Phl competitiveness falls 2 notches to No 43 - survey

Manila, Philippines -  The Philippines’ overall rank in the IMD’s 2012 World Competitiveness Rankings fell to 43 this year from 41 in 2011 as it faces challenges in maximizing benefits of a positive business environment it now enjoys.

Some 59 countries were ranked in the annual study, the results of which were released by the Asian Institute of Management (AIM) yesterday. The Philippines retained its ranking of 13th in the Asia Pacific region from last year.

The survey was conducted by the Institute for Management Development.

The Philippines’ ranking this year is still significantly higher than 39th in 2010. This year’s rank, meanwhile, is the same as in 2009.

The study showed that the Philippines is challenged to maximize the favorable economic environment to implement political and economic reforms, and in turn to induce the positive impact of economic growth on the development of the quality of the workforce.

The country also has to encourage more investments and develop the export industry.

To improve the business environment, the country has to mitigate disaster risks and strengthen cooperation between the government and the private sector. Fast-tracking the development of physical, institutional and social infrastructure.

At the same time, the government should fast-track the development of physical, institutional and social infrastructure to respond to the challenges.

In terms of the strength of the domestic economy, the Philippines ranked 44th and international trade 55th.

From a list of 15 key performance indicators, the Philippines ranked highest in having a skilled workforce 54th; employment 22nd; prices of good and services 17th; public finance 32nd’; fiscal policy 11th; institutional framework 36th; business legislation 49th; societal framework 38th; productivity & efficiency 55th; labor market 1st; finance 29th; management practices 27th; attitudes and values 20th; basic infrastructure 56th; tech. infrastructure 46th; scientific infrastructure 58; health and environment 50th and education 57th.

Out of 15 key attractiveness indicators, the Philippines was graded highest in the executive opinion survey in terms of having a skilled workforce (91.4), open and positive attitudes (65.6), and high educational level of workers (63.4). The country was graded lowest in terms of having a strong research and development culture (9.7), competitive tax regime (4.3) and effective legal environment (4.3).

In its analysis of the country’s ranking, AIM said that the country’s performance ranking in 2012 fell because of an unfavorable global economic environment but that the country, nonetheless, is making progress in key reform areas.

“In part, these results reflect data on the previous year’s economic performance, and so it still mirrors the challenges faced by the country in 2011. Nevertheless, reform areas point to improvements that have begun to pay-off in terms of more positive business perceptions, and perhaps soon also in terms of hard economic numbers,” AIM said.

The country’s economic performance factor fell from a 2011 rank of 29 to a rank of 42, the only decline among the four broad competitiveness indicators covering economic performance, government efficiency, business efficiency and infrastructure.

“A major factor here is that economic growth dipped from 7.6% in 2010 to 3.7% in 2011,” AIM said.