Philippine Competitiveness and the Ten-point Agenda Arangkada Philippines Forum 14 September 2017 Mariott Hotel GUILLERMO M. LUZ Private Sector, Co-Chairman
10 Point Socioeconomic Agenda 1. Continue and maintain current macroeconomic policies. 2. Institute progressive tax reform and more effective tax collection. 3. Increase competitiveness and the ease of doing business. 4. Accelerate annual infrastructure spending to account for 5 percent of GDP, with Public-Private Partnerships playing a key role. 5. Promote rural and value chain development toward increasing agricultural and rural enterprise productivity and rural tourism. 6. Ensure security of land tenure. 7. Invest in human capital development (e.g., education, health) 8. Promote science, technology and the creative arts. 9. Improve social protection programs. 10. Strengthen implementation of the Responsible Parenthood and Reproductive Health Law..
GLOBAL COMPETITIVENESS REPORT CARD *with 2016 Results, **reverse ranking (1 as worst) REPORT 2010/2011 2016/2017 GOAL (Top 3rd) CHANGE 4 to 6 yrs 1.Doing Business Report (IFC) 148/183 99/189 63 49 2. Economic Freedom Index (HF)* 115/179 58/180* 60 57 3. Corruption Perceptions Index (TI) 134/178 101/175 58 33 4. Global Competitiveness Index (WEF) 85/139 57/138 47 28 5. Global Enabling Trade Index (WEF) 92/125 64/138 46 28 6. Travel and Tourism Report (WEF) 94/139 79/36* 46 15 7. WIPO- Global Innovation Index (WIPO) 91/125 73/128* 42 18 8. Global Information Technology Report (WEF) 86/138 77/139 46 9 9. E-Government Index (UN) 78/184 71/193 64 7 10. Fragile States Index (FFP) ** 50/177 54/178 118 4 11. Global Gender Gap Report (WEF) 9/142 7/144 47 2 12. World Competitiveness Report (IMD) 41/59 41/63* 23-13. Logistics Performance Index (WB) 44/155 71/160 53 27 REACHED THE TOP THIRD LATEST PERFORMANCE UPGRADE DOWNGRADE *with 2017 Results, **reverse ranking (1 as 3 worst)
GLOBAL COMPETITIVENESS REPORT 2010-2016 Percentile Rank Upper 1/3 10 30 Reached Top Third Target: #46 (Top Third) 50 Middle 1/3 Bottom 1/3 70 90 100 120 138 Current Ranking 2010 2011 2012 2013 2014 2015 2016 TOP THIRD
GLOBAL COMPETITIVENESS REPORT PHILIPPINES and ASEAN Economy 2016 (out of 138) 2015 (out of 140) 2014 (out of 144) 2013 (out of 148) 2012 (out of 144) 2011 (out of 142) 2010 (Out of 139) Change 2015-2016 Change 2010-2016 Singapore 2 2 2 2 2 2 3 0 1 Malaysia 25 18 20 24 25 21 26-7 1 Thailand 34 32 31 37 38 39 38-2 4 Indonesia 41 37 34 38 50 46 44-4 3 Philippines 57 47 52 59 65 75 85 5 28 Vietnam 60 56 68 70 75 65 59-4 -1 Lao PDR 93 83 93 81 n/a n/a n/a 10-12 Cambodia 89 90 95 88 85 97 109 1 20 Myanmar --- 131 134 139 n/a n/a n/a -- -- Brunei Darussalam 58 n/a n/a 26 28 28 28 -- -30
Top 4 Gains Since 2010/11 +57 +49 No. 58 from No. 115 +33 No. 99 from No.148 +28 No. 101 from No. 134 Economic Freedom Index No. 57 from No. 85 Corruption Perception Index Doing Business Report Global Competitiveness Report
Cities and Municipalities Competitiveness Index (CMCI)
Cities and Municipalities Competitiveness Index (Cmci)
The CMCI Framework ECONOMIC DYN AMISM GOVERNMENT EFFICIENCY SUSTAINABLE COMPETITIVENESS INFRASTRUCTURE RESILIENCE
C M C I C o v e r a g e o v e r t h e y e a r s 1120 1389 1487 122 CITIE S 285 163 MUNICIP 136 CITIE S 535 399 MUNICIP 142 CITIE S 978 MUNICIP 144 CITIES 1245 MUNICIP 2013 2014 2015 2016 Out of 1,634 local governments in the Philippines 145 CITIES 1342 MUNICIP 2017
To view the full rankings go to: www.cmcindex.org.ph
To view the full rankings go to: www.cmcindex.org.ph
Building local competitiveness is critical to enhancing long-term national competitiveness
Ease of Doing Business REGULATORY FOCUS
Doing Business Report: Philippines 2011-2017 1 21 41 61 81 101 121 141 161 181 190 2011 2012 2013 2014 2015 2016 2017 148 136 138 108 95 #20 by 2020 (target) 103 99 Current Philippines Source: Published Doing Business Report
UPGRADES & DOWNGRADES Philippine Rankings (2011-2017) Resolving Insolvency +97 From 153 to 56 Dealing with Construction Permits +71 From 156 to 85 Getting Electricity +32 From 54 to 22 Paying Taxes +11 From 124 to 115 Getting Credit +10 From 128 to 118 Trading Across Borders -34 From 61 to 95 Enforcing Contracts -18 From 118 to 136 Starting a Business -15 From 156 to 171 Registering Property -10 From 102 to 112 Protecting Minority Investors -5 From 132 to 137
