Corruption pulls down RP in think tank’s 2009 report

The Philippines’ ranking in global economic freedom fell 12 notches and found the country “mostly unfree,” because of alleged corruption in the government and a weak judicial system, a US-based think tank said Tuesday.

The conservative Heritage Foundation report entitled “The 2009 Index of Economic Freedom” gave the Philippine economy a score index of 56.8 percent, which makes it the world’s 104th freest among 179 countries.

In the 2008 index, the Philippines ranked 92nd with a score of 56.9 percent and in 2007, the country scored 57.4 percent, ranking 97th.

In Asia-Pacific, the country ranked 20th out of 41 countries with its overall score slightly below the world average.

The top 10 “most free” economies are Hong Kong, Singapore, Australia, Ireland, New Zealand, the United States, Canada, Denmark, Switzerland and the United Kingdom.

Among other Southeast Asian countries, Malaysia ranked 58th; Thailand, 67th; Indonesia, 131st; and Vietnam, 145th.

The US think tank said the Philippines ranked low in freedom from corruption with a score of 25 percent.

“Corruption is perceived as pervasive,” Heritage Foundation said. “The Philippines ranks 131st out of 179 countries in Transparency International’s Corruption Perceptions Index for 2007.”

The report stressed that a culture of corruption is long-standing in the country.

“Enforcement of anti-corruption laws is inconsistent, and the public perception of judicial, executive and legislative corruption remains high,” the US think tank added.

The group said the country’s judicial system is weak and only scored 30 percent.

“Judges are nominally independent, but some have been appointed strictly for political reasons and are corrupt. Organized crime is a strong impediment to the administration of justice, and delays and uncertainty concern investors. Despite some progress, enforcement of intellectual-property rights remains problematic,” Heritage Foundation added.

“The judicial system is weak and vulnerable to extensive political influence,” it said.

The Philippines is also weak in business freedom and investment freedom, the think tank added.

Good points

Meanwhile, the Philippines scored well on trade freedom, 78.6 percent; fiscal freedom, 75.4 percent; government size, 90.8 percent; monetary freedom, 77.2 percent; financial freedom, 50 percent; and labor freedom, 51.4 percent.

“The Philippines has pursued a series of structural-reform measures to develop a more vibrant private sector, generate more job opportunities and enhance business competitiveness. Overall progress has been mixed, and the Philippines still relies heavily on remittances from abroad. The economy scores above the world average in four of the 10 economic freedoms,” Heritage Foundation said.

Under its scoring system, the think tank considers a country as “free” if its average overall score ranges from 80 percent to 100 percent. “Mostly free” countries have an average overall score of 70 percent to 79.9 percent, while “mostly unfree” countries average 50 percent to 59.9 percent. “Repressed” countries score 0 percent to 49.9 percent.

The 2009 Index of Economic Freedom measures 179 countries against a list of 50 independent variables divided into 10 broad factors of economic freedom, such as trade policy, fiscal burden, government intervention, monetary policy, foreign investment, banking and finance, wages and prices, property rights, regulation and informal market.

The report said the low scores are more desirable. The higher the score on a factor, the greater the level of government interference in the economy and the less economic freedom a country enjoys.
— Darwin G. Amojelar, Manila Times