Philippines ranks low in index for digital entrepreneurship

Louella Desiderio - The Philippine Star

MANILA, Philippines — The Philippines ranked 79th out of 113 countries in terms of digital environment and support for entrepreneurship, according to a newly developed global index of the Asian Development Bank (ADB).

ADB’s Global Index of Digital Entrepreneurship Systems (GIDES) for 2021 released yesterday as part of the Asian Development Outlook 2022 Update report showed the Philippines was among the tailenders as it got a score of 18.5 out of 100.

The country’s ranking underscores the need to nurture digital entrepreneurship.

The GIDES measures the quality of the environment for digital entrepreneurs by looking at the level of digitalization in eight areas: culture, institutions, market conditions, infrastructure, human capital, knowledge, finance, and networking.

It places countries in five categories: leaders, followers, catchers-up, laggards and tailenders.

Topping the index was Singapore, which had the best digital entrepreneurship system last year.

This was followed by the US in second place, and Sweden which came in third.

Meanwhile, Mozambique ranked last.

Within Southeast Asia, Singapore was the only country classified as a leader.

Malaysia, which ranked 27th, meanwhile, was classified as a catcher-up.

Other Southeast Asian countries which ranked higher than the Philippines such as Thailand (59th), Vietnam (63rd), and Indonesia (71st) were classified as laggards.

Cambodia, which ranked 101st, was also classified as a tailender.

ADB said digitalization offers big growth opportunities for businesses in Asia and the Pacific.

In particular, digitalization is a driver of innovation, which is important for economies that aim to achieve high-income status.

Digitalization can also help build resilience as seen during the COVID-19 pandemic when digital technology helped businesses continue operations.

In addition, ADB said digitalization can promote inclusive growth by lowering the cost of starting a business.

“Digital entrepreneurship helped economies stay afloat during the COVID-19 pandemic, and it can become a major engine of growth and innovation in the post-pandemic world,” ADB chief economist Albert Park said.

“For this to happen, there needs to be a supportive environment enabled by conducive policies and incentives. While the environment for Asia’s digital entrepreneurs made substantial strides in the past couple of years, there’s still a lot of room for improvement,” he said.

For Asia and the Pacific as a whole, ADB said an insufficiently supportive culture is among the biggest weak spots to encouraging the development of digital entrepreneurship.

Beyond investing in digital infrastructure such as broadband networks, the ADB said governments need to promote political stability, reliable legal systems, open and competitive markets, and strong property rights.


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