The Philippines’ competitiveness in trade logistics dropped to rank 71st among 160 countries this year due to poor infrastructure, a World Bank report showed, with the private sector co-chair of the National Competitiveness Council (NCC) also pinning the blame on the port congestion problem that plagued businesses two years ago.
The report titled “Connecting to Compete 2016: Trade Logistics in the Global Economy” showed the Philippines’ ranking decline from 57th in 2014.
The Philippines’ Logistics Performance Index (LPI) score also dropped to 2.86 this year from a score of 3 two years ago.
According to the World Bank, the LPI was a “comprehensive measure of the efficiency of international supply chains” being published biennially since 2007.
Among the 160 countries covered by this year’s report, Germany had the highest LPI score of 4.23, while the lowest score of 1.6 was posted by Syria.
Compared with other lower middle-income countries, the Philippines’ rank was below those of India, Kenya, Egypt, Indonesia, Vietnam and Pakistan. In 2014, the Philippines had a better LPI score than Egypt, Kenya and Pakistan.
The LPI analyzes countries using six “core pillars” of logistics performance, namely: the efficiency of customs and border management clearance; the quality of trade and transport infrastructure; the ease of arranging competitively priced shipments; the competence and quality of logistics services; the ability to track and trace consignments, and the frequency with which shipments reach consignees within scheduled or expected delivery times.
Across these six components, the Philippines ranked the lowest in infrastructure, at 82nd place, with a score of 2.55.
In customs, the Philippines was at 78th spot, with a score of 2.61; in logistics quality and competence, 77th with a score of 2.7; tracking and tracing, 73rd with a score of 2.86; timeliness, 70th with a score of 3.35, and international shipments, 60th with a score of 3.01.
Sought to comment about the report, NCC private sector co-chair Guillermo M. Luz attributed the decline in ranking to the congestion at the country’s ports which was experienced in 2014 due to the truck ban implemented in the city of Manila, home to the country’s major sea ports.
“In the past two years, what really hurt was when there was the truck ban that triggered off all the Manila port congestion. It took so long to fix the backlog, only by the decision of one local government unit, and that hurt. So in a way, we shouldn’t be surprised,” Luz told reporters.