competitiveness in s&t and innovation in the philippines

KICKSTART STARTUP MIXER Competitiveness in Science & Technology and Innovation

GUILLERMO M. LUZ Private Sector Co-‐Chairman March 27, 2014

www.compe((ve.org.ph

Source: World Bank

0

5,000

10,000

15,000

20,000

25,000

1982

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Foreign Direct Investments, net inflows (US$ millions)

Indonesia

Malaysia

Thailand

Vietnam

Philippines

Why does it matter?

Source: World Bank

0

2,000

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12,000

1982

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GDP per capita (US$)

Malaysia

China

Thailand

Indonesia

Vietnam

Cambodia

Philippines

Why does it matter?

REPORT 2014 RANK

2013 RANK

2012 RANK

2011 RANK CHANGE ASEAN NEXT

REPORT SOURCE TARGET

1. WEF Global CompeSSveness Index 59/148 65/144 75/142 ↑ 6 6 of 10 Sep-‐14 WEF 49

2. IFC Ease of Doing Business 108/189 138/185 136/183 ↑ 30 6 of 10 Oct-‐14 IFC 63

3. IMD World CompeSSveness Report 38/60 43/59 41/59 ↑ 5 4 of 5 May-‐1

4 IMD 20

4. TI CorrupSon PercepSon Index 94/177 105/179 129/183 ↑ 11 4 of 10 Dec-‐13 Transparency InternaSonal 60

5. Economic Freedom Index 89/178 97/177 107/179 115/179 ↑ 8 5 of 7 Jan-‐14 Heritage FoundaSon 59 6. Global InformaSon Technology Report 86/144 86/142 86/138 no

change 7 of 8 Apr-‐14 WEF 47

7. Travel and Tourism Report 82/140 n/a 94/139 ↑ 12 7 of 8 Mar-‐15 WEF 46

8. Global InnovaSon Index 90/142 95/141 91/125 ↑ 5 7 of 9 Jul-‐14 WIPO 47

9. LogisScs Performance Index 57/160 -‐-‐ 52/155 44/155 ↓ 5 4 of 9 Feb-‐14 World Bank 51

10. Failed States Index 59/178 56/177 51/177 ↑ 3 7 of 10 Jun-‐14 Fund for Peace 118

Global Competitiveness Report Card

***As of March 2014

REPORT CHANGE 2013 VS

2012 CHANGE OVER 3

YEARS

1. World Economic Forum Global Compe((veness Index + 6 + 26

2. IFC/WB Ease of Doing Business Report + 30 + 28

3. IMD World Compe((veness Report +5 +3

4. Transparency Interna(onal Corrup(on Percep(ons Index +11 +35

5. Economic Freedom Index +10 +18 6. Global IT Report (WEF) 0 0 7. Travel and Tourism Report (WEF) +12 +12 8. Global Innova(on Index +5 +17

Global Competitiveness Performance

Innovation

•  FoundaSon of an empowered and compeSSve naSon

•  Drives economic growth •  New source of high-‐value added jobs •  No longer restricted to R&D laboratories or scienSfic papers -‐ includes social innovaSons and business model innovaSons

•  Spurred by a good business environment Sources: Doing Business 2014: Understanding Regula;ons for Small and Medium-‐Size Enterprises The Global Informa;on Technology Report 2013: Growth and Jobs in a Hyperconnected World The Global Innova;on Index 2013: The Local Dynamics of Innova;on

Global Information Technology Report: Philippines VS ASEAN

Economy 2013 Rank out of 144

2012 Rank out of 142


CHANGE over 2 years

1. SINGAPORE 2 2 2 0 2. MALAYSIA 30 29 28 -‐2 3. BRUNEI DARUSSALAM 57 54 57 0 4. THAILAND 74 77 59 -‐15 5. INDONESIA 76 80 53 -‐23 6. VIETNAM 84 83 55 -‐29 7. PHILIPPINES 86 86 86 0 8. CAMBODIA 106 108 111 +5

