EASE OF DOING BUSINESSModerator: Guillermo Luz

National Competitiveness Council

28 November 2016

The goal of the New Industrial Policy is to create globally competitive, value adding, and innovative industries that would generate more and productive jobs and reduce poverty towards shared prosperity for all.

Shipbuilding

Electronics

AutomotiveAerospace

parts

Chemicals

Garments

agribusiness Furniture

IT BPM

Breakout Session Goal

• For each area, identify the most binding constraints preventing industry growth and recommend policy measures to resolve these constraints that would produce the biggest bang & lead to highly significant improvement in the overall business and investment environment • Competitiveness and innovation

• Labor & HRD

• Physical infrastructure

• Ease of doing business

• MSME Development & inclusive business

• Incentives & other forms of government support

• International Trade & FTAs

Current State of PH Competitiveness and Ease of

Doing Business

Global Competitiveness Report Card

REACHED THE TOP THIRD LATEST PERFORMANCE

*with 2016 Results, **reverse ranking (1 as worst)

REPORT 2010/2011 2015/2016GOAL

(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 70/178 59 ↑ 45

3. Corruption Perceptions Index (TI) 134/178 95/175 58 ↑ 39

4. Global Competitiveness Report (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 74/141 46 ↑ 20

7. WIPO- Global Innovation Index (WIPO)* 91/125 74/128 47 ↑ 17

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 7/145 47 ↑ 2

12. World Competitiveness Report (IMD)* 41/59 42/60 20 ↓ 1

13. Logistics Performance Index (WB)* 44/155 71/160 53 ↓ 27

UPGRADE DOWNGRADE

GLOBAL COMPETITIVENESS REPORTHow far are we from the best? ( 2016 Rankings)

Switzerland

1 2Singapore

3United States

Best in the World

Best in ASEAN

2

Singapore

25 34

Malaysia Thailand

57Out of 138

economies

RED – bottom 20% PURPLE – bottom 40-21% GREEN– bottom 50 – 41% BLACK – 49% or higher

PHILIPPINE RANKINGS PILLARS (2010-2016)

PILLARS 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

Change2010-2016

OVER-ALL RANKING 57 47 52 59 65 75 85 ↓ 10 ↑ 281st pillar: Institutions 91 77 67 79 94 117 125 ↓ 14 ↑ 342nd pillar: Infrastructure 95 90 91 96 98 105 104 ↓ 5 ↑ 9

3rd pillar: Macroeconomic environment 20 24 26 40 36 54 68 ↑ 4 ↑ 48

4th pillar: Health and primary education 81 86 92 96 98 92 90 ↑ 5 ↑ 9

5th pillar: Higher education and training 58 63 64 67 64 71 73 ↑ 5 ↑ 15

6th pillar: Goods market efficiency 99 80 70 82 86 88 97 ↓ 19 ↓ 2

7th pillar: Labor market efficiency 86 82 91 100 103 113 111 ↓ 4 ↑ 25

8th pillar: Financial market development 48 48 49 48 58 71 75 0 ↑ 27

9th pillar: Technological readiness 83 68 69 77 79 83 95 ↓ 15 ↑ 1210th pillar: Market size 31 30 35 33 35 36 37 ↓ 1 ↑ 611th pillar: Business sophistication 52 42 46 49 49 57 60 ↓ 10 ↑ 812th pillar: Innovation 62 48 52 69 94 108 111 ↓ 14 ↑ 49

EODB: PHILIPPINES & ASEAN, 2016-2017

Source: Published DB reports (2016-2017)

ASEAN2017 REPORT

(190 economies)2016 REPORT

(189 economies)Change

2016-2017

1 Singapore 2 1 ↓ 1

2 Malaysia 23 18 ↓ 5

3 Thailand 46 49 ↑ 3

4 Vietnam 82 90 ↑ 8

5 Brunei Darussalam 72 84 ↑ 12

6 Indonesia 91 109 ↑ 18

7 Philippines 99 103 ↑ 4

8 Cambodia 131 127 ↓ 4

9 Lao PDR 139 134 ↓ 5

10 Myanmar 170 167 ↓ 3

UPGRADE DOWNGRADE

DOING BUSINESS INDICATORSPHILIPPINES (2016-2017)

Source: Published DB reports (2016-2017)

INDICATORS2017 REPORT

(190 economies)2016 REPORT

(189 economies)Change

2016-2017

OVER-ALL RANKING 99 103 ↑ 4

1. Starting a Business 171 165 ↓ 6

2. Dealing w/ Construction Permits 85 99 ↑ 14

3. Getting Electricity 22 19 ↓ 3

4. Registering Property 112 112 --

5. Getting Credit 118 109 ↓ 9

6. Protecting Investors 137 155 ↑ 18

7. Paying Taxes 115 126 ↑ 11

8. Trading Across Borders 95 95 --

9. Enforcing Contracts 136 140 ↑ 4

10. Resolving Insolvency 56 53 ↓ 3

UPGRADE DOWNGRADE

STARTING A BUSINESS(FR 16 Steps, 28 Days TO 6 Steps, 8 Days)

