Philippines one of overperformers in frontier technology

MANILA, Philippines — The Philippines is among the top overperforming countries in terms of use of frontier technologies, which include artificial intelligence, internet of things and big data, according to a report from the UN Conference on Trade and Development (UNCTAD).

In its Technology and Innovation Report 2021, which provides a country readiness index for frontier technologies, the UNCTAD said the Philippines was the second greatest overperformer as it had a better showing than expected based on its per capita income.

In particular, the Philippines got an overall ranking of 44th out of 158 countries, overperforming by 57 ranking positions.

UNCTAD measures overperformance as the difference between the actual index rankings and the estimated index rankings based on per capita income.

In ranking countries’ preparedness to make use of frontier technologies, the UNCTAD looked at the following: information and communications technology (ICT) deployment, skills, research and development, industry activity and access to finance.

Leading the overperformers is India, which placed 43rd and performed better than expected by 65 ranking spots.

Completing the top five overperforming countries are Ukraine, Vietnam and China.

Among the five blocks tracked by the index, the Philippines got its highest ranking for industry activity as it placed second, reflecting high levels of foreign direct investment in high-technology manufacturing, particularly electronics.

“Multinational enterprises are attracted by the country’s strong supply chains and solid base of parts manufacturing. The Philippines also has pro-business policies along with a skilled, well-educated workforce and a network of economic zones,” the UNCTAD said.

Like other top overperforming countries, the Philippines had low rankings in ICT connectivity and skills.

In terms of overall performance, the report showed that the US was the most prepared for frontier technologies.

Switzerland was on second place, followed by the United Kingdom on the third spot.

Other countries in the top five are Sweden, which placed fourth, followed by Singapore.

UNCTAD said countries that topped the overall index have a well-balanced performance across all building blocks, and typically have high innovation and gross domestic product.

For developing countries to catch up, UNCTAD said frontier technologies, which are redefining the world and the post-pandemic future, need to be adopted while diversifying production bases and strengthening innovation systems.

“A whole-of-government approach is needed to absorb these technologies, as opposed to working in silos,” Shamika Sirimanne, director of UNCTAD’s division on technology and logistics said.

Sirimanne said developing countries also need to align science, technology and innovation policies with industrial policies.

“New technologies can reinvigorate traditional production sectors and speed up industrialization and economic structural transformation,” she said.

UNCTAD said cooperation among the government, industry and labor unions would be important to take advantage of frontier technologies to boost productivity.

To be able to adopt frontier technologies in production bases, UNCTAD said governments should look at how to equip the workforce with the necessary digital skills and competencies.

“Governments should also seek to connect everyone online, focusing on the farthest behind, as frontier technologies demand greater digitalization and connectivity. They should provide incentives and subsidies not just for internet access, but also for the devices through which people get connected,” UNCTAD said.