MANILA - The Philippine economy has become less competitive globally, weighed down by a slow and corrupt bureaucracy and creaking infrastructure, the World Economic Forum said Wednesday.
The country ranked 57th out of 138 countries in the 2016 to 2017 Global Competitiveness Index, down 10 spots from the previous year. The country slipped in nine out of 12 business “pillars” measured by the world body, according to a WEF statement.
The WEF said an inefficient bureaucracy was the “most problematic” roadblock to doing business in the country, followed by inadequate infrastructure, corruption, tax rates, tax regulations, policy instability and restrictive labor regulations.
The country’s ranking improved in three of 12 “pillars” including the macroeconomic environment, health and education while it slipped in institutions, infrastructure, goods and market efficiency, labor market efficiency, technological market readiness, market size, business sophistication and innovation.
“It shows that we have some challenges remaining and we need to work on those,” National Competitiveness Council co-chairman Guillermo Luz told ANC’s “Market Edge with Cathy Yang.”
Luz said the “disappointing” slide in the country’s rankings also showed that the global economy was becoming more competitive.
President Rodrigo Duterte, who assumed office on June 30, has set a 10-point plan to sustain the pace of one of Asia’s fastest-growing economies. He has also made cracking down on red tape and lowering income tax rates a priority.
However, Duterte’s tough talk against Western critics of his bloody war on drugs has started to unnerve investors. American debt-watcher S&P Global ratings said his sharp rhetoric has diminished the predictability of the country’s economic policy-making and an upgrade of the country’s sovereign ratings in the next two years was unlikely.
Foreign investors were net sellers in the stock market for the 24th straight trading day on Tuesday, the longest selloff since 1999 while the peso slumped to a seven-year low against the dollar.