Global Information Technology Report 2013: Philippines VS ASEAN

PILLARS PHILIPPINES

BRUNEI

DARU

SSAL

AM

CAMBO

DIA

INDO

NESIA

MAL

AYSIA

SINGAP

ORE

THAILA

ND

VIETNAM

1. Poli(cal and regulatory environment 8 of 8 98 45 65 82 24 1 81 85

2. Business and innova(on environment 7 of 8 100 77 91 73 16 1 52 108

3. Infrastructure and digital content 5 of 8 84 50 87 89 73 19 71 114

4. Affordability 6 of 8 82 135 112 39 50 55 45 38 5. Skills 5 of 8 73 31 109 63 43 2 76 79 6. Individual usage 7 of 8 95 49 112 92 46 11 88 78 7. Business usage 4 of 8 47 59 70 40 26 14 63 88 8. Government usage 6 of 8 67 33 103 58 7 1 86 62 9. Economic Impacts 4 of 8 56 48 124 101 29 2 108 89 10. Social impacts 7 of 8 76 35 101 72 25 1 67 64

Global Information Technology Report: Philippines 2011-2013

Indicators 2013 2012 2011 change over 2 years

1st Pillar : PoliScal and regulatory environment 1.01 EffecSveness of law-‐making bodies* 93 112 119 26 1.02 Laws relaSng to ICT* 66 84 85 19 1.03 Judicial independence* 99 102 110 11 1.04 Efficiency of legal system in seiling disputes* 107 115 121 14 1.05 Efficiency of legal system in challenging regulaSons* 102 118 115 13 1.06 Intellectual property protecSon* 87 102 102 15 1.07 Sojware piracy rate, % sojware installed 70 68 68 -‐2 1.08 No. procedures to enforce a contract 68 69 65 -‐3 1.09 No. days to enforce a contract 121 119 117 -‐4



2nd Pillar : Business and innovaSon environment 2.01 Availability of latest technologies* 56 62 62 6 2.02 Venture capital availability* 62 71 75 13 2.03 Total tax rate, % profits 104 100 89 -‐15 2.04 No. days to start a business 118 112 110 -‐8 2.05 No. procedures to start a business 142 136 129 -‐13 2.06 Intensity of local compeSSon* 50 47 -‐ -‐3 2.07 TerSary educaSon gross enrollment rate, % 79 76 76 -‐3 2.08 Quality of management schools* 39 55 -‐ 16 2.09 Gov’t procurement of advanced technology* 107 126 128 21



3rd Pillar : Infrastructure and digital content 3.01 Electricity producSon, kWh/capita 105 104 105 0 3.02 Mobile network coverage, % populaSon 51 49 48 -‐3 3.04 InternaSonal Internet bandwidth, kb/s per user 77 71 102 25 3.05 Secure Internet servers/million pop 97 95 91 -‐6 3.06 Accessibility of digital content* 74 80 -‐ 6 4th Pillar : Affordability 4.01 Mobile cellular tariffs, PPP $/min 73 65 54 -‐19 4.02 Fixed broadband Internet tariffs, PPP $/month 95 86 -‐ -‐9 4.03 Internet & telephony compeSSon, 0–2 (best) 1 1 -‐ 0



5th Pillar : Skills 5.01 Quality of educaSonal system* 45 61 68 23 5.02 Quality of math & science educaSon* 98 115 111 13 5.03 Secondary educaSon gross enrollment rate, % 84 79 -‐ -‐5 5.04 Adult literacy rate, % 61 60 67 6 6th Pillar : Individual usage 6.01 Mobile phone subscripSons/100 popn 84 93 62 -‐22 6.02 Individuals using Internet, %. 91 92 106 15 6.03 Households with personal computer, % 97 100 87 -‐10 6.04 Households with Internet access, % 91 89 -‐ -‐2 6.05 Broadband Internet subscripSons/100 popn 92 89 85 -‐7 6.06 Mobile broadband subscripSons/100 popn 94 80 -‐ -‐14 6.07 Use of virtual social networks* 27 41 46 19



7th Pillar : Business usage 7.01 Firm-‐level technology absorpSon* 46 52 58 12 7.02 Capacity for innovaSon* 86 95 80 -‐6 7.03 PCT patents, applicaSons/million populaSon 80 84 -‐ 4 7.04 Business-‐to-‐business Internet use* 51 89 -‐ 38 7.05 Business-‐to-‐consumer Internet use* 51 -‐ -‐ 0 7.06 Extent of staff training* 32 34 45 13

