19 Jun 2024 – The Philippine Economy Is the Least Competitive in Southeast Asia, Report Says Across the Asia-Pacific region, the country ranks second to the lowest.

By CURRIE CATOR |
Jun 19, 2024

With rising inflation and tensions in Ukraine and the Middle East, economies from all over the world have faced immense challenges in recent years. The Philippines is no exception—seemingly showing no sign of improvement compared to its neighbors. The country ranked dead last in terms of competitiveness, placing fifth among five members of the Association of Southeast Asian Nations (ASEAN); while the economy placed 13th out of 14 countries across the Asia-Pacific region.

These findings were based on the 2024 World Competitiveness Yearbook. The report assesses economies based on various criteria anchored on four main factors: economic performance, government efficiency, business efficiency, and infrastructure. Not only did the Philippines turn out to be among the lowest placed in the region, but it also kept its ranking at the 52nd spot among 67 countries globally, similar to its position in 2023.

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Driving the supposed lack of progress in the Philippines’ standing is a decline in its business efficiency, specifically in the areas of labor market, finance, management practices, and attitudes and values, according to the report. Maintaining its infrastructure continues to be a perennial challenge for the country, too. This spans across basic, technological, and scientific infrastructures, as well as education.

“The Philippines faces significant challenges, including revitalizing economic dynamism and growth trajectory; managing inflation expectations; building sustainable physical, social, and technological infrastructure to improve productivity and reduce vulnerabilities; and addressing territorial disputes in the West Philippine Sea to mitigate economic disruptions,” the report noted.

The study, however, pointed out a slight improvement in government efficiency in the Philippines, particularly in public finance and institutional framework. To recall, the country was also named the “most transparent” of all Asian countries when it comes to the disclosure of public funds. The Philippines’ economic performance, on the other hand, maintained its position at 40th place, just like last year.

The top three competitive countries worldwide are Singapore, Switzerland, and Denmark. Singapore also emerged as the leading economy in the Asia-Pacific region this year, followed by Hong Kong and Taiwan.

The annual World Competitiveness Yearbook is produced by the Philippines’ Asian Institute of Management Rizalino S. Navarro Policy Center for Competitiveness (AIM RSN PCC), in partnership with Switzerland-based International Institute for Development Management. The report analyzes and compares the ability of countries to provide efficient structures and institutions, as well as policies that allow its enterprises to compete locally and internationally. It utilizes both hard data from national sources and perception-based indicators gathered through surveys.