3 STEPS AND 3 DAYS

National Government Register the company with SEC + BIR + SSS + Pag-IBIG Fund + PhilHealth (All in one form and transaction)

BIR

Streamlining of related

procedures

Local Government

Barangay Clearance + Community Tax

Certificate (CTC) + Mayor’s Permit

1 2 3

Business Permits and Licensing System

OLD vs NEW BPLS STANDARDS

New :

10 - 5 days

Renewal :

5 days or less

New :

1 – 2 days

Renewal :

1 day or less

Max of 2, Mayor and

Treasurer/BPLO

Max of 2, Mayor and

Treasurer/BPLO with

alternatives

Unified FormUnified Form (Print and

Electronic document)

Max of 5 steps for New and

Renewal of business

registration

Max of 3 steps for New

and Renewal of business

registration

JMC 2010 JMC 2016

PROCESSING

TIME

NUMBER OF

STEPS

NUMBER OF

FORMS

NUMBER OF

SIGNATORIES

LGUs Compliant with New Standards:JMC 2016

Source: Cities and Municipalities Competitiveness Index 2016

TYPE OF BUSINESS APPLICATION

LGUS COMPLIANT(OUT OF 1,389)

PROCESSING TIME

New Applications 1,017 2 days or Less

Renewals 1,139 1 day or Less

LGUs with BPLS Automation

Source: Cities and Municipalities Competitiveness Index 2016

LGU Category Automated Not AutomatedNo Data

AvailableCoverage

Highly Urbanized Cities 303

(Las Pinas, San Juan,

and Zamboanga)

1 (Navotas) 34

Component / Independent

Component Cities77 23 10 110

1st to 2nd Class

Municipalities241 192 55 488

3rd to 6th Class

Municipalities229 443 85 757

TOTAL 577 661 151 1,389

Other BPLS Reforms

Bureau of Fire Protection Co-Location

Simultaneous issuance of Mayor’s Permit and Barangay Permit

Remove Pass-Through Charges

Coordinated Local Traffic Ordinances

GOVERNMENT ONLINE:New Projects

WHY GO ONLINEMany NGA and LGU licenses and permits are :

Paper-based; use multiple,identical formsRequire manual applicationRequire manual processingOver-the-counter transactionsTake place in multiple officesin different locationsTake too long

GOVERNMENT ONLINE

THE GOAL• Ability to file applications online, anytime, anywhere.

• Online payment via credit card, debit payments, mobile cash,any form of online payment. Payments can be credited toappropriate agency.

• License or permit can be issued electronically by agency,where appropriate.

• Online kiosks to be provided ingovernment offices toaccommodate those withoutaccess to computers.

GOVERNMENT ONLINE

COVERAGEEase of Doing Business- Contains basic licenses and permits for starting,renewing, and operating businesses at the national and local governmentlevels.

Portal: www.business.gov.ph

Trade Facilitation- Inter-Agency Business Process Interoperability (IABPI).

Link approximately 55 agencies or units of government involved inimport/export and movement of goods.

Portal: www.trade.gov.ph

National Quality Infrastructure- Focus on the standards, accreditation,and certification of agricultural, industrial, food, and pharmaceuticalproducts.

Portal: www.quality.gov.ph

PROJECT REPEAL – Rationale

• Consumers and Businesses are saddled by toomuch regulation.

• Regulation happens at Executive, Legislative, LocalGovernment levels

• Laws date back to Commonwealth period andincludes PDs from MartialLaw era.

• Multiple layersof laws, rules, regulations.

• Are they allnecessaryor relevant?

PROJECT REPEAL – Participating Agencies

• From 8 Initial Agencies in the 1st RepealDay, 74 Additional Agencies havejoined our cause to fight red tape.

PROJECT REPEAL – Updates

STOCKTAKE Total

As of June 13, 2016 17,388

Enrolled for 1st Repeal Day (3,777)

Balance for Review 13,611

Additional Submissions 16,514

As of October 25, 2016 30, 125

Recommendations

Key Recommendations

• Making services available online in terms of securing permitsand other relevant documents.

• Inter-agency operability of government services.

• Amendment of the Corporation Code and the localgovernment code related to business regulation.

• Push for the passage of the Ease of Doing Business Act of 2016and the Government Efficiency Office Act.

• Review of the Foreign Investments Act.

• Inventory of ecozones for possible expansion andestablishment of additional ecozones.

doingbusiness@competitive.org.phFor queries, you may email us at: