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Opinion

EDITORIAL - Moderately free

The Philippine Star

For the third consecutive year, the Philippines has seen its rank improve in the annual index on economic freedom. From last year’s 97th place, the Philippines improved to 89th out of 178 countries rated in the 2014 Index of World Economic Freedom.

The index, drawn up since 1995 by the Washington-based think tank Heritage Foundation together with The Wall Street Journal, considers 10 freedom categories: labor, business, trade, fiscal, government spending, monetary, investment, financial, property rights, and freedom from corruption. From a score that rated the Philippine economy “mostly unfree,” the country is now rated “moderately free.”

Reforms to enhance the investment climate were credited for the improvement. The report, however, noted that deeper commitment to reforms was needed, particularly in upholding the rule of law, and even in the fight against corruption. Despite the improvement, the Philippines is behind many of its neighbors in the index, and is a long way from the world’s top two freest economies, both of which are in Asia: Hong Kong and Singapore.

It’s no coincidence that these are also among Asia’s most prosperous economies. And it’s no coincidence that countries ranking high in the index are also among the most prosperous and competitive, rating high in surveys on quality of life. Hong Kong and Singapore, which held on to the top two spots for the 20th straight year, were followed by Australia, Switzerland, New Zealand and Canada.

Many of the factors that pull down the Philippines in the index are deeply entrenched institutional weaknesses. Reforms in these sectors can threaten the interests of influential business and political groups. Other reforms call for personnel changes or better training as well as better systems and procedures to drastically cut red tape and reduce opportunities for corruption. For the daang matuwid administration, these should not prove to be impossible tasks.

 

 

 

 

FREEDOM HERITAGE FOUNDATION HONG KONG AND SINGAPORE INDEX INDEX OF WORLD ECONOMIC FREEDOM NEW ZEALAND AND CANADA PHILIPPINES REFORMS WALL STREET JOURNAL
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