EDITORIAL – A slight improvement, but…

Here’s a bit of good news: the Philippines’ competitiveness rating has risen in an annual international survey conducted by the World Economic Forum. The increase, though only by two notches, is welcome news in a country that has been falling precipitously in other global surveys taken in recent years on national competitiveness. The Geneva-based WEF polled 11,000 business leaders in 125 countries, letting them rank competitiveness based on criteria that included corruption, protection of intellectual property rights, use of technology, the quality of public institutions and judicial independence.

Compared with the rankings of neighboring countries, however, the Philippines’ rating in the WEF survey is nothing to crow about. Two Asian countries are in the Top 10: Singapore retained its fifth place while Japan placed seventh. Two Asian economies are in the Top 20: Hong Kong rose from 14th place last year to 11th while Taiwan fell from eighth to 13th, still way ahead of the next Asian country on the list, South Korea, which fell from 19th place to 24th. Those five have long been touted as Asia’s tiger economies and their prominent spots came as no surprise. Malaysia fell one notch to 26th place but that was not a major slide, and the country has generally sustained its competitiveness over the years.

What the Philippines should take note of is Indonesia’s leap from 69th place to 50th. And of course there’s Thailand, which until 1997 was the Philippines’ closest competitor but has now clearly left us behind, placing 35th from last year’s 33rd. How the recent coup will affect Thailand’s ranking next year is anybody’s guess. The Philippines should also note that it was rated lower than Azerbaijan, Colombia, Croatia and El Salvador.

Filipinos have long known the country’s weaknesses in many of the criteria used for the ranking. Other countries were given credit for solid efforts to deal with those weaknesses. The Philippines keeps getting bad marks in international surveys for the slow pace of reforms. Investors have long complained that change comes slowly in this country. Until that pace can be accelerated and there is genuine resolve to improve national competitiveness, the country will languish in mediocre rankings, doing only slightly better than the conflict areas in the Balkans and Africa.