Philippines drops in global competitiveness ranking

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The Asia Foundation PhilippinesThe Philippines’s competitiveness ranking fell four notches this year as the country still faces challenges in infrastructure, corruption and a high jobless rate, according to International Institute for Management Development (IMD).

In its 2014 World Competitiveness Yearbook, IMD said the Philippines ranked 42nd this year, slipping from from 38th in 2013. In 2012, the Philippines ranked 43rd, making it a net one notch improvement in two years.

Among Asia-Pacific countries, the Philippines dropped to 12th this year from 11th last year.  The country’s ranking was lower compared to Thailand, 27th; Malaysia, 12th; and Indonesia, 37th.

The US topped the list, followed by Switzerland, Singapore, Hong Kong, Sweden, Germany, Canada, United Arab Emirates, Denmark and Norway.

The report ranked 60 countries worldwide on four broad factors, namely economic performance, government efficiency, business efficiency and infrastructure. It uses economic data from various international and national sources, as well as an opinion survey in generating  over 300 criteria to assess and rank the competitiveness of nations.

The Philippines’ economic performance factor dropped six places from 31st to 37th.

“Although GDP growth was 7.2 per cent – the second highest among the surveyed countries – the Philippines was dragged down by its recent modest export performance,” IMD said.

“And although prices remained steady, inflation is relatively higher than many of the other countries in the ranking,” it added.

The Philippines’ government efficiency ranking also dropped – from 31st last year to 40th this year.

The report further said a series of high-profile corruption cases likely contributed to the deterioration in the perception of corruption, and both the Bureaus of Internal Revenue and of Customs (BOC) failed to meet their collection targets.

“Nevertheless, the 32 percent decline in the budget deficit and the 12 per cent increase in national government revenue made up for some of the losses from the perceptions-based criteria.,” IMD said.

The deterioration in the country’s rank this year may have been sharper had it not been for these macro-fiscal policy gains, IMD said.

The country’s business efficiency factor ranking also went down to 27th from 19th, as the stock market cooled down significantly last year after a hot streak in 2012.

“This was not uncommon among many emerging market economies, due in part to the monetary policy of major industrial countries,” IMD said.

The country’s infrastructure ranking is also went down to 59th from 57th, as growing attention on poor roads and transportation facilities was compounded by the slow implementation of the public private partnership (PPP) program.

“A looming power crisis – along with a controversial price hike in late 2013 – also likely contributed to this decline,” IMD said.

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Reading Time: 2 minutes

The Philippines’s competitiveness ranking fell four notches this year as the country still faces challenges in infrastructure, corruption and a high jobless rate, according to International Institute for Management Development (IMD).

Reading Time: 2 minutes

The Asia Foundation PhilippinesThe Philippines’s competitiveness ranking fell four notches this year as the country still faces challenges in infrastructure, corruption and a high jobless rate, according to International Institute for Management Development (IMD).

In its 2014 World Competitiveness Yearbook, IMD said the Philippines ranked 42nd this year, slipping from from 38th in 2013. In 2012, the Philippines ranked 43rd, making it a net one notch improvement in two years.

Among Asia-Pacific countries, the Philippines dropped to 12th this year from 11th last year.  The country’s ranking was lower compared to Thailand, 27th; Malaysia, 12th; and Indonesia, 37th.

The US topped the list, followed by Switzerland, Singapore, Hong Kong, Sweden, Germany, Canada, United Arab Emirates, Denmark and Norway.

The report ranked 60 countries worldwide on four broad factors, namely economic performance, government efficiency, business efficiency and infrastructure. It uses economic data from various international and national sources, as well as an opinion survey in generating  over 300 criteria to assess and rank the competitiveness of nations.

The Philippines’ economic performance factor dropped six places from 31st to 37th.

“Although GDP growth was 7.2 per cent – the second highest among the surveyed countries – the Philippines was dragged down by its recent modest export performance,” IMD said.

“And although prices remained steady, inflation is relatively higher than many of the other countries in the ranking,” it added.

The Philippines’ government efficiency ranking also dropped – from 31st last year to 40th this year.

The report further said a series of high-profile corruption cases likely contributed to the deterioration in the perception of corruption, and both the Bureaus of Internal Revenue and of Customs (BOC) failed to meet their collection targets.

“Nevertheless, the 32 percent decline in the budget deficit and the 12 per cent increase in national government revenue made up for some of the losses from the perceptions-based criteria.,” IMD said.

The deterioration in the country’s rank this year may have been sharper had it not been for these macro-fiscal policy gains, IMD said.

The country’s business efficiency factor ranking also went down to 27th from 19th, as the stock market cooled down significantly last year after a hot streak in 2012.

“This was not uncommon among many emerging market economies, due in part to the monetary policy of major industrial countries,” IMD said.

The country’s infrastructure ranking is also went down to 59th from 57th, as growing attention on poor roads and transportation facilities was compounded by the slow implementation of the public private partnership (PPP) program.

“A looming power crisis – along with a controversial price hike in late 2013 – also likely contributed to this decline,” IMD said.

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