Becoming More CompetitiveGUILLERMO M. LUZCO-CHAIRMAN, NATIONAL COMPETITIVENESS COUNCIL
Coverage = 142 economies = 99% of world GDP
COUNTRIES WITH COMPETITIVENESS COUNCILSWe are not alone•   Australia                •   Korea•   Argentina                ...
The Global Competitiveness Index 2011-2012Rank   Economy          Score   Rank      Economy                    Score1     ...
Why does it matter?                      GDP per capita (US$)10,000 9,000 8,000 7,000 6,000 5,000                         ...
Why does it matter?                    FDI inflows (US$ million) 14,000                                                Ind...
Spaghetti bowl                 Global Competitiveness Index                 2005          2006          2007   2008   2009...
Our Vision To develop more competitive Philippines To instill a Culture of Excellence in Governance To use Public-Priva...
Our MissionTo build up long-term competitiveness of thePhilippines through –o policy reformso project implementationo inst...
Work Program Benchmark against key global competitiveness  indices Map each indicator to the agency responsible Focus o...
Where we are today  WEF Global Competitiveness Report : No. 75 / 142   (2011)   No. 7 of 8 in ASEAN  IFC Doing Business ...
Our target • WEF Global Competitiveness Report   No. 30 or higher by 2016 • IFC Doing Business Survey   No. 50 or higher b...
Impact : Inclusive Growth o Higher FDI (new investments of 3-4% of GDP), from   US$1.7 billion in 2010 o Double export gro...
2011 PerformanceWorld Economic Forum GCI                          +10IFC Ease of Doing Business                         -2...
World Economic Forum Global Competitiveness Rankings           2011 2010 2009 2008PHILIPPINES 75   85   87   71
Key DriversMacroeconomic Management      +14Technological Readiness       +12Market Efficiency for Goods   + 9Institutions...
Key ConstraintsInstitutions (Governance)            + 8Infrastructure                       - 1Innovation                 ...
The most problematic factors for doing business in the Philippines in 2011                                                ...
Philippine Competitiveness Ranking                       IFC Doing Business Report 2009 - 2012                            ...
PHILIPPINE COMPETITIVENESS RANKING                                   WEF GLOBAL COMPETITIVENESS REPORT 2010 & 2011      20...
INDICATORS                                            RANKING (2010)   RANKING (2011)   change1.11 Efficiency of legal fra...
INDICATORS                                     RANKING (2010)   RANKING (2011)   change2nd pillar: INFRASTRUCTURE         ...
Working Groups1.     Education and Competitive Human Resources2.     Performance Governance System3.     Infrastructure fo...
NCC Co-Chairmen                                 Sec. Domingo (Public Sector)               Mr. G. Luz (Private Sector)    ...
Building Momentum forTransparency National Competitiveness Council Open Government Partnership Integrity Initiative AP...
National Competitiveness Council Office of the Ombudsman Process improvements in business permits, licenses,  registrati...
Open Government Partnership• Government + Business + Civil Society• International partnership. Steering Committee from  US...
Integrity Initiative Private Sector + Government Integrity Pledge (1000+ enterprises) Unified Code of Conduct Pre-requ...
APEC Code of Conduct for Business“Corruption is a serious threat to good  governance and deters investment…fighting  corru...
2012 Plano Continuous tracking of global reportso Regional / Local Competitiveness Councilso Industry Roadmapso National C...
Maintain focus on …o Governance and Bureaucracyo Infrastructureo Macroeconomic managemento Educationo Goods Market Efficie...
Global Competitiveness Index: Comparative Weights   Rank   ScorePhilippines                                               ...
Regional Competitiveness Councilso Encourage     creation    of     regional   /   local competitiveness councils co-chair...
Industry Roadmaps• As competitive environment is created, industry and  individual firms are drivers of growth and wealth ...
National CompetitivenessAssessment and Plano Annual assessment of performance indicatorso Global performance indicators li...