PHILIPPINES vs ASEAN (2011-2017) Economy 2017 (190) 2016 (189) 2015 (189) 2014 (189) 2013 (185) 2012 (183) 2011 (183) Change 2016-2017 Change 2011-2017 Singapore 2 1 1 1 1 1 1-1 -1 Malaysia 23 18 18 6 12 18 21-5 -2 Thailand 46 49 26 18 18 17 19 3-27 Brunei Darussalam 72 84 101 59 79 83 112 12 40 Vietnam 82 90 78 99 99 98 78 8-4 Indonesia 91 109 114 120 128 129 121 18 30 Philippines 99 103 95 108 138 136 148 4 49 Cambodia 131 127 135 137 133 138 147-4 16 Lao PDR 139 134 148 159 163 165 171-5 32 Myanmar 170 167 177 182 NDA NDA NDA -3 12 Source: Published Doing Business Report
EODB Improvements Integrated Business Registration System For Starting a Business, registration numbers from the SEC, BIR, SSS, Pag-IBIG, and PhilHealth can be generated in a single transaction at the SEC. Online Access to Building Code and other Requirements for Getting a Construction Permit For Dealing with Construction Permits, requirements for obtaining a building permit under the Building Code are now made accessible online free at www.dpwh.gov.ph/.
EODB Improvements Online Application for Electric Service In Getting Electricity, apply for electric service online through MERALCO (www.meralco.com.ph/apply-now) for both home and business applications in Meralco service area. Terminal Appointment Booking System To address port congestion in Manila, the Terminal Appointment Booking System (TABS) is an electronic platform for booking container movement in international ports of Manila, creating more organized in- and out-flow of containerized cargoes from both terminals.
Reforms in Doing Business SSSnet, Philhealth, Pag-Ibig SSS introduced SSSnet to make filing and payment of social contributions easier. This automates transfer of data and funds and facilitates members access to benefits. Philhealth and Pag-Ibig payments move online. Land Titling Computerization Project For Registering Property, LRA developed the Land Titling Computerization Project to upgrade all manually-issued titles into e-titles. LRA Aksyon-Agad Center One-stop interactive support system that receives inquiries and concerns from the public, and gives updates on status of transactions and complaints at the Land Registration Authority. It also allows the public to report misconduct, corruption, and poor service delivery at the agency.
MAYOR S PERMIT : OLD VS NEW STANDARDS
Nationwide Compliance Rate Revised BPLS Standards Maximum of 2 days or less 72% (1,150) While 28% process it in 2 days or more DAYS / TIME PROCEDURES Maximum of 3 procedures or less 47% (745) While 53% has 4 procedures or more Use of single unified form 79% (1,260) While 19% has used 2 forms or more UNIFIED FORM SIGNATORIES Maximum of 2 signatories or less 79% (1,258) While 21% has 3 or more signatories
SB 1311 : Expanded Anti-Red Tape Act of 2017 HB 5031 : AN ACT ESTABLISHING A NATIONAL POLICY ON EASE OF DOING BUSINESS
Background February 1, 2017, the Senate Committee on Trade, Commerce and Entrepreneurship and Senate Committee on Civil Service, Government Reorganization and Professional Regulation submit Senate Committee Report Number 33 recommending SB 1311 as substitute for SB 866 (Fast Business Permit Act), taking into consideration Senate Resolutions Number 23 (Government Plans and Strategies to Promote Ease of Doing Business in the Country) and 54 (Strengthening the E- Commerce Transactions in Government). Senate Bill No. 1311 approved on Third Reading by Senate, August 22, 2017. HB 5031 Pending with the Committee on Trade and Industry since Feb 2, 2017
OBJECTIVES OF SB 1311, HB 5031 Promotes development of the Micro, Small, and Medium Enterprises (MSME s). To realize freedom from the unjustified cost of doing business and to promote integrity, accountability, proper management of public affairs and property. Adoption of simplified requirements and procedures for business and non-business related transactions Strengthens the Government s Anti-Red Tape Program
KEY FEATURES OF SB 1311, HB 5031 Prescribes processing period of maximum 3 three working days for simple applications involving MSMEs and 7 seven working days for complex applications from the time the application is received. For special types of businesses that require clearances, accreditation and/or licenses issued by government agencies, processing time is set at maximum 20 working days. Automatic approval of application if agency fails to take action (which includes informing applicant of errors, omissions and/or additional documents required for submission) and provided that applicant has complied with all required documents and fees. The bill allows prescribed processing period to be extended once for highly technical applications or such cases where extraordinary due diligence in reviewing the qualifications and merits of an application is required.
