The Philippines dropped 10 notches in ranking in the latest release of the World Economic Forum-Global Competitiveness Report (WEF-GCR), falling to 57th place out of 138 countries from 47th out of 140 countries last year.
This is the first time in seven years that the country dropped in the rankings.
The annual GCR provides a comprehensive picture of the productivity and competitiveness of economies by gathering statistical and survey data on over 114 indicators grouped into 12 pillars across 138 countries. The report series remains the most widely read comprehensive assessment of national competitiveness worldwide.
“It is, of course, disappointing to experience this fall in spite of all efforts to improve competitiveness. Our score dropped minimally from 4.39 to 4.36 out of 7 but it was enough to bring us down by countries. The world is so competitive that even small changes make a big difference in ranking,” National Competitiveness Council private sector co-chairman Guillermo M. Luz said in a statement.
In the 2016 WEF-GCR report, the Philippines dropped in eight of the 12 pillars. The largest drops were reported in goods market efficiency (down 19, from 80th to 99th); technological readiness (down 15, from 68th to 83rd); institutions (down 14, from 77th to 91st); innovation (down 14, from 48th to 62nd), and business sophistication (down 10, from 42nd to 52nd).
The country also recorded declines in infrastructure (down 5, from 90th to 95th); labor market efficiency (down 4, from 82nd to 86th); and market size (one notch down to 31st).
On the other hand, the Philippines showed gains in higher education and training (up 5, from 63rd to 58th); health and primary education (up 5, from 86th to 81st), and macroeconomic environment (up 4, from 24th to 20th). Macroeconomic management remains the country’s strongest performing pillar in the overall index. Its financial market development indicator rank remains unchanged at 48th.
“The new ranking brings us further away from our intermediate goal of being in the top third of global rankings. We will need to focus even more on our challenges—bureaucracy, infrastructure, technology, and innovation—to make the country more competitive,” said Luz.
The WEF noted the Philippines’ decline in rankings despite a negligible drop in the Global Competitiveness Index (GCI) score (4.39 to 4.36). WEF added that the country is in the “flat zone” of the ranking, where many countries are very close to each other in terms of scores. A small variation in the score can result in a big rank shift.
Despite the drop, WEF cited the Philippines as one of the three most improved economies in the Asia Pacific since 2007, along with China and Cambodia.
Switzerland, Singapore, and the United States remain the world’s three most competitive economies
The Switzerland-based WEF explained that the data gathering was conducted before]the Philippine national?[ elections, and the executive opinion survey was conducted during the campaign period.
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