Building Blocks                    National                 Competitiveness                     Plan                      ...
Next steps• Concentrate on Basic Requirement and  Efficiency Enhancers (75+% of weight).• More networking with other clust...
What lies ahead ?• The bar always rises – moving up the “weight  class”• The competition never sleeps• The definition is e...
Becoming More Competitive - Moving in the Top Quartile by Guillermo Luz NCC Private Sector Co-Chairman
Becoming More Competitive - Moving in the Top Quartile by Guillermo Luz NCC Private Sector Co-Chairman
Becoming More Competitive - Moving in the Top Quartile by Guillermo Luz NCC Private Sector Co-Chairman
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Becoming More Competitive - Moving in the Top Quartile by Guillermo Luz NCC Private Sector Co-Chairman

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  • This slide shows the comparative weights assigned per stage of development.
  • Becoming More Competitive - Moving in the Top Quartile by Guillermo Luz NCC Private Sector Co-Chairman

    1. 1. Becoming More CompetitiveGUILLERMO M. LUZCO-CHAIRMAN, NATIONAL COMPETITIVENESS COUNCIL
    2. 2. Competitiveness =The set of institutions, policies, and factors that determine thelevel of productivity of a country, taking into account its level of development.
    3. 3. Coverage = 142 economies = 99% of world GDP
    4. 4. COUNTRIES WITH COMPETITIVENESS COUNCILSWe are not alone• Australia • Korea• Argentina • Mexico• Bahrain • New Zealand• Brazil • Panama• Canada • Philippines• Chile • Russia• Colombia • Saudi Arabia• Croatia • Singapore• Dominican Republic • Sweden• Egypt • United Kingdom• India • United Arab Emirates• Ireland • United States• Japan
    5. 5. The Global Competitiveness Index 2011-2012Rank Economy Score Rank Economy Score1 Switzerland 5.74 21 Malaysia 5.082 Singapore 5.63 24 Korea, Rep. 5.023 Sweden 5.61 26 China 4.904 Finland 5.47 27 United Arab Emirates 4.895 United States 5.43 28 Brunei Darussalam 4.786 Germany 5.41 36 Spain 4.547 Netherlands 5.41 39 Thailand 4.528 Denmark 5.40 46 Indonesia 4.389 Japan 5.40 50 South Africa 4.3410 United Kingdom 5.39 53 Brazil 4.3211 Hong Kong SAR 5.36 56 India 4.3012 Canada 5.33 58 Mexico 4.2913 Taiwan, China 5.26 65 Vietnam 4.2414 Qatar 5.24 66 Russian Federation 4.2115 Belgium 5.20 75 Philippines 4.0816 Norway 5.18 97 Cambodia 3.8517 Saudi Arabia 5.17 142 Chad 2.8718 France 5.1419 Austria 5.14 ASEAN members in bold. Lao PDR and Myanmar not covered20 Australia 5.11
    6. 6. Why does it matter? GDP per capita (US$)10,000 9,000 8,000 7,000 6,000 5,000 China 4,000 Indonesia 3,000 Philippines 2,000 Vietnam 1,000 Cambodia 0Source: IMF 2011
    7. 7. Why does it matter? FDI inflows (US$ million) 14,000 Indonesia 12,000 10,000 Malaysia 8,000 Viet Nam 6,000 4,000 2,000 Philippines 0 -2,000Source: UN 2011
    8. 8. Spaghetti bowl Global Competitiveness Index 2005 2006 2007 2008 2009 2010 2011Percentile Singapore 90th Malaysia 80th China Thailand 70th Indonesia 60th India Vietnam Median Top 53% Philippines 40th 30th Cambodia 20th 10th Bottom
    9. 9. Our Vision To develop more competitive Philippines To instill a Culture of Excellence in Governance To use Public-Private Sector Partnerships as a development engine
    10. 10. Our MissionTo build up long-term competitiveness of thePhilippines through –o policy reformso project implementationo institution-buildingo performance monitoringo goal-setting
    11. 11. Work Program Benchmark against key global competitiveness indices Map each indicator to the agency responsible Focus on lowest-ranking indicators Track city competitiveness and key indicators Working Groups concentrate on specific projects Link Competitiveness Plan to Philippine Development Plan, National Budget, LEDAC, Cabinet Agenda
