Guillermo Luz, co-chair of the National Competitiveness Council, a public-private sector body dedicated to building up the long-term competitiveness of the Philippines, emailed to us recently a summary of how our country performed in various global competitiveness reports in 2012.
“In the World Economic Forum’s Global Competitiveness Index, we rose 10 ranks to No. 65 out of 144 countries. We were also up 10 countries the year before; the 20-country jump is one of the highest in the world in the last two years;
“In the IFC Ease of Doing Business Report, we remained in the same position – No. 138 out of 185 this year vs. No. 136 out of 183 last year;
“In the IMD World Competitiveness Report, we dropped by two to No. 43 out of 59;
“In the Heritage Foundation’s Index of Economic Freedom, we rose by eight to No. 107 out of 184 countries;
“In the Transparency International Corruptions Perception Index, we rose by 24 to No. 105 out of 176, though numbers are not directly comparable to the previous year because of a methodological adjustment. Nonetheless, we rose within ASEAN from No. 7 to No. 5 out of 10;
“In the Global Information Technology Report, we rose by four to No. 86 out of 142, adjusted for new countries added to the sample;
“In the Global Innovation Index, we rose by 12 to No. 95 out of 141, also adjusted for new countries added to the sample.
“And finally, in FutureBrand’s Country Brand Index, we fell by 12 to No. 95 out of 118, also adjusted for new countries added to the sample.
Luz expressed particular concern about the fact that in the IFC list, the Philippines has not made any significant improvement in the last three years.
Why would anybody want to do business in the Philippines?
Actually, if we take a look at what other neighboring countries offer in terms of incentives for investments, the Philippines is not really that far behind. Our business incentives, set forth in the Omnibus Investments Code of 1987 and the Investment Priorities Plan (IPP), the Foreign Investments Act of 1991, the PEZA and BCDA laws, among others, are attractive though confusing. Our income tax holidays are very generous (six, four, or three years depending on whether the business is newly registered pioneer, non-pioneer, or existing expanding).
But doing business is not just about the incentives.
Yes it is true that the likes of Hongkong’s First Pacific through Manny Pangilinan, San Miguel Corp. and its president Ramon Ang, the SM group, Alliance Global/Megaworld, the Gokongwei group, the Ayala group, to name a few, continue to invest by building mega-infrastructure, massive real estate projects, but these are local businessmen who already familiar with the rules of the game, both written and unwritten, and who know how to survive despite unwarranted government intervention or non-action by government when needed.
But how about unsuspecting foreign businessmen who have to learn many of the rules by experience?
Global competitiveness is not something that government or big business can achieve on their own. Just like in many countries in our region, being globally competitive must be a mindset of each and every individual.
Each and every Filipino must know what it means for the Philippines to be globally competitive. Will being globally competitive mean more food on the table, more jobs, cheaper goods and services? If global competitiveness will mean all these and our government undertakes a campaign to create a spirit of wanting to be the best in each individual, then we might finally achieve something as a nation.
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