KEY FEATURES OF SB 1311, HB 5031 To make the application process for business permits and other documents faster and more convenient, the bill requires national and local agencies to set up an Electronic Business One-Stop Shop (E-BOSS) business permit and licensing system in cities and municipalities nationwide. A single or unified business application form shall be used in processing new applications for business permits and business renewals. New form would consolidate all information of the applicant by various local government departments, such as but not limited to the local taxes and clearances, building clearance, sanitary permit, zoning clearance, and other specific local government unit requirements as the case may be, including the fire clearance from the Bureau of Fire Protection.
SB 1280, HB 0877, HB 1324, HB 2917 AND HB 5970 AN ACT THE CORPORATION CODE OF THE PHILIPPINES
NCC Recommendations Introduction of the One Person Corporation (Section 73). Currently, corporations require five incorporators for registration at the SEC. Simplification of Name Registration. NCC proposes that only identical names be rejected and that applicants otherwise are allowed to proceed with their applications. The process can then be stopped if corporations who own previously-filed names register a complaint against new names.
NCC Recommendations Lifespan of the corporation. NCC supports the proposal that this be extended to perpetuity, unless shortened at the option of the corporation. Abolish the minimum capital requirements for registration. This significantly simplifies the process of incorporation, especially for small businesses and entrepreneurs. Free access to corporate information. NCC recommend free access to corporate information rather than paid access. Online registration. An online system will enable entrepreneurs everywhere to register anytime, anywhere. It will benefit entrepreneurs not only because of speed but also because of access.
PROJECT REPEAL Launched March 2016 Government-wide regulatory reform initiative which aims to repeal outdated rules and reduce the cost of doing business. Mission is to review irrelevant, burdensome, and unnecessary laws/issuances imposed on businesses and citizens that affect the country s global competitiveness ranking and investment climate.
RATIONALE Consumers and Businesses are saddled by too much regulation Regulation happens at Executive, Legislative, Local Government levels Laws date back to Commonwealth period and includes PDs from Martial Law era Multiple layers of laws, rules, regulations Are they all necessary or relevant?
OBJECTIVE Reduce cost of compliance for people and businesses; generate savings
REVIEWING WHAT TO REPEAL Executive Department Orders/Circulars Executive Orders & Administrative Orders Legislation LGU Ordinances*
JOURNEY TO GOOD REGULATORY PRACTICE Repeal Cost Accounting (Quantifying the Savings) Regulatory Impact Assessment (Cost vs Benefit) Better Regulatory Delivery
INCREASED PARTICIPATION FROM NATIONAL GOVERNMENT AGENCIES AND ACADEME
STATUS OF REVIEW Since launch, 4,837 policy issuances have been reviewed. *Removal of invalid rules and regulations from a government website and roster of active issuances.
Government Online BUSINESS-FRIENDLY FOCUS
The Goal File online, anytime, anywhere Pay online License or permit issued electronically, where possible (a la airline tickets).
Getting Started Priority Permits to Take Online or Automate Incorporation : Starting a Business Business (Mayor s) Permits Construction Permits Occupancy Permits BIR and Social Agencies (SSS, Philhealth, Pag- IBIG) Fire Safety Inspection Certificates (FSIC) Import/Export Traderelated National Quality Infrastructure (FDA, BPS, DA) standards and certification
Let s Create Portals Ease of Doing Business - www.business.gov.ph Trade Facilitation - www.tradenet.gov.ph National Quality Infrastructure - www.quality.gov.ph
How? Let private sector develop and own the apps. Pay them per transaction Crowd-sourced app (cheaper, faster than traditional procurement) Hackathon
Benefits to Government Faster, lower development costs Lower hardware costs Quicker turnarounds for upgrades
CAN WE GO FROM THIS?
TO THIS? ONE WINDOW SERVING ALL TRANSACTIONS
TO THIS. CAN WE USE MOBILE PHONES TO GET SOME PERMITS?
THANK YOU Fb.com/compete.philippines www.competitive.org.ph @NCC_ph
gm.luz@ competitive.org.ph