The Philippines slipped from 113th to 124th place in the World Bank’s Ease of Doing Business Report 2019—a survey topped by New Zealand, Singapore and Denmark.
To be sure, the country’s score to 57.68 this year from 56.32 last year. The problem is that other countries improved by a lot more.
This slip in ranking despite marginal improvement in the aggregate indicators of ease of doing business should provide our leaders and economic managers with something to think about during the long weekend break.
First, success is relative.
Progress is never in isolation. Improvements, while measured in absolute terms, is most effectively determined by how well a nation develops in relation to others. Economies compete for investments, and it is performance vis-a-vis other that determines who gets a fair share of available resources.
Second, there are many indicators of success, in this case starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency.
It helps to know in which areas we did well and where we did poorly. For instance, higher tax registration costs and more difficult trade across borders proved a disadvantage to the Philippines’ ranking.
How curious it is, too, to find out that the number of inspection steps for importing has been increased, when we here talk ceaselessly about the Bureau of Customs’ failure to stem the entry of unauthorized material, specifically illegal drugs.
Finally, success in not won on rhetoric, or tough talk, or populism.
Rather, it is numbers that tell a story. In this case, the Philippines did poorly in getting credit (184th, with a score of 5), starting a business (166th, with a score of 71.97) and enforcing contracts (151st, with a score of 45.96).
These statistics will tell our decision makers that it is in these areas where we need to work harder, institute reforms and implement them better.
What political leader does not want to improve the lot of his or her constituents? The answers, however differ in how they intend to do it, and what metrics they use to assess their success or progress.