MANILA, Philippines - The Philippines dropped five notches in this year’s edition of an annual survey of countries monitoring financial development, which saw the country fell in terms of financial stability and services.
Despite retaining its score of 3.1 from last year, the country fell to 49th out of 62 nations from 44th on the World Economic Forum’s (WEF) Financial Development Report released this month.
The report, a copy of which was uploaded at WEF’s website, was conducted for the fifth year by the WEF’s Industry Partnership Programme, which grouped together chief and senior executives with academicians and public sector representatives as well as civil society organizations.
It aimed “to identify the factors that play a crucial role in achieving much-needed economic growth” to enable stakeholders to “prioritize, implement, and assess any necessary reforms.”
It used the Financial Development index in rating countries, gauging seven pillars namely institutional environment, business environment, financial stability, banking financial services, non banking financial services, financial markets and financial access.
The Philippines, for this year, fell on five of the seven pillars led by banking financial services, where it plunged to 49th place from 36th last year. This was after its score worsened to just three from 3.4. This segment measures the size, efficiency and information on banks available to people.
The country also fared worse in financial stability sub-index, inching down three notches to 47th from 44th with its score dipping by 0.2 points. The drop was led by a 14-place fall in the currency stability sector to 32nd rank from last year’s 18th “because of the significant weakness in the change in real effective exchange rate.”
The pillar also looked into the health of the banking system (to 54th from 51st) and the risk of developing a sovereign crisis (to 39th from 40th).
The Philippines, on the other hand, retained its 2.7 score on financial services, but fell three rungs to 53rd place this year. It inched down one place in both non-banking financial services (21st) and development of financial markets (34th).
Improvements were, however, noted on the institutional and business environment pillars with Philippine firms seen to have tighter corporate governance.
WEF said the country improved its score by 0.02-point in institutional environment, allowing it to rise three notches to 39th place. Corporate governance, under this segment, posted the best performance to 27th from 34th.
Meanwhile, the Philippines climbed one place in the business environment ranking to 54th with a retained score of 3.4. The country’s infrastructure under this sub-index however fell in the list to 55th from 53rd despite sustaining its 3.4 marking.
Hong Kong continued to top the list for the second straight year, while Venezuela was at the bottom.