    12. 12. Where we are today  WEF Global Competitiveness Report : No. 75 / 142 (2011) No. 7 of 8 in ASEAN  IFC Doing Business Survey : No. 136 / 183 (2011) No. 7 of 8 in ASEAN  IMD World Competitiveness Report : No. 41/85 (2011) No. 5 of 5 in ASEAN  FutureBrand’s Country Brand Index : No. 65 / 110 No. 14 of 17 in Asia Pacific
    13. 13. Our target • WEF Global Competitiveness Report No. 30 or higher by 2016 • IFC Doing Business Survey No. 50 or higher by 2016 • IMD World Competitiveness Report No. 20 or higher by 2016 • FutureBrand’s Country Brand Index No. 30 or higher by 2016 • No. 2 or 3 in ASEAN in all rankings
    14. 14. Impact : Inclusive Growth o Higher FDI (new investments of 3-4% of GDP), from US$1.7 billion in 2010 o Double export growth to US$120 billion by 2016 with new products and services to account for 30% of exports o GDP Growth of 7-8% per year o Job Growth / Lower Unemployment o Lower Poverty Incidence : 26.5% in 2009 to 16.6% by 2015 o Growing C socioeconomic class(currently 8.6%); shrinking DE class (currently 91%) Sources: NSCB (Breakdown: 2010 Baseline- US$ 51.39 (goods) US$ 12.27(services) , 2016 Target- US$ 91.5 B (goods) & US$ 28.9 B (services), Chapter 3 Phil Development Plan (Competitive Industry Sector ), NEDA Targets; Phil. Labor and Employment Plan 2011-2016
    15. 15. 2011 PerformanceWorld Economic Forum GCI +10IFC Ease of Doing Business -2 (following a +14 re-rating due to methodology change)IMD World Competitiveness Report - 2Transparency International +5Millenium Challenge Account Pass
    16. 16. World Economic Forum Global Competitiveness Rankings 2011 2010 2009 2008PHILIPPINES 75 85 87 71
    17. 17. Key DriversMacroeconomic Management +14Technological Readiness +12Market Efficiency for Goods + 9Institutions (Governance) + 8
    18. 18. Key ConstraintsInstitutions (Governance) + 8Infrastructure - 1Innovation + 2Labor Market Efficiency - 2Education Higher education & training + 2 Science & Math education quality - 2 Quality of primary education -11
    19. 19. The most problematic factors for doing business in the Philippines in 2011 Percent of responses (weighted totals) 0 5 10 15 20 25 30 Corruption 24.4Inefficient government bureaucracy 18.3Inadequate supply of infrastructure 16.5 Policy instability 7.9 Tax rates 5.7 Crime and theft 5.6 Tax regulations 5.6 Restrictive labor regulations 4.6 Inadequately educated workforce 2.5 Access to financing 2.2 Inflation 2.0 Government instability/coups 1.9 Poor work ethic in national labor… 1.9 Foreign currency regulations 0.5 Poor public health 0.5
    20. 20. Philippine Competitiveness Ranking IFC Doing Business Report 2009 - 2012 2012 2011 2010 2009 Indicators (183 (183 (183 (181 economies) economies) economies) economies)Over-all ranking 136 134 144 140Starting a business 158 155 162 155Dealing w/ construction 102 98 111 105permitsGetting electricity 54 57 - -Employing Workers - - 115 126Registering Property 117 109 102 97Getting Credit 126 116 127 123Protecting Investors 133 131 132 126Paying Taxes 136 127 135 129Trading across borders 51 54 68 58Enforcing contracts 112 114 118 114Resolving Insolvency 163 161 153 151
    21. 21. PHILIPPINE COMPETITIVENESS RANKING WEF GLOBAL COMPETITIVENESS REPORT 2010 & 2011 2010 2010 2011 2011 RED – bottom 20% (111th – 139th) 25 indicators (113th – 142nd) 21 indicators PURPLE – bottom 40-21% (83rd – 110th) 37 indicators (85th – 112th) 36 indicators ORANGE – bottom 50 – 41% (69th – 82nd) 20 indicators (71st– 84th) 17 indicators BLACK (1st – 68th) 29 indicators (1st – 70th) 37 indicators 111 indicators 111 indicatorsINDICATORS RANKING (2010) RANKING (2011) changeOVER-ALL RANKING 85/139 75/142 + 101st pillar: INSTITUTIONS 125 117 +81.01 Property rights 99 105 -61.02 Intellectual property protection 103 102 +11.03 Diversion of public funds 135 127 +81.04 Public trust of politicians 134 128 +61.05 Irregular payments and bribes 128 119 +91.06 Judicial independence 111 102 +91.07 Favoritism in decisions of government officials 131 118 +131.08 Wastefulness of government spending 118 109 +91.09 Burden of government regulation 126 126 01.10 Efficiency of legal framework in settling disputes 122 115 +7
