29 °C Manila, PH
17th November 2018

Competitiveness Report: Beyond Infrastructure, PH Needs Better Regulations

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The Philippines has shown remarkable improvement in the global travel and tourism landscape last year, but much has to be done and fulfilled before the country can start reaping the industry’s benefits the way the rest of the top 81 most competitive economies do.

The World Economic Forum (WEF) Travel and Tourism Competitiveness Report 2013 highlighted low visa requirements, government’s commitment and spending on the industry, and price competitiveness as among the strengths of the Philippines. For visa requirements alone, it ranked as the most competitive among 140 economies assessed.

“The Philippines is the most improved country in the region, ranking 16th regionally and 82nd overall, up 12 places since the last edition,” the WEF noted. The organization has been conducting the study since 2007 and released four editions so far. For the first time, the country saw progress in ranking, which met a straight nose dive from 86th in 2007 and 2009 to 94th two years ago.

The WEF utilized data coming from international organizations like the UNWTO and IATA as well as an executive opinion survey among local respondents through the Makati Business Club and the Management Association of the Philippines.

In addition to certain strengths in policy, the study found specific areas in Philippine human, cultural, and natural resources as strong; however, these cannot generalize the desirability of local attractions. Imbalances and inconsistencies exist of the country’s strengths and weaknesses across the 14 competitiveness pillars such that, for instance, visa requirements is a strong point but related policy areas like cost of doing business and government transparency are both ranked at a weak spot of 94th.

In another case, for human resources pillar, hiring and firing practices and ease of hiring foreign labor ranked 105th and 117th respectively. They neutralized the positive gains made by the quality of education system (45th) and staff training (32nd) also under the same pillar.

Among the 69 competitiveness aspects the WEF looked at, three out of every five areas rank the Philippines below the top half of 140 countries. In general, the WEF analyzed data on regulations, business and infrastructure, and resources. The Philippines need to improve on the first two items to get a significant lead at the next evaluation.

Under regulations, safety and security (103rd) is the highest concern, clearly pointing out that the respondents don’t find the police force reliable (97th) and business costs of environmental crimes (103rd) and terrorism (122nd) run high. The low number of available physicians and hospitable beds and inaccessibility of safe drinking water also defeat gains in medical tourism, allowing health and hygiene to settle at 94th place.

The same goes for air, ground transport, and ICT. Quality of airport infrastructure, in particular, has been ranked 110th—far from Asia-Pacific neighbors Malaysia (26th), India (68th), Cambodia (75th), Pakistan (78th), and Indonesia (89th).

As President Aquino’s administration enhances interagency convergence and allots massive funding on infrastructure, the same priority would have to be given on enforcement especially on environmental regulations (92nd) and support services like security and health. The wide-ranging areas that the WEF evaluated remind national governments that travel and tourism competitiveness put emphasis on all a country is—not just on visa or beach destinations.


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