risk. So we have to address quickly, and prioritize these issues so that we can continue this trend,” he added.
5th in Asia
The Philippines placed fifth in terms of competitiveness among nine Southeast Asian countries included in the report, ahead of Vietnam, Lao People’s Democratic Republic, Cambodia and Myanmar.
Leading Southeast Asia in competitiveness are Singapore, Malaysia, Thailand and Indonesia.
The Philippines’ seven-notch jump is the biggest improvement among ASEAN nations, followed by Thailand’s improvement to 31st from 37th last year.
No data was available for Brunei in the 2014 report.
Switzerland again was ranked first for the sixth year in a row. It was followed by Singapore, the United States, Finland, and Germany.
Rounding out the top 10 most competitive countries based on the index are Japan, Hong Kong, Netherlands, the United Kingdom, and Sweden.
Only 144 economies were ranked in 2014, compared to the 148 last year.