THE Philippines’ digital competitiveness has fallen for a second straight year based on an annual ranking released on Thursday by Switzerland’s Institute for Management Development (IMD).
The country was 61st out of 67 economies in the 2024 list, produced by the IMD’s World Competitiveness Center (WCC). This was down from 59th last year when it lost three spots from 56th in 2022.
It was next to last among 14 Asia-Pacific countries, unchanged since 2020, and 25th among 30 economies with populations of more than 20 million, also the same as last year.
Singapore continued to lead the list while the United States experienced a three-place drop to fourth. Switzerland and Denmark took second and third, respectively.
Singapore’s top ranking was said to reflect its advanced city management, prolific high-tech patent grants, and robust banking and financial sectors.
Switzerland, meanwhile, improved in terms of high-tech exports and cybersecurity, and Denmark was strong in the areas of employee training, e-governance and secure internet servers.
In contrast, the US saw declines in its attitude to globalization, international managerial experience and increasing fears of failure among entrepreneurs.
The IMD ranking measures digital competitiveness using three main factors — knowledge, technology and future readiness — and the Philippines lost places with regard to the first two.
It was 64th in terms of knowledge, 56th in terms of technology — down from last year’s 59th and 63rd, respectively. It edged up, however, to 58th from 59th in the area of future readiness.
Broken down further, the Philippines’ rankings also slipped with regard to sub-factors under the three main categories.
It fell to 60th from 56th in terms of talent, 61st from 58th in scientific concentration, and remained 62nd in training and education — all under the knowledge pillar.
Sub-factor rankings under technology all fell: 66th from 63rd for regulatory framework, 45th from 41st for capital and 53rd from 43rd in the area of technological framework.
Improvements, however, came in the future readiness sub-factors of adaptive attitudes (52nd from 59th) and IT integration, 58th from 60th, although a drip to 54th from 50th was seen in the area of business agility.
There were some bright spots for the country: it was second overall in terms of female researchers (under scientific concentration) and high-tech exports (technological framework).
It was 22nd with regard to science graduates (training and education), 9th in telecommunication invest ments (capital), and 19th in flexibility and adaptability (adaptive attitudes).
The biggest weaknesses, meanwhile, were in the areas of artificial intelligence (AI) articles (66th, scientific concentration), secure internet servers and communications technology (64th and 66th, respectively, under technological framework), and starting a business and enforcing contracts (65th and 64th, regulatory framework).
The country’s main challenges, according to IMD partner the Rizalino Navarro Policy Center for Competitiveness of the Asian Institute of Management, are:
– sustaining job-generating investments;
– ensuring food security to temper inflation and keep prices affordable;
– addressing learning gaps to improve the education system;
– building sustainable infrastructure to reduce climate change vulnerability; and
– resolving the Philippines’ territorial rights to the West Philippine Sea diplomatically and peacefully.
Jose Caballero, senior economist at the WCC, said that geopolitical rivalries — particularly between the US and China — were fragmenting the global digital landscape.
Geopolitical tensions have also become a defining feature in shaping digital competitiveness, the IMD said.
Economies, the business school said, will have to grapple with the pace of technological change and capability requirements.
Countries that effectively exploit the power of new technologies such as AI, blockchain and quantum computing, it added, “are likely to enhance their digital competitive advantage, leading to sustained economic growth, improved productivity and greater global influence.
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