8th Pillar : Government usage 8.01 Importance of ICTs to government vision* 85 100 106 21 8.02 Government Online Service Index, 0–1 (best) 67 48 48 -‐19 8.03 Government success in ICT promoSon* 71 -‐ 105 34



9th Pillar : Economic Impacts 9.01 Impact of ICT on new services and products* 43 68 80 37 9.02 ICT PCT patents, applicaSons/million populaSon 74 76 -‐ 2 9.03 Impact of ICTs on new organizaSonal models* 33 60 77 44 9.04 Knowledge-‐intensive jobs, % workforce 72 73 -‐ 1 10th Pillar : Social impacts 10.01 Impact of ICTs on access to basic services* 79 106 96 17 10.02 Internet access in schools* 73 73 76 3 10.03 ICT use & government efficiency* 83 103 113 30 10.04 E-‐ParScipaSon Index, 0–1 (best) 62 62 62 0

Global Innovation Index: Philippines VS ASEAN

Country 2013 Rank out of 142



CHANGE over 3 years

1. SINGAPORE 8 3 3 -‐5 2. MALAYSIA 32 32 31 -‐1 3. THAILAND 57 57 48 -‐9 4. BRUNEI DARUSSALAM 74 53 75 +1 5. VIETNAM 76 76 51 -‐25 6. INDONESIA 85 100 99 14 7. PHILIPPINES 90 95 91 +1 8. CAMBODIA 110 129 111 +1 9. LAOS -‐ 138 -‐

Global Innovation Index 2013: Philippines VS ASEAN

Indicator PHILIPPINES

SINGAP

ORE

MAL

AYSIA

THAILA

ND

BRUNEI

VIETNAM

INDO

NESIA

CAMBO

DIA

1. Ins(tu(ons 7 of 8 128 7 49 93 34 122 138 116 2. Human capital & research 7 of 8 116 3 40 46 65 98 99 131

3. Infrastructure 5 of 8 78 6 33 60 55 80 82 116 4. Market sophis(ca(on 7 of 8 95 5 23 37 84 73 99 93

5. Business sophis(ca(on 6 of 8 96 1 27 60 86 67 112 102

6. Knowledge & technology outputs 5 of 8 61 11 24 53 125 51 81 94

7. Crea(ve outputs 7 of 8 91 40 38 76 51 66 57 99

Global Innovation Index: Philippines 2011-2013

Indicator 2013 2012 2011 change over 2 years

1 InsStuSons 1.1 PoliScal environment 120 121 110 -‐10 1.1.1 PoliScal stability 130 134 113 -‐17 1.1.2 Government effecSveness 68 72 73 5 1.1.3 Press freedom 118 114 113 -‐5 1.2 Regulatory environment 118 116 79 -‐39 1.2.1 Regulatory quality 93 90 72 -‐21 1.2.2 Rule of law 98 97 88 -‐10 1.2.3 Cost of redundancy dismissal, salary weeks 122 120 -‐ -‐ 1.3 Business environment 132 133 97 -‐35 1.3.1 Ease of starSng a business 125 127 -‐ -‐ 1.3.2 Ease of resolving insolvency 139 136 -‐ -‐ 1.3.3 Ease of paying taxes 111 95 -‐ -‐



2 Human capital & research 2.1 EducaSon 134 135 116 -‐18 2.1.1 Current expenditure on educaSon, % GNI 103 119 109 6 2.1.2 Public expenditure/pupil, % GDP/cap 107 110 101 -‐6 2.1.3 School life expectancy, years 100 94 80 -‐20 2.1.4 PISA scales in reading, maths, & science -‐ -‐ -‐ -‐ 2.1.5 Pupil-‐teacher raSo, secondary 124 126 116 -‐8 2.2 TerSary educaSon 91 87 69 -‐22 2.2.1 TerSary enrolment, % gross 78 75 68 -‐10 2.2.2 Graduates in science & engineering, % 27 30 -‐ -‐ 2.2.3 TerSary inbound mobility, % 104 90 -‐ -‐ 2.2.4 Gross terSary outbound enrolment, % 136 139 108 -‐28 2.3 Research & development (R&D) 67 120 113 46 2.3.1 Researchers, headcounts/mn pop 88 94 82 -‐6 2.3.2 Gross expenditure on R&D, % GDP 95 96 82 -‐13 2.3.3 QS university ranking, average score top 3 44 -‐ -‐ -‐



3 Infrastructure 3.1 InformaSon & communicaSon technologies (ICTs) 86 80 78 -‐8 3.1.1 ICT access 98 96 79 -‐19 3.1.2 ICT use 97 78 88 -‐9 3.1.3 Government’s online service 67 67 47 -‐20 3.1.4 E-‐parScipaSon 64 63 62 -‐2 3.2 General infrastructure 101 112 112 11 3.2.1 Electricity output, kWh/cap 98 101 93 -‐5 3.2.2 Electricity consumpSon, kWh/cap 101 102 96 -‐5 3.2.3 LogisScs performance 52 -‐ -‐ -‐ 3.2.4 Gross capital formaSon, % GDP 82 87 113 31 3.3 Ecological sustainability 53 29 -‐ -‐ 3.3.1 GDP/unit of energy use, 2000 PPP$/kg oil eq 35 6 -‐ -‐ 3.3.2 Environmental performance 41 41 -‐ -‐ 3.3.3 ISO 14001 environmental cerSficates/bn PPP$ GDP 51 74 -‐ -‐



4 Market sophisScaSon 4.1 Credit 128 120 108 -‐20 4.1.1 Ease of getng credit 110 104 -‐ -‐ 4.1.2 DomesSc credit to private sector, % GDP 95 94 -‐ -‐ 4.1.3 Microfinance gross loans, % GDP 52 53 43 -‐9 4.2 Investment 68 89 76 8 4.2.1 Ease of protecSng investors 113 110 -‐ -‐ 4.2.2 Market capitalizaSon, % GDP 20 27 40 20 4.2.3 Total value of stocks traded, % GDP 36 45 48 12 4.2.4 Venture capital deals/tr PPP$ GDP 64 63 50 -‐14 4.3 Trade & compeSSon 52 74 65 13 4.3.1 Applied tariff rate, weighted mean, % 77 76 60 -‐17 4.3.2 Non-‐agricultural mkt access weighted tariff, % 59 81 -‐ -‐ 4.3.3 Intensity of local compeSSon 50 45 62 12



5 Business sophisScaSon 5.1 Knowledge workers 73 62 47 -‐26 5.1.1 Knowledge-‐intensive employment, % 59 69 67 8 5.1.2 Firms offering formal training, % firms 61 61 53 -‐8 5.1.3 R&D performed by business, % GDP 63 26 22 -‐41 5.1.4 R&D financed by business, % 8 12 13 5 5.1.5 GMAT mean score 41 52 -‐ -‐ 5.1.6 GMAT test takers/mn pop. 20–34 119 119 -‐ -‐ 5.2 InnovaSon linkages 87 70 70 -‐17 5.2.1 University/industry research collaboraSon 77 80 78 1 5.2.2 State of cluster development 44 54 57 13 5.2.3 R&D financed by abroad, % 63 66 51 -‐12 5.2.4 JV–strategic alliance deals/tr PPP$ GDP 41 28 10 -‐31 5.2.5 Patent families filed in 3+ offices/bn PPP$ GDP 65 -‐ -‐ -‐ 5.3 Knowledge absorpSon 105 79 68 -‐37 5.3.1 Royalty & license fees payments, % service imports 40 -‐ -‐ -‐ 5.3.2 High-‐tech imports less re-‐imports, % -‐ -‐ -‐ -‐ 5.3.3 Computer & comm. service imports, % 72 91 82 10 5.3.4 FDI net inflows, % GDP 125 113 92 -‐33



