The Philippines ranked 70th out of a total of 186 countries in the 2016 Index of Economic Freedom published annually by The Wall Street Journal and Washington-based think tank, The Heritage Foundation.
The country’s rank for the 2016 edition of the index is a jump by six ranks from its 76th place ranking last year.
For the 2016 edition, which considered 10 freedoms of Filipinos during the period covering the second half of 2014 up to the first half of 2015, the Philippines scored a grade of 63.1 percent out of a possible 100 percent, up from 62.2 percent in the previous index.
Finance Secretary Cesar V. Purisima said the recent recognition is a result of efforts to instill good governance in the country. “The consistency of results and recognition in the past five years mean only one thing: We must keep the faith in our governing principles. We will continue to expand the field of economic opportunity to enlarge the share of Filipinos benefiting from and contributing to the gains we are making,” Purisima said.
Out of the 10 economic freedoms, the Philippines ranked highest in the government-spending criteria, ranking 20th out of the total 186 countries surveyed, due to the high government spending which amounted to 18.6 percent of the GDP.
According to the latest available figures for fiscal year 2015, government spending amounted to P1.991 trillion from January to November 2015.
However, the Philippines’s rank was dragged down by four economic-freedom criteria in which the country fell below the world average. These economic freedoms are property rights, freedom from corruption, business freedom and labor freedom. The Philippines has its lowest rank in the labor-freedom criteria, ranking only 109th out of the total 186 countries, with a score of 52.9 percent, which is significantly lower than the world-average score of 61.2 percent.
Malacañang welcomed the jump in the overall rank of the Philippines in the said index, and attributed the higher rank to the improvements in the country’s public finance and expenditures.
“Among the successes lauded in the report are the country’s management of public finance and progress in improving the entrepreneurial environment, including the government’s efforts to develop a more vibrant private sector. The index also noted the steady growth of the Philippine economy over the past five years, as well as the gradual modernization of the financial sector. In terms of regulatory efficiency, the report observed that the time and cost of dealing with licensing requirements have notably improved,” Presidential Spokesman Edwin Lacierda said in a news statement.
Lacierda said the 70th rank of the Philippines in the 2016 index is the highest rank attained by the Philippines in that index since it was established in 1995. Since 2012, the Philippines also gained a total of 6 percentage points in its overall score in the index in the Asia-Pacific region.
Each of the 10 economic-freedom criteria has an equal weight in determining the total score of a country.
In the Asia-Pacific region, which includes Australia but not the United States in the index, the Philippines ranked 14th, having higher scores than the regional average in the criteria of trade freedom, government spending, monetary spending, investment freedom and financial freedom.
The Philippines, however, lagged behind its regional grouping in the areas of business freedom, fiscal freedom, property rights, freedom from corruption and labor freedom.
The data gathered in preparing the 2016 Index of Economic Freedom and the analysis of the publishers can be found at www.heritage.org. –David Cahagastian & Bianca Cuaresma, Businessmirror
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