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01/02/2016: PH JUMPS SIX NOTCHES IN HERITAGE FOUNDATION’S 2016 INDEX OF ECONOMIC FREEDOM

PRESS RELEASE
WDC-005-2016
01 February 2016

WASHINGTON, D.C. — The 2016 Index of Economic Freedom released today by the Heritage Foundation reaffirmed economic freedom in the Philippines, and recognized notable success in monetary freedom and management of public finance.

The Philippines improved to 70th place in 2016 from 76th in 2015 in the annual survey of 186 countries published since 1995 by the Heritage Foundation, a Washington-based think-tank.

The 2016 Index continued to grade economies based on 10 independent factors called Economic Freedoms, and the Philippines showed improvements in business freedom (+7.7); freedom from corruption (+2.0); and trade freedom (+1.0).

The Philippines achieved an Economic Freedom Score of 63.1 out of a possible 100, which is above the global and regional averages. The Philippines ranked 14th among the countries in the Asia-Pacific that were surveyed.

“The Philippines welcomes the release of the 2016 Index of Economic Freedom. Its improvement by another six notches in the global ranking this year captures the sense of endless possibilities and potential that imbue the Philippine economy today under the leadership of the President, the steady and prudent economic management of the economic managers, as well as the leadership and hard work of the rest of the Cabinet, who have restored our government agencies to professionalism and institutional integrity,” said Philippine Ambassador Jose L. Cuisia, Jr.

In the report, the Heritage Foundation observed that “the Philippine economy has been growing steadily at an average annual rate above 6 percent for the past five years. The government has pursued legislative reforms to enhance the entrepreneurial environment and develop a more vibrant private sector to generate broader-based job growth.”

While noting the problems of poor infrastructure, lingering institutional challenges, and the lack of dependable enforcement of the law, the Heritage Foundation also highlighted a number of positive developments. It recognized that public debt has been maintained below 40 percent of GDP, and budget deficits were controlled. The time involved in dealing with licensing requirements for new business has been notably reduced, and the cost of completing them has been cut. It also said that the financial sector, which is gradually modernizing, remains relatively stable and sound.

The Index measures economic freedom based on 10 quantitative and qualitative factors grouped under four broad categories or pillars—rule of law, limited government, regulatory efficiency, and open markets.

Based on an aggregated score, each of the 186 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).

In previous years, the Philippines was under the “mostly unfree,” but it has returned to the “moderately free” category during the Aquino administration.

Ambassador Cuisia again thanked the Heritage Foundation for its transparency and objectivity in receiving information and data from the Embassy and other Philippine agencies.

“The Philippine Government will continue to work closely with the Heritage Foundation in ensuring that its annual survey reflects the key developments that are actually affecting economic freedom in the country,” he added. ###