    22. 22. INDICATORS RANKING (2010) RANKING (2011) change1.11 Efficiency of legal framework in challenging 116 118 -2regulations1.12 Transparency of government policymaking 123 120 +31.13 Business costs of terrorism 126 130 -41.14 Business costs of crime and violence 104 112 -81.15 Organized crime 106 102 +41.16 Reliability of police services 105 112 -71.17 Ethical behavior of firms 129 118 + 111.18 Strength of auditing and reporting standards 75 62 + 131.19 Efficacy of corporate boards 56 52 +41.20 Protection of minority shareholders’ interests 80 84 -41.21 Strength of investor protection* 109 111 -2
    23. 23. INDICATORS RANKING (2010) RANKING (2011) change2nd pillar: INFRASTRUCTURE 104 105 -12.01 Quality of overall infrastructure 113 113 02.02 Quality of roads 114 100 + 142.03 Quality of railroad infrastructure 97 101 -42.04 Quality of port infrastructure 131 123 +82.05 Quality of air transport infrastructure 112 115 -32.06 Available airline seat kilometers* 28 28 02.07 Quality of electricity supply 101 104 -32.08 Fixed telephone lines* 106 103 +32.09 Mobile telephone subscriptions* 88 92 -43rd pillar: MACROECONOMIC ENVIRONMENT 68 54 + 143.01 Government budget balance* 62 71 -93.02 National savings rate* 74 70 +43.03 Inflation* 73 69 +43.04 Interest rate spread* 75 50 + 253.05 Government debt* 102 89 + 133.06 Country credit rating* 75 63 + 12
    24. 24. Working Groups1. Education and Competitive Human Resources2. Performance Governance System3. Infrastructure for Competitiveness4. Transaction Costs and Flows5. Import and Export Clearance Process / Single Window6. Power and Energy : Cost and Availability7. Transparency in Budget Delivery8. Judiciary9. Anti-Corruption10. IT Governance Framework
    25. 25. NCC Co-Chairmen Sec. Domingo (Public Sector) Mr. G. Luz (Private Sector) NCC Secretariat Board Members: Public: Secretaries of DepEd, DOT, DOE, DOF, NEDA, Private: J. Ayala, E. Chua, D. Banatao, T. Tancaktiong Infrastructure for Education and Human Competitiveness ResourcesWorking Groups Performance Transaction Costs and Governance System Flows Transparency in Budget Customs/National Single Delivery Window Judiciary System Anti-Corruption ICT Governance Energy and Power Framework Science and Technology * Agriculture * Special Projects
    26. 26. Building Momentum forTransparency National Competitiveness Council Open Government Partnership Integrity Initiative APEC Code of Conduct for Business
    27. 27. National Competitiveness Council Office of the Ombudsman Process improvements in business permits, licenses, registration Budget transparency measures Balanced Scorecard and Multisectoral Governance Councils in National Agencies – DPWH, DSWD, Army, PNP, etc. COMELEC – Campaign Finance Reforms
    28. 28. Open Government Partnership• Government + Business + Civil Society• International partnership. Steering Committee from US, Brazil, Mexico, Norway, UK, South Africa, Indonesia, Philippines• Time-based Country Action Plan (examples) – Disclosure of Budget Information – Disclosure of LGU use of funds – Online posting of “pork barrel” and lump sum disbursements – Freedom of Information Act – Social Audit for Public Infrastructure Projects www.opengovpartnership.org
    29. 29. Integrity Initiative Private Sector + Government Integrity Pledge (1000+ enterprises) Unified Code of Conduct Pre-requisite for bids ?
