October 28, 2013 | page 1 of 2

Doing Business 2014 Launch Speech of Mr. Motoo Konishi, Philippines Country Director, World Bank
(as prepared for delivery) Doing Business this year recognizes the significant progress the Philippines has made in recent years as reforms are implemented and results are felt on the ground. The Philippines jumped up in ranking by 30 points from 138 to 108, more than any other country out of 189 economies that Doing Business measures. This is the first major improvement for the Philippines in the Doing Business ranking since the report started 11 years ago. This change is a result of a concerted effort by the government in close consultation and partnership with the private sector. The National Competitiveness Council mobilized a major effort to coordinate the activities of a wide range of national and local government offices to implement reforms. Why is this important? Doing Business Report measures costs in terms of time and money arising from various rules and regulations in a country. It focuses on the costs faced by small and medium enterprises, which play a key role in generating jobs. The World Bank estimates that the Philippines needs to generate around 10 million jobs per year. Today, over 95% of the labor force in the Philippines are either self-employed or work in micro, small and medium enterprises. A vast majority of those working in these enterprises work in very small firms. Creating an environment that helps micro and small enterprises to grow is essential to create jobs in the economy.

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We need an environment where various permits and licenses are rationalized, where compliance with rules and regulations does not create unreasonable burden, where rules and regulations are clear and transparent, where creditworthy firms can obtain financing even if they do not have real estate to offer as a collateral, and where disputes are resolved efficiently, fairly and at low cost. We hope the Philippines continues on the path of reform. As we have heard, business registration and renewal of various permits remains an area that needs major improvements. In Malaysia one needs only 6 days and 3 steps to register a business. In the Philippines, 15 steps and 35 days. An effective electronic platform for business registration would not only reduce costs, but improve transparency and accountability of the various agencies responsible for each step in business registration. Some legal acts need to be changed to bring them up to date with modern practices, shifting away from requirements for paper receipts and stamped books in the age of computers. Of course, Doing Business only captures a small number of reforms in a broader agenda set by the government. This year, Doing Business ranking improvement confirms that reforms bring results. It also teaches us about approaches that work. We know that we need to address the constraints that firms face, to help them grow and create jobs for the Filipino people. The better ranking reflects the real changes in the environment faced by businesses in the Philippines.