By Louella Desiderio, October 17 2018; Philippine Star

Image Credit to Business World

MANILA, Philippines — The Philippines ranked 56th out of 140 countries in the latest Global Competitiveness Report of the World Economic Forum.

WEF’s Global Competitiveness Index 2018 released by partner institute Makati Business Club (MBC) to the media yesterday showed the Philippines as the fifth most competitive economy in Southeast Asia.

Within the region, the Philippines was behind neighbors Singapore (second), Malaysia (25th), Thailand (38th) and Indonesia (45th), but ahead of Brunei Darussalam (62nd), Vietnam (77th), Cambodia (110th) and Lao People’s Democratic Republic (112th).

The US topped this year’s WEF Global Competitiveness Report. Singapore was in second place, with Germany in third spot.

Chad, meanwhile, was the bottom-dweller, at 140th spot.

For the rankings, the report looked at 12 pillars: institutions, infrastructure, information and communication technology adoption, macroeconomic stability, health, education and skills, product market, labor market, financial system, market size, business dynamism and innovation capability.

Of the 12 pillars, the Philippines was strong in market size (32nd), labor market (36th), financial system (39th) and business dynamism (39th).

Business dynamism includes the time to start a business as well as the cost of starting a business and insolvency rates.

“While the time and cost of starting a business remain as problematic factors for the business community, it is worthy to note that the Philippines ranks high in e-participation or the use of online platforms to link government information to citizens,” MBC chairman Edgar Chua said.

“With the recently passed Ease of Doing Business Act, we remain optimistic that the government will be able to sustain these gains and address the concerns of efficiency in doing business,” he added.

Republic Act 11032 or the Ease of Doing Business Act, which was signed into law by President Duterte in May, provides a required number of days for processing government transactions to address bureaucratic red tape.

Meanwhile, the country was weak in institutions (101st), health (101st) and infrastructure (92nd).

Under the institutions pillar, critical indicators where the Philippines ranked poorly include terrorism incidence, homicide rate, organized crime and reliability of police services.

In infrastructure, the Philippines had low rankings in road connectivity, exposure to unsafe drinking water, efficiency of train services and electrification rate.

“While we continuously build on our strong pillars, it is equally important to address our weak spots. The business community remains committed to work with the government to address these gaps, especially in our weakest links in ease of doing business, corruption incidence and infrastructure, particularly in road connectivity,” Chua said.

As the WEF transitioned to a new index for this year’s report, the rankings are not comparable with previous reports.

This year’s report focused on what a country should prioritize, whether a country is making progress over time and what a country can learn from high-performers.