6 Knowledge & technology outputs 6.1 Knowledge creaSon 81 102 92 11 6.1.1 DomesSc resident patent ap/bn PPP$ GDP 81 82 72 -‐9 6.1.2 PCT resident patent ap/bn PPP$ GDP 82 92 72 -‐10 6.1.3 DomesSc res uSlity model ap/bn PPP$ GDP 21 22 21 0 6.1.4 ScienSfic & technical arScles/bn PPP$ GDP 133 125 114 -‐19 6.1.5 Citable documents H index 54 -‐ -‐ -‐ 6.2 Knowledge impact 70 94 102 32 6.2.1 Growth rate of PPP$ GDP/worker, % 48 25 43 -‐5 6.2.2 New businesses/th pop. 15–64 92 91 84 -‐8 6.2.3 Computer sojware spending, % GDP 59 70 70 11 6.2.4 ISO 9001 quality cerSficates/bn PPP$ GDP 72 88 -‐ -‐ 6.2.5 High-‐ & medium-‐high-‐tech manufactures, % 11 -‐ -‐ -‐ 6.3 Knowledge diffusion 42 26 26 -‐16 6.3.1 Royalty & license fees receipts, % service exports 96 -‐ -‐ -‐

6.3.2 High-‐tech exports less re-‐exports, % -‐ -‐ -‐ -‐ 6.3.3 Comm., computer & info. services exports, % 22 -‐ -‐ -‐ 6.3.4 FDI net ouvlows, % GDP 105 68 70 -‐35



7 CreaSve outputs 7.1 Intangible assets (formerly CreaSve intangibles) 52 94 77 25 7.1.1 DomesSc res trademark reg/bn PPP$ GDP 65 62 58 -‐7 7.1.2 Madrid resident trademark reg/bn PPP$ GDP -‐ -‐ -‐ -‐ 7.1.3 ICT & business model creaSon 42 58 73 31 7.1.4 ICT & organizaSonal model creaSon 31 96 71 40 7.2 CreaSve goods & services 120 117 86 -‐34 7.2.1 Audio-‐visual & related services exports, % 42 -‐ -‐ -‐ 7.2.2 NaSonal feature films/mn pop. 15–69 67 59 47 -‐20 7.2.3 Paid-‐for dailies, circulaSon/th pop. 15–69 75 72 -‐ -‐ 7.2.4 PrinSng & publishing manufactures, %. 84 -‐ -‐ -‐ 7.2.5 CreaSve goods exports, %. -‐ 70 60 -‐ 7.3 Online creaSvity 92 84 -‐ -‐ 7.3.1 Generic top-‐level domains (TLDs)/th pop. 15–69 92 94 -‐ -‐ 7.3.2 Country-‐code TLDs/th pop. 15–69 96 92 -‐ -‐ 7.3.3 Wikipedia monthly edits/mn pop. 15–69 86 77 -‐ -‐ 7.3.4 Video uploads on YouTube/pop. 15–69 74 68 -‐ -‐

World Bank-‐Interna(onal Finance Corpora(on DOING BUSINESS REPORT •  Tracks the ease of doing business across 10 important processes or transacSons which any business must undertake with government

ECONOMY 2014 Rank out of 189

2013 Rank out of 185 CHANGE

1 Philippines 108 138 30

2 Ukraine 112 137 25

3 Rwanda 32 52 20

4 Brunei Darussalam 59 79 20

5 Russian FederaSon 92 112 20

6 Burundi 140 159 19

7 Guatemala 79 93 14

8 Brazil 116 130 14

9 Iraq 151 165 14

10 Kosovo 86 98 12

2014 Most Improved: EASE OF DOING BUSINESS

ASEAN 2014 Rank out of 189


CHANGE 2012 Rank out of 183

CHANGE

1. SINGAPORE 1 1 0 1 0 2. MALAYSIA 6 12 +6 14 +2 3. THAILAND 18 18 0 17 -‐1 4. BRUNEI DARUSSALAM 59 79 +20 83 +4 5. VIETNAM 99 99 0 99 0 6. PHILIPPINES 108 138 +30 136 -‐2 7. INDONESIA 120 128 +8 130 +2 8. CAMBODIA 137 133 -‐4 141 +8 9. LAO PDR 159 163 +4 166 +3 10. MYANMAR 182 -‐ 0 -‐ 0

