My Metro Manila

HIGH levels of corruption, an inefficient bureaucracy and other major issues have caused the Philippines to slip 16 notches to 87th place out of 133 economies in the 2009-2010 Global Competitiveness Index (GCI) released by the World Economic Forum (WEF) on Tuesday.

“We define competitiveness as the set of institutions, policies and factors that determine the level of productivity of a country. The level of productivity, in turn, sets the sustainable level of prosperity that can be earned by an economy. In other words, more-competitive economies tend to be able to produce higher levels of income for their citizens,” the report stated.

Among its peers in Southeast Asia the Philippines almost became the region’s laggard, as Cambodia was the only country that ranked lower than the Philippines at 110th with a score of 3.51.

Singapore ranked third with a score of 5.55.

Malaysia ranked 24th with a score of 4.87; Brunei Darussalam at 32nd with a score of 4.64; Thailand, 36th with a score of 4.56; Indonesia, 54th with a score of 4.26; and Vietnam, 75th with a score of 4.03.

Based on the report, the most problematic factors for doing business in the Philippines were corruption, an inefficient bureaucracy, inadequate supply of infrastructure, and policy instability.

Other concerns were access to financing, tax regulations, crime and theft, tax rates, government instability/coups, restrictive labor regulations, poor public health, a poor work ethic in the national labor force, an inadequately educated work force, and inflation.

The GCI is based on 12 pillars of competitiveness, providing a comprehensive picture of the competitiveness landscape in countries around the world at all stages of development.

The index measured the competitiveness of a country’s institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training, goods-market efficiency, labor-market efficiency, financial- market sophistication, technological readiness, market size, business sophistication and innovation.  The 12 pillars are divided into the categories—the first being “basic requirements,” which includes institutions, infrastructure, macroeconomic stability, and health and primary education. Under this category, the Philippines was ranked 95th with a score of 3.9.

The second category is “efficiency enhancers” which include higher education and training, goods-market efficiency, labor-market efficiency, financial-market sophistication, technological readiness and market size. Here the Philippines was ranked 78th with a score of 3.9.

The third category, “innovation and sophistication factors,” include business sophistication and innovation. The Philippines was ranked 74th with a score of 3.4 here.

In a statement, the WEF said Switzerland dislodged the United States as the country with No. 1 spot in the GCI. The US fell to second place due to its significantly weakened financial markets and macroeconomic stability.

Singapore, Sweden and Denmark round out the top five. European economies continue to prevail in the top 10 with Finland, Germany and the Netherlands following suit. The United Kingdom, while remaining very competitive, has continued its fall from last year, moving down one more place this year to 13th, mainly attributable to the continuing weakening of its financial markets.

The rankings are calculated from both publicly available data and the Executive Opinion Survey, a comprehensive annual survey conducted by the WEF together with its network of Partner Institutes (leading research institutes and business organizations) in the countries covered by the report.

News updates are always brimmed out fresh by Business Mirror.