The Philippines climbed four spots to 47th out of 70 economies in this year’s edition of the World Competitiveness Yearbook (WCY) by Switzerland-based International Institute for Management Development (IMD), helping improve its standing compared to regional peers.

The country’s ranking in the 2026 WCY is an improvement from last year’s yearbook, when it ranked 51st out of 69 economies.

While the Philippines still maintained its low ranking of 13th out of 15 economies in Asia-Pacific, it is no longer