Doing Business Report: Philippines VS ASEAN

100

90

80

70

60

50

40

30

20

10

0 2009 2010 2011 2012 2013 2014 2015 2016

UPPER 1/3

MIDDLE 1/3

BOTTOM 1/3

Doing Business Report: 2009-2014

INDICATORS 2014 Rank out of 189

CHANGE 2013-‐2014



1. StarSng a business 170 -‐9 161 158 2. Dealing with construcSon permits 99 +1 100 101

3. Getng electricity 33 +24 57 53 4. Registering Property 121 +1 122 120 5. Getng Credit 86 +43 129 127 6. ProtecSng Investors 128 0 128 124 7. Paying Taxes 131 +12 143 136 8. Trading across borders 42 +11 53 56 9. Enforcing contracts 114 -‐3 111 109 10. Resolving Insolvency 100 +65 165 166

Doing Business Report: By Indicator

16 STEPS

36 DAYS

F ROM :

Starting a Business

2012 Baseline

TO :

11 STEPS

11 DAYS

Starting a Business

2013 Reform

START

Deposit paid-‐up capital and obtain bank cerSficate.

Notarize arScles of incorporaSon and treasurer's

affidavit.

Verify and reserve company name

with SEC.

Register the company with SEC and receive pre-‐registered TIN.

Obtain barangay clearance.

Pay annual community tax and obtain community tax cerSficate.

Obtain business

permit from BPLO.

Apply and pay for CerSficate of RegistraSon and obtain TIN at BIR.

Pay registraSon fee and

documentary stamp taxes

Obtain authority to print receipts and invoices from BIR.

Buy special books of account at bookstore.

Print receipts and

invoices.

Have books of accounts and Printer's CerSficate of Delivery stamped by

BIR.

Register with SSS.

Register with

PhilHealth.

Register with

Pag-‐IBIG. END

Starting a Business

START



affidavit.


with SEC.




Obtain business

permit from BPLO.







BIR. END Register

with SSS. Register with

PhilHealth.

Register with Pag-‐IBIG.

Print receipts and

invoices.

Starting a Business

START



affidavit.


with SEC.



Obtain business

permit from BPLO.







BIR.

Register with SSS.

Register with

PhilHealth.

Register with Pag-‐IBIG.

END Register with

SSS, PhilHealth,

and Pag-‐IBIG.

Print receipts and

invoices.

Pay annual tax and obtain community tax cerSficate and business permit.

Buy special books of account and have books of accounts and Printer's CerSficate of Delivery

stamped by BIR.


Starting a Business

START



affidavit.


with SEC.




Obtain business

permit from BPLO.






Print receipts and

invoices.


BIR.

Register with SSS.

Register with

PhilHealth.

Register with

Pag-‐IBIG. END

Starting a Business 15 steps / 35 days

Accepted

ECONOMY PROCEDURES (NUMBER) TIME (DAYS)

COST (% OF INCOME PER CAPITA)

PAID-‐IN MIN. CAPITAL (% OF INCOME PER CAPITA)

RANK

1 Singapore 3 3 0.6 -‐ 3 *2 Malaysia 3 6 7.6 -‐ 16 3 Lao PDR 6 92 6.7 -‐ 85

4 Thailand 4 28 6.7 0.0 91

5 Vietnam 10 34 7.7 -‐ 109

6 Brunei Darussalam 15 101 9.9 -‐ 137

7 Philippines 15 35 18.7 4.6 170 8 Indonesia 10 48 20.5 38.5 175

9 Cambodia 11 104 150.6 27.5 184

10 Myanmar 11 72 176.7 7,016.0 189

Starting a Business Benchmark: Malaysia

GAMEPLAN 2.0

INDICATOR 2014 REPORT 2015 REPORT MOVEMENT /

CHANGE IN RANK

Number of Days 35 6 -‐29 days Number of Steps 15 3 -‐12 steps Cost (% income/per capita) 18.7 18.7 -‐-‐ Min Paid In Capital 4.6 0 -‐4.6 Effect in indicator ranking 170 30 ↑ 140

