Philippine ranks high in UK think tank’s prosperity index

Of 149 countries in the world, the Philippines is the 60th most prosperous, based on the criteria of Brit­ish think tank Legatum In­stitute in its yearly ranking called the Prosperity Index.

The Philippines was sandwiched between Ecuador at 59th and Indonesia at 61st.

In Asia-Pacific, the Philip­pines was the 9th most pros­perous based on the rank­ing. Within the Association of Southeast Asian Nations (Asean), only Singapore, 19th overall; and Malaysia, 38th overall were better placed.

Based on the Prosper­ity Index the Philippines scored high in social capi­tal (21st), natural environ­ment (44th), and governance (62nd). However, it fared poorly in economic quali­ty (69th), health (98th), and safety and security (141st).

The index’s rankings are not based solely on wealth.

“Prosperity is as much about well-being as it is about wealth.

There are numerous factors that together determine the life chances and opportuni­ties made available to a nation’s citizens,” the think tank said.

Strong performance in the social capital and per­sonal freedom sub-indices, coupled with a more com­petitive economy, has helped the Philippines rise 17 ranks from last year in the index to rank 60th, the report noted.

Momentum has come from a bullish economy, thanks to upgraded infra­structure and improved gov­ernance, the report said.

Legatum said the Philip­pines was “long deemed an inefficient economy lagging behind its neighboring South­east Asian tiger economies.”

It added, however, that the Philippines has rapid­ly improved the compet­itiveness of its economy and has begun to catch up.

“In a region where it is not unusual to prioritize economic growth over the preservation of individual freedoms, the Phil­ippines had carved out its own definition of prosperity with­out sacrificing its economic dynamism,” the report noted.

It said that while con­solidating personal freedom gains, particularly high with­in the region, the Philippines has taken lessons from its neighbors on how to ener­gize its business environment with large infrastructure proj­ects and making itself attrac­tive to foreign investment.

“Such improvements have been made far easier by more effective and democratic gov­ernance and close societal ties,” it said.

“The country has nearly doubled its prosperity surplus over the past decade, to be one of the highest in Southeast Asia,” Legatum said.

It noted that open-mind­ed business policies and pro­tection of individual freedoms in the country were rewarded with years of steady econom­ic growth and one of the big­gest prosperity surplus among Southeast Asian countries.

The Philippines has climbed 36 ranks in the Busi­ness Environment sub-index to rank 62nd, thanks to rapidly improving internet infrastruc­ture and insolvency proce­dures, and falling redundancy and electricity costs, it added. “This market improve­ment is underscored by strong levels of social capital and per­sonal freedom. However, stub­born poverty levels and a bleak security situation threaten the country’s rising prosperity,” the report said.

Ranked 58th in the per­sonal freedom sub-index, the Philippines has been the fre­est country in Southeast Asia throughout the last decade. “A liberalized political and social culture helps with one of the world’s highest level of satisfaction with freedom of choice with 91 percent of Fil­ipinos giving a positive answer in 2015,” it added.

Growing economic oppor­tunity, coupled with a subsid­ence in conflict with insurgents in the Muslim-majority south explains the rise in the propor­tion of people saying the coun­try a good place for immigrants and ethnic minorities to live. “Though civil union be­tween same sex is yet to be ac­knowledged by the law, LGBT groups are much wider ac­cepted by the society. All these point to an increasingly free and tolerant society,” it added.

The think tank considers four countries that it called VIPPs (Vietnam, Indonesia, the Philippines, and Poland) as showing the most prom­ise since these countries per­formed “solidly” in education, governance, and social capital. It said the VIPPs show more potential than the BRICs (Brazil, Russia, India, and Chi­na) in driving global prosperity. “Together, the VIPPs ac­count for 6.6 percent of the world’s total population… As they are home to such large populations, growth in the prosperity of the VIPPs is growth in the prosperity of hundreds of millions of peo­ple worldwide,” Legatum said. Similarly, it said the Phil­ippines was among the “bright stars” of Southeast Asian pros­perity. The country is grouped with Cambodia, Indonesia, and Vietnam.

“These countries have in common increasingly compet­itive economies and business environments, like many Asian countries, but crucially also greater delivery of prosperity across key structural areas like governance, personal freedom, and social capital,” Legatum added.

New Zealand, Norway, Finland, Switzerland, and Can­ada were the top 5 most pros­perous countries. Legatum said New Zealand has “a com­bination of strong society, free and open markets, and high levels of personal freedom.” At the bottom list were Yemen (149th), Afghanistan, the Central African Republic, Sudan, and the Democratic Republic of Congo (145th). The report said strong social capital is another se­cret to the Philippines’s ro­bust prosperity delivery. “Just shy of the top 20 in 2016, the Philippines can boast of a world-class performance in measurements related to so­cial linkage.

The natural hospitality and friendliness of the Filipinos are reflected in the country’s social capital score, with nine out of every 10 satisfied with the op­portunity to make new friends and feeling that they are treated with respect,” the report said. Without a developed so­cial safety net, strong family ties are important – more than four fifths of the population believe they can rely on family or friends in difficult times, it said.

“Beyond close personal networks, social bonds in gen­eral are also markedly high, nearly half of Filipinos volun­teered in some way. This in part explains the country’s swift re­covery from one of the worst hurricanes it has suffered that hit in 2014,” the report added. “The Philippines has sky­rocketed by 52 ranks in Busi­ness Environment since 2009 and its economy, long reliant on remittances and tourism, has found new growth from a developing manufacturing in­dustry,” it said.

The Philippines has made progress in both the ease of getting credit and the ease of resolving insolvency, which was once one of the worst in the world, the report added.

The report said the labor market has grown more flex­ible, and electricity costs are falling.

“Nevertheless, formida­ble tasks lie ahead if prosper­ity growth is to continue. To start with, the country’s econ­omy is still in urgent need of development and the popula­tion, in particular rural resi­dents, are craving economic opportunity,” the report said. Despite recent improve­ments, poverty is endemic. Around 13 percent of the population still live on less than $1.90 per day, it said. “Poverty-reduction ef­forts have been hit by a 7-percent unemployment rate and a lack of access to financial services. Fewer than one in three Filipinos hold an account in a bank or other financial institution, a sig­nificant limit on meaningful economic transition,” it add­ed. LUIS LEONCIO