The country is up 13 places in the world economic freedom rankings but needs improvement in areas including property rights, fiscal freedom, and government spending says US think tank Heritage Foundation
From being deemed as a “mostly unfree” economy in previous years, the Philippines returned to the “moderately free” category over the last two years under the Aquino administration, according to Washington-based Heritage Foundation, a conservative think-tank.
The 2015 Index of Economic Freedom cited the Aquino administration’s clear government policies that are delivering substantial improvements in the economy, thus improving the Philippines’ standing from 89th in 2014 to 76th in 2015, according to the latest survey results covering 184 countries in the region.
The Philippines scored 62.2 out of a possible 100 – above the global and regional averages – thus allowing the Philippines to emerge in 13th spot among 42 Asia-Pacific countries that were surveyed.
The Philippines increased its scores in such indicators as financial freedom (+10); freedom from corruption (+9.9); labor freedom (+8.5); and monetary freedom (+0.8).
“The Philippines’ performance is one of the best by far in any country where we have the Index,” said Ambassador Terry Miller, director of the Center for International Trade and Economics at the Heritage Foundation.
“This is definitely good news for the Philippines and a reflection of the positive outcome of the good governance efforts that are being undertaken by the Aquino administration,” said Ambassador Jose L. Cuisia Jr.
Cuisia said that the country needs to improve further its scores in property rights (0); fiscal freedom (-0.1); government spending (-3.0); business freedom (-4.6); and trade freedom (-0.1)
Based on an aggregated score, each of the 184 countries graded in the Index are classified as “free” (with a score of 80 or higher), “mostly free” (70-79.9), “moderately free” (60-69.9), “mostly unfree” (50-59.9), or “repressed” (under 50).
The index measures economic freedom based on 10 quantitative and qualitative factors grouped under 4 broad categories or pillars – rule of law, limited government, regulatory efficiency, and open markets.
Hong Kong world’s freest economy
The Philippines, together with Malaysia and Taiwan, helped the Asia-Pacific region post the biggest gain.
Asia-Pacific countries dominate both the top and the bottom of the 2015 Index rankings.
Hong Kong, Singapore, New Zealand, and Australia took 4 of the top 5 slots worldwide.
Hong Kong maintained its status as the world’s freest economy, but a 0.5 drop in its score narrowed its gap with Singapore.
Singapore’s score remained unchanged from the 2014 Index to only 0.2 points.
Hong Kong’s “failure to deliver promised meaningful electoral reform has galvanized greater pro-democracy sentiments…and undermined trust and confidence in the government,” the editors of the report noted.
The world’s most-improved country is São Tomé and Príncipe in Central Africa with a score rising 4.5 points, as it improved in 7 of the 10 economic freedoms, including regulatory efficiency and the rule of law.
But overall, São Tomé and Príncipe remains a “mostly unfree” economy with an overall score of 53.3.
North Korea remains least economically free in the world.
Uzbekistan, Burma, Kiribati, Timor-Leste and Turkmenistan all rank 160th or lower.
This latest grading is an additional boost to the country’s improved standing in global competitive rankings.
As of December 2014, the Philippines improved in 7 of 12 global competitiveness ranking, with the highest jump by 53 notches in World Bank’s Ease of Doing Business report.