Effect in world ranking 108 85 ↑ 23

RECOMMENDATION AGENCY •  Reduce number of days and steps •  Reduce cost •  Implement Online Business RegistraSon •  Consider removing Min. Paid in Capital

SEC, QC, SSS, PBR, BIR, Philhealth, Pag-‐ibig SEC/Congress

Starting a Business Score Simulation

3 STEPS

“3” DAYS

L E A P F R O G :

Starting a Business

20XX

START

END

LGU Steps {Barangay clearance +

Community Tax CerSficate (CTC)

+ Mayor’s Permit}

Review + Consent + Pay

(with submission of notarized

documents to follow within 7 days or enSre process is invalidated)

Register the company with SEC + BIR + SSS +

Philhealth + Pag-‐Ibig

(all in one form and online transacSon)

NaSonal Government

Local Government

Starting a Business

3 s t e p s , 3 d a y s

F ROM :

Paying Taxes

2012 Baseline

47 PAYMENTS

TO :

Paying Taxes

2013 Reform

14 PAYMENTS

ECONOMY PAYMENTS (NUMBER)

TIME (HOURS)

TOTAL TAX RATE (% PROFIT)

EASE OF TAXES RANK

1 Singapore 5 82 27.1 5 2 Brunei Darussalam 27 96 16.1 20 *3 Malaysia 13 133 36.3 36 4 Cambodia 40 173 21.4 65 5 Thailand 22 264 29.8 70 6 Myanmar 31 155 48.9 107 7 Lao PDR 34 362 26.8 119 8 Philippines 36 193 44.5 131 9 Indonesia 52 259 32.2 137 10 Vietnam 32 872 35.2 149

Paying Taxes Benchmark: Malaysia

GAMEPLAN 2.0

INDICATOR 2014 REPORT 2015 REPORT MOVEMENT/ CHANGE IN RANK

Number of Payments 36 13 23 Number of Hours 193 193 -‐-‐ Total Tax Rate 44.5 44.5 -‐-‐ Effect in indicator ranking 131 80 ↑ 51

Effect in world ranking 108 103 ↑ 5

RECOMMENDATION AGENCY •  Reduce number of payments •  Reduce number of Hours •  Consider reducing tax rate

PAG-‐IBIG, PHILHEALTH, BIR

Paying Taxes Score Simulation

Scenarios:

•  Low Hanging Fruit -‐ Impact of FULL implementaSon of Doing Business 2013 reform inventory.

•  Big Impact Indicators – Implement reforms on 4 idenSfied Gameplan 2.0 big impact indicators (StarSng a Business, Registering Property, Getng Credit, ProtecSng Investors).

•  Stretch Targets – Implement suggested reforms for all indicators.

The Results

Impact of FULL implementaSon of Doing Business 2013 reform inventory on 8 indicators (StarSng a business, Dealing with ConstrucSon Permits, Registering Property, Getng Electricity, Getng Credit, ProtecSng Investors, Paying Taxes and Trading Across Borders)

108 39 ↑ 69 2014 2 0 15 I NCREASE

I N RANK

Low Hanging Fruit

ECONOMY 2014 REPORT RANK AS OF CURRENT

DATA AND SIMULATION

1 Singapore 1 1 2 Malaysia 6 6 3 Thailand 18 18

*4 Philippines 108 39 5 Brunei Darussalam 59 59 6 Vietnam 99 99

7 Indonesia 120 120 8 Cambodia 137 137 9 Lao PDR 159 159 10 Myanmar 182 182

mov

e fr

om 6

to

4 Low Hanging Fruit:

New ASEAN Rank

Implement reforms in 4 idenSfied GAMEPLAN 2.0 big impact indicators (StarSng a Business, Registering Property, Getng Credit, ProtecSng Investors).

108 29 ↑ 79 2014 2 0 15 I NCREASE

I N RANK

Big Impact Indicators

ECONOMY 2014 REPORT RANK AS OF CURRENT DATA AND SIMULATION

1 Singapore 1 1

2 Malaysia 6 6

3 Thailand 18 18

*4 Philippines 108 29

5 Brunei Darussalam 59 59

6 Vietnam 99 99

7 Indonesia 120 120

8 Cambodia 137 137

9 Lao PDR 159 159

10 Myanmar 182 182

mov

e fr

om 6

to

4 Big Impact Indicators:

New ASEAN Rank

Implement suggested reforms in ALL indicators based on the GAMEPLAN 2.0 benchmarks.

