Economic recovery?
Economic Recovery?
With countries racing to recover from the global economic crisis, the results of the latest international survey can only be bad news for the Philippines.
In the 2009-2010 Global Competitiveness Report prepared by the World Economic Forum, 13,000 business leaders ranked the Philippines 87th among 133 economies in terms of competitiveness. The ranking was a major drop for the Philippines, which was rated 71st last year.
Despite repeated assurances by the government that it is addressing corruption, it was still considered the biggest problem in doing business in the Philippines, according to those polled for the annual study. The other top problems, which have long been cited by investors in the Philippines, were an inefficient bureaucracy, inadequate infrastructure and policy instability.
The country ranked low particularly in the quality of its institutions, with low public trust of politicians, favoritism in decisions of government officials, efficiency in the legal framework for settling disputes, diversion of public funds, wasteful government spending and corporate ethical behavior.
This week the World Bank also released a report showing that the Philippines have slipped further in terms of ease in doing business.
From 136th place two years ago, the country slipped to 141st last year and is now ranked 144th among 183 economies. In Asia, the country was ahead only of Cambodia, Timor-Leste and Lao PDR. Similar results emerged in the Global Competitiveness Index, where the Philippines ranked behind even Vietnam, which was at 75th place.
Thailand, whose economy used to be at par with that of the Philippines, ranked an enviable 36th. The co-author of the Doing Business report said the drop did not necessarily mean the business climate in the Philippines had worsened, but that other countries could be doing better.
Regardless of the reason, the country’s slides in ranking in two international studies still showed that the Philippines, for all the rosy economic figures touted by the administration, is falling behind all but a handful of its neighbors.
The studies give an insight into why the Philippines is falling behind its neighbors in attracting job-generating foreign direct investments as well as tourism. Many of the problems cited in study after study are the same and have been raised by investors over the past years. The government has resisted calls for reforms, thinking that it can get away with business as usual. Now we are seeing the results.