Some inefficient LGU officials could dent Phl business growth

CEBU, Philippines - A local economist lauded the efforts of the national government and the private sector for the Philippines to deserve its spotlight in the recent Doing Business report of the World Bank but criticized the efficiency of local government units particularly the barangay officials in ensuring the ease of doing business for potential investors that could have placed the country in a better limelight.

Philippines is hailed as one of the top 10 reformers in improving business regulation among 189 economies in the world. It is considered to be the first major improvement for the country in the Doing Business ranking since the inception of the report 11 years ago.

Last October 29, the World Bank and International Finance Corporation (IFC) released the findings of the new Doing Business report which measures the efficiency and strength of laws, regulations and institutions that are relevant to domestic small and medium-sized companies throughout their life cycle.

The Philippines jumped up in ranking by 30 points from 138 last year to 108th place this year. In the same report released last year, the Philippines fell two notches from its 136th place out of 183 economies in 2011.

Cebuano economist and The FREEMAN columnist Fidel Abalos acknowledged the determination of the national government to improve the delivery of its services over the years through good governance and less corruption.

“Generally, it is a good thing. We can feel it here in Cebu,” he said.

The Doing Business report cited that the government implemented regulatory reforms in three areas which include the introduction of a fully operational online filing and payment system made tax compliance easier for companies, simplified occupancy clearances eased construction permitting and new regulations guarantee borrowers’ right to access their data in the country’s largest credit bureau.

Abalos also recognized the remarkable performance of the Bureau of Internal Revenue which is evident to the agency’s aggressive and strict tax collection.

He further acknowledged the effective implementation of the Republic Act No. 10142 which is also known as the Financial Rehabilitation and Insolvency Act of 2010, an act providing for the rehabilitation or liquidation of financially distressed enterprises and individuals.

The act encourages debtors and creditors to collectively and realistically resolve and adjust competing claims and property rights. It also ensures a timely, fair, transparent, effective and efficient rehabilitation or liquidation of debtors.

“We are reaping the benefits of the law. These areas where we really improve in are the fruits of  our labor,” Abalos said.

While the national government is taking the lead towards the improvement of the country in terms of the ease of doing business, he however pointed out that the local government units, specifically those in the barangay level, is doing the opposite.

Now that the barangay elections in the country have recently concluded, he urged newly-elected officials to be responsible and effective in their roles as leaders. 

He cited that most of  the barangay captains do not regularly stay in their offices since they juggle their time with their primary livelihood and their secondary job as public servants.

If only these officials could fully dedicate themselves to their time in delivering efficient services, Abalos said that it requires shorter time for applicants to have their barangay permits approved from the barangay hall.

“It starts with the barangays. It is sad to note though that our barangays are very inefficient. These officials who are ought to be responsible are considering public service as just side-lines. We will not improve if this attitude remains,” he said.

Abalos agreed with the statement made by World Bank Philippines country director Motoo Konishi who said that the country needs to focus on major improvements in areas of business registration and renewal of  various permits.

“We are busy doing improvements in some factors but there are also areas wherein we are not doing good. Obtaining construction permits and acquiring business permits are still difficult to do here in the country. It is quite sad so we have to work on that,” Abalos said.

Konishi shared that an entrepreneur in Malaysia needs only six days and three steps to register a business but takes 15 steps and 35 days in the Philippines.

He suggested that an effective electronic platform for business registration would help the country reduce costs and improve transparency and accountability of  the various agencies which are responsible for each step in business registration.

Konishi expressed hope that the Philippines shall continue to implement reforms for a better environment for businesses especially the small and medium enterprises that could eventually result to the generation of quality jobs for  Filipinos.

This year’s Doing Business Report is considered to be the 11th in the series of the annual flagship reports of  the World Bank Group. The 2014 report presents data for 189 economies of which four economies such as Libya, Myanmar, San Marino and South Sudan are collected for the first time this year. /JOB (FREEMAN)