108 7 ↑ 101 2014 2 0 x x I NCREASE

I N RANK

Stretch Targets

ECONOMY 2014 REPORT RANK AS OF CURRENT DATA AND SIMULATION

1 Singapore 1 1 2 Malaysia 6 6 3 Philippines 108 7 4 Thailand 18 18 5 Brunei Darussalam 59 59 6 Vietnam 99 99

7 Indonesia 120 120 8 Cambodia 137 137 9 Lao PDR 159 159 10 Myanmar 182 182

mov

e fr

om 6

to

3 Stretch Targets:

New ASEAN Rank

Innovation Hubs •  Local hubs and clusters of universiSes, companies, specialized suppliers, service providers, and associated insStuSons foster innovaSon by pooling talent, know-‐how, research labs, and manufacturing capabiliSes in a small area Source: The Global Innova;on Index 2013: The Local Dynamics of Innova;on

Innovation Hubs for Local Competitiveness

•  Building block for naSonal compeSSveness •  Establish mulSple economic, urban centers •  Provide opSons for investors to locate and for Filipinos to choose where to live and work

Benefits of Creating Competitive Regions •  DiversificaSon of investment and job opportuniSes

•  CreaSon of new wealth •  Growing middle class in different parts of the country

•  Overall airacSveness of the country as an investment site

15 Regional Competitiveness Committees + National Capital Region

•  Region I (Ilocos) •  Region II (Cagayan) •  Region III (Central Luzon) •  Region IVA (CALABARZON) •  Region IVB (MIMAROPA) •  Region V (Bicol) •  Region VI (Western

Visayas) •  Region VII (Central Visayas

•  Region VIII (Eastern Visayas) •  Region IX (Zamboanga) •  Region X (Northern Mindanao) •  Region XI (Davao) •  Region XII (SOCCSKSARGEN) •  Region XIII (CARAGA) •  Cordillera AdministraSve Region •  NaSonal Capital Region

Regional Competitiveness Committees (RCCs)

•  Track local compeSSveness indicators •  Formulate programs to improve compeSSveness

•  Engage in investment promoSon acSviSes to airact investors and create new jobs

Cities and Municipalities Competitiveness Index

Overall Competitiveness Top 10 CiSes

RANK out of 122 REGION PROVINCE LGU SCORE

out of 100

1 Northern Mindanao Misamis Oriental Cagayan de Oro City 72.09

2 Western Visayas Iloilo City Iloilo City 68.23

3 Central Luzon Pampanga San Fernando City 67.89

4 CARAGA Agusan del Norte Butuan City 63.07 5 Western Visayas Negros Occ. Bacolod City 61.62 6 SOCCSKSARGEN South Cotabato Koronadal 61.27

7 Ilocos Region La Union San Fernando 61.17 8 Central Luzon Zambales Olongapo City 60.63 9 Bicol Region Camarines Sur Naga 60.53 10 NCR Marikina 59.73

Overall Competitiveness Top 10 MunicipaliSes

RANK out of 163 REGION PROVINCE LGU SCORE

out of 100

1 CARAGA Agusan del Sur San Francisco 54.86

2 Central Luzon Pampanga Guagua 54.18

3 CALABARZON Cavite Carmona 53.18

4 BICOL Region Camarines Norte Daet 51.45 5 CALABARZON Cavite General Trias 51.22 6 Central Luzon Nueva Ecija Guimba 50.46

7 Central Luzon Pampanga Mexico 50.18 8 SOCCSKSARGEN South Cotabato Surallah 49.82 9 CALABARZON Rizal Taytay 49.19 10 CARAGA Agusan del Sur Prosperidad 48.92

Source: TIME Inven;on Poll, in coopera;on with Qualcomm

The age of invention/innovation is NOW

TIME Inven(on Poll

Source: TIME Inven;on Poll, in coopera;on with Qualcomm

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competitiveness in s&t and innovation in the philippines

Data & Analytics