RP improves rank in Competitiveness Index
MANILA, Philippines - After the global economic crisis, the ranking of the Philippines in the 2010-2011 Global Competitiveness Index (GCI) released by the World Economic Forum (WEF) improved by two notches to 85th out of 139 countries.
The WEF said the Philippines improved its ranking and score to 4; it was ranked 87th in the 2009-2010 with a score of 3.9.
The report said, however, that the country’s ranking last year and this year was still significantly lower than its ranking in 2008, at 71st and with a score of 4.1.
The 2010-2011 GCI saw the entry of six new countries in the Index and the removal of Suriname, which was included in last year’s survey. The six new ones are four African countries—Angola, Cape Verde, Rwanda and Swaziland—and two from the Middle East, Iran and Lebanon.
“The concept of competitiveness, thus, involves static and dynamic components:
although the productivity of a country clearly determines its ability to sustain a high level of income, it is also one of the central determinants of the returns to investment, which is one of the key factors explaining an economy’s growth potential,” the report stated.
The GCI is based on three main categories and 12 pillars of competitiveness, which allows the GCI to provide a comprehensive picture of the competitiveness landscape in countries around the world at all stages of development.
In first category, Basic Requirements, the Philippines was ranked 99th with a score of 4. The four pillars under this category are institutions, infrastructure, macroeconomic stability, health and primary education, where the country was ranked 125th, 104th, 68th and 90th, respectively.
For the second category, Efficiency Enhancers, the country was ranked 78th with a score of 3.9. The six pillars under the category are higher education and training, goods-market efficiency, labor-market efficiency, financial-market development, technological readiness and market size, where the country was ranked 73rd, 97th, 111th, 75th, 95th, and 37th, respectively.
In the last category, Innovation and Sophistication factors, the Philippines was ranked 75th with a score of 3.4. The pillars under this category are business sophistication and innovation, where the country was ranked 60th and 111th, respectively.
Meanwhile, apart from the rankings, respondents to the WEF survey were also asked to select the five most problematic for doing business in their country, on a list of 15 factors. They were asked to rank them between 1, which is the most problematic; and 5, the least problematic.
Corruption, inefficient government bureaucracy, inadequate supply of infrastructure policy instability and tax regulations continue to be the five most problematic factors when doing business in the Philippines, despite its improved ranking in the GCI.
The five least problematic issues were poor public health, inflation, foreign-currency regulations, crime and theft and poor work ethic in the national labor force.
On the other hand, compared with its Southeast Asian neighbors, the Philippines trailed behind most of the countries and was only ranked higher than Cambodia, which was ranked 109th with a score of 3.63.
Southeast Asian countries were led by Singapore, which was ranked 3rd overall with a score of 5.48, followed by Hong Kong Special Administrative Region, which ranked 11th with a score of 5.27; Malaysia, 26th with a score of 4.88; Brunei Darussalam, 28th with a score of 4.75; Thailand, 38th with a score of 4.51; Indonesia, 44th with a score of 4.43; and Vietnam, 59th with a score of 4.27.
Overall, Switzerland topped the ranking in GCI. The United States fell two notches to fourth position, overtaken by Sweden, which was ranked second; and Singapore.
The Nordic countries continue to be well-positioned in the ranking, with Sweden, Finland (7th) and Denmark (9th) among the top 10, and with Norway at 14th.
The United Kingdom, after falling in the rankings over recent years, moved back up by one place to 12th rank.
The WEF explained that the rankings were calculated from both publicly available data and the Executive Opinion Survey, a comprehensive annual survey it conducts together with its network of partner institutes.
These institutes are composed of leading research institutes and business organizations in the countries covered by the report. In the Philippines the survey was made through the Makati Business Club, in association with the Management Association of the Philippines.