Gameplan Presented: Competitiveness Ranking Vault Is Possible

The country’s global competitiveness ranking can be improved to as much as 109 from the current 138 out of 185 countries if all recommendations and reforms are completed on all ten indicators to competitiveness even at moderate level.

This is the “Low Hanging Fruit Scenario” of the “Gameplan for Competitiveness” presented by the National Competitiveness Council (NCC), a public-private task force on Philippine Competitiveness by virtue of Presidential Executive Order (EO) No. 571 to address the improvement of the country’s competitiveness, which outlines three simulations on how to level up the country’s competitiveness.

“We need a leap frog movement not 138 to 135 or 128 but 108. We have to be thinking in that magnitude. We have to go for big gains,” NCC co-chairman Guillermo Luz said at yesterday’s presentation of the “Gameplan for Competitiveness.”

Luz said that the 109-108 ranking can be achieved by completing at moderate all recommendations on the following indicators: starting a business, dealing with construction permits, registering property, getting credit, protecting investors, paying taxes and resolving insolvency.

These reforms must be implement and enforced by July 1, 2013 to make an impact in the “Ease of Doing Business” survey by the International Finance Corp. where the Philippines has been lagging behind even among ASEAN countries. This means the impact on the IFC survey would be reflected in the 2014 IFC Ranking report.

Hans Shrader, senior program manager of IFC, noted in his briefing on the IFC 2013 Report for the Philippines likened the country’s competitiveness to a basketball game where the Philippines just continue dribbling but not able to pass that ball and shoot that ball.

“It is more beyond passing to implementation and enforcement,” he said.  “This time we should be able to pass the ball, shoot and score,” Luz said.

Based on the simulation, if only reforms are implemented, enforced and measured on four indicators: starting a business, getting credit, protecting investors and resolving insolvency the Philippines can hit move up 27 notches higher to 108 ranking by 2014. Of the ten indicators, the Philippines rank low in 10.

For instance, on starting a business where the Philippines ranked 161 in the 2013 Ranking from 158 in 2012, the NCC has recommended to reduce the number of days, number of steps, implementation of online business registration and removal of the minimum paid in capital requirement. Measures to improve this indicator have to be implemented by the Securities and Exchange Commission, Social Securities System, Bureau of Internal Revenue, Philippine Business Registryu, PhilHealth, Pag-Ibig and Congress.

On the “Leap Frog” scenario, the gameplan showed a total effect on the country’s world ranking to 125 or 13 notches higher than the current 138 ranking if all recommendations and reforms are completed on all indicators by July 1, 2013.

The most aggressive gameplan is the “Stretch Target” scenario where the country’s ranking should move up 38 notches higher to 100 from 138. This can be done if the government can make significant strides in on four big impact indictators: starting a business, getting credit, protecting investors and resolving insolvency.

The target is to improve to 150 ranking for the starting a business indicator from 158 and getting credit to 78 from 126 and protecting investors to 46 from 133. There is no target ranking for resolving insolvency but it showed that it is taking five years to a business to file for insolvency.

Luz said the Philippines has been languishing in the same spot for too long and this is the first time that government and private sector are making a concerted move to go up the ladder in the world competitiveness ranking on ease of doing business.

By Bernie Cahiles-Magkilat
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