Local government units (LGUs), particularly those where investors prefer to set up shop, have begun to see the importance of making it easy for businessmen to put up their establishments.

The National Competitiveness Council (NCC) said local governments are part of the implementation of a game plan that seeks to make it easy for businessmen to do business in the country.

The ultimate goal of the “game plan” is to improve the Philippines’s competitiveness rankings, which could entice more investors into the country. This game plan was unveiled on May 3, during the first Ease of Doing Business Summit, where reforms developed by the government and the private sector to streamline business-regulatory practices were highlighted.

“The NCC has taken local governments into account in crafting the game plan. In fact, four [out of 10] indicators have some local government participation,” said Guillermo M. Luz, co-chairman of the NCC.

Luz recognized the importance of local governments in efforts to simplify business processes. For one, businessmen need to secure a number of permits from LGUs, aside from the requisite permits from national agencies, before they could start a business.

In Quezon City, for instance, entrepreneurs need to secure several clearances—mayor’s permit, construction permit, occupation permit, health permit and other papers—before they could finally start doing business.

In a previous Doing Business (DB) Report of the World Bank-International Finance Corp. (WB-IFC), Quezon City was tagged as one of the laggards when it came to securing construction permits and registering a property. Overall, the city ranked 12th in terms of ease of doing business.

After the release of the 2012 edition of the DB Report, the local government of Quezon City worked with the IFC to implement a number of reforms. Local government officials, led by Mayor Herbert Bautista, constituted the Task Force Ease of Doing Business to integrate and coordinate efforts to implement reforms.

Bautista issued Executive Order 17 (series of 2011) that effectively reduced by more than 50 percent the processes and requirements for applying for construction permits. The order also slashed 78 steps in the process and reduced it to only 14 procedures.

The IFC noted that because of the reforms undertaken by the Quezon City government such as the Business One-Stop Shop, new business registrations have increased by 32 percent.

Luz hopes the experience of Quezon City would inspire other cities and towns to implement reforms and make it easier for businessmen to invest.

The national government and the private sector have targeted to improve the country’s competitiveness ranking in the DB Survey to as high as 38th next year. The 2014 edition of the report jointly undertaken by the WB and the IFC is expected to come out in October.

In the 2013 DB Report of WB-IFC, the Philippines placed 135th in the 185 economies and ranked 8th out of 9 in Asean.

The NCC said the 38th rank could be achieved under the so-called stretch target scenario, wherein all recommendations and reforms are completed on four big-impact indicators—starting a business, getting credit, protecting investors and resolving insolvency—by July 1, 2013.

The Philippines could rank 109th under the “low hanging-fruit scenario” if all recommendations and reforms are completed at a moderate level on seven indicators—starting a business, dealing with construction permits, registering property, protecting investors, paying taxes and resolving insolvency—by July 1.

original source: www.businessmirror.com.ph