    30. 30. APEC Code of Conduct for Business“Corruption is a serious threat to good governance and deters investment…fighting corruption is essential to the development of our economies for the benefit of our people.” APEC-wide Business Integrity and Transparency Principles for the Private Sector www.apec.org
    31. 31. 2012 Plano Continuous tracking of global reportso Regional / Local Competitiveness Councilso Industry Roadmapso National Competitiveness Assessment and Plan
    32. 32. Maintain focus on …o Governance and Bureaucracyo Infrastructureo Macroeconomic managemento Educationo Goods Market Efficiencyo Labor Market Efficiencyo Technological Readiness
    33. 33. Global Competitiveness Index: Comparative Weights Rank ScorePhilippines (1–7)GCI 2011–2012 (out of 142) 75 4.1BASIC REQUIREMENTS 60.0 % 100 4.2 Institutions 117 3.2 Infrastructure 105 3.1 Macroeconomic environment 54 5.0 Health and primary education 92 5.4EFFICIENCY ENHANCERS 35.0% 70 4.0 Higher education and training 71 4.1 Goods market efficiency 88 4.1 Labor market efficiency 113 3.9 Financial market development 71 4.0 Technological readiness 83 3.5 Market size 36 4.6INNOVATION AND SOPHISTICATION FACTORS 5.0% 74 3.4 Business sophistication 57 4.1 Innovation 108 2.8
    34. 34. Regional Competitiveness Councilso Encourage creation of regional / local competitiveness councils co-chaired by Public and Private Sectoro Build template of indicators so regions can track their competitiveness for comparison with national and global standardso Involve universities in data-collection and analysis
    35. 35. Industry Roadmaps• As competitive environment is created, industry and individual firms are drivers of growth and wealth creation.• DTI will invite industries to prepare 5 - 10 year industry roadmaps• Roadmaps should describe – – State of industry today – Other country competitors – Potential of industry for value and employment growth – Projected investments by industry players – Policy environment required by industry (e.g., regulatory, infrastructure, human resources, financial, etc.)
    36. 36. National CompetitivenessAssessment and Plano Annual assessment of performance indicatorso Global performance indicators linked to 6- year Philippine Development Plano 10 to 20 year strategic long-term perspective
    37. 37. Building Blocks National Competitiveness Plan Regional IndustryWorking Groups Competitiveness Roadmaps Councils
    38. 38. Next steps• Concentrate on Basic Requirement and Efficiency Enhancers (75+% of weight).• More networking with other clusters (e.g., Social Cluster, Governance Cluster)• Undersecretaries permanently assigned to Working Groups as point persons for Departments• Establishment of Competitiveness Teams in key Departments
    39. 39. What lies ahead ?• The bar always rises – moving up the “weight class”• The competition never sleeps• The definition is evolving  sustainable competitiveness  not compromising future generations’ ability to grow

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