Enjoying a favorable performance in its economy and having a government with a determined anti-corruption drive, the Philippines leaped by 10 notches in the global competitiveness ranking for the year to 65th out of 144 countries.
The country's latest performance followed a similar 10-notch jump to the 75th spot in 2011, thereby resulting in a 20-notch overall jump so far in the Aquino administration.
"The Philippines makes important strides this year in improving competitiveness—albeit often from a very low base—especially with respect to its public institutions," The World Economic Forum (WEF) said in its 2012-2013 Global Competitiveness Report, which was released Wednesday worldwide.
According to the WEF, the Philippines was one of the few countries that registered a double-digit improvement in ranking this year.
The Philippines landed on the 65th spot after it registered an overall score of 4.23 points (out of 7 points) across all 12 categories considered by businesses as major areas for determining a country's competitiveness.
Guillermo Luz, co-chairman of the Philippines' National Competitiveness Council (NCC), said in a press conference on Wednesday that this year was the first time the country landed on the list of upper 50 percent of countries ranked in the global competitiveness survey.
He said the NCC has been targeting the Philippines to land on the list of the upper one-third of the global competitiveness rankings by 2016, the end of the Aquino administration.
The survey on global competitiveness, which taps businesses as respondents, grades countries based on the following 12 categories or "pillars": [government] institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market development, technological readiness, market size, business sophistication, and innovation.
Luz said the Philippines registered improvement in 11 out of the 12 categories.
The Philippines gained the most in the "institutions" category, where it jumped by 23 places to 94th from last year's 117th.
In the "infrastructure" category, the country improved its ranking by seven places to 98th; for "macroeconomic environment," up 18 places to 36th; for "higher education" and training, up seven places to 64th; for goods market efficiency, up two places to 86th; for labor market efficiency, up 10 places to 103rd; for financial market development, up 13 places to 58th; for "technological readiness," up four places to 79th; for "market size," up one place to 35th; for "business sophistication," up eight places to 49th; and for "innovation," up 14 places to 94th.
The only category where the Philippines registered a ranking slippage was in "health and primary education," where it fell six places to 98th.
Luz said the country's favorable performance in the "institutions" category reflected the success so far of the Aquino administration to convince the business sector that there has been improvement in governance so far in his term.
Out of the 15,000 businesses that served as respondents to the global competitiveness survey for this year, 132 came from the Philippines.
On the "macroeconomic environment" category, Luz attributes the country's improved ranking in the country's favorable economic performance.
The Philippine economy grew by 5.9 percent in the second quarter from a year ago, making the country one of the fastest-growing economies in Asia. This brought its average growth for the first semester to 6.1 percent, keeping the government's full-year growth target of 5 to 6 percent attainable.
Ramon del Rosario Jr., chairman of the Makati Business Club, however, said a lot of work still has to be done in several areas to help ensure the Philippines meets the 2016 target as far as its global competitiveness ranking is concerned.
To reach the upper one-third of the rankings by 2016, he said, the country must improve significantly on the area of infrastructure development and market efficiency, particularly labor market efficiency.
Despite increases in government spending on infrastructure this year, infrastructure investment in the Philippines remains one of the lowest in the region. Infrastructure spending in the country is estimated to be equivalent to less than 3 percent of the country's gross domestic product, below the 5 percent average for Southeast Asia.
"Despite these very positive trends, many weaknesses remain to be addressed. The country's infrastructure is still in dire state, particularly with respect to sea and air transport, with little or no progress achieved to date," Del Rosario said in the same press conference.
He said businesses have always considered infrastructure a vital area considered by firms in deciding whether or not to invest in a country.
With its improved ranking this year, the Philippines has beaten Vietnam, which enjoyed better rankings than that of the Philippines in the past years. This year, Vietnam ranked 75th.
The Philippines continues to lag behind other major Asian economies in the global competitiveness rankings.
Hong Kong ranked 9th, Taiwan 13th, South Korea 19th, Malaysia 25th, China 29th, Thailand 38th, Indonesia 50th, and India 59th.
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