Red tape drags RP further down in competitiveness
By Roderick T. dela Cruz
THE Philippines has the most number of procedures for starting and closing a business, making its economy among the least competitive in the world.
Of 181 countries surveyed in a joint study by the World Bank and the International Finance Corp., the Philippines ranked 140th, and behind other developing Southeast Asian countries such as Cambodia and Vietnam.
The country’s ranking in the Doing Business 2009 survey was four notches below its 136th place in 2008.
Singapore topped the list of 181 countries surveyed, while Congo was placed at the bottom.
Rounding out the top 10 list were Singapore, New Zealand, the United States, Hong Kong, Denmark, the United Kingdom, Ireland, Canada, Australia and Norway.
The study said the Philippines had the most number of procedures for starting a business at 15, compared with only one procedure in Canada.
The Philippines was also listed as one of the countries where it is most difficult to close a business, taking as long as 5.7 years to resolve a bankruptcy.
Southeast Asian countries that ranked high in the 2009 list were Singapore at 1st place; Thailand, 13th; Malaysia, 20th; Brunei, 88th; Vietnam, 92nd; Indonesia, 129th; and Cambodia, 135th.
In the region, the Philippines only ranked higher than Laos (165th) and East Timor (170th).
The report ranked 181 economies based on 10 indicators of business regulation that record the time and cost to meet government requirements in starting and operating a business, trading across borders, paying taxes, and closing a business.
“Economies need rules that are efficient, easy to use and accessible to all who use them. Otherwise, businesses are trapped in the unregulated, informal economy, where they have less access to finance and hire fewer workers and where workers lack the protection of labor law,” said Michael Klein, World Bank/IFC vice president for financial and private sector development.
The report says that while the Philippines allows entrepreneurs to reserve the company name and register online, the procedures still requires payment in person.
The study says East Asia and the Pacific region had the greatest momentum in reforming business regulations. The study identified 26 reforms between June 2007 and June 2008 that make it easier to do business in 24 economies in the region.
“Countries in the region are clearly committed to reform agendas,” said Dahlia Khalifa, a co-author of the report. “Regardless of their stage of economic development, they are recognizing the role that regulatory reform can play in staying competitive while boosting entrepreneurship and job creation.”
China, one of the world’s emerging markets, landed in 83rd spot but was cited for reforms in making it easier to get credit, pay taxes and close a business. The study says Thailand implemented reforms that protect investors, making it easier to get credit, pay taxes and trade across borders.
-------------------------------------------------------------------------------------------------
Whats your take on this..of all the Southeast Asian countries, the Philippines only ranked higher against East Timor and Laos.
Philippines further down in world economic competitiveness
Reply With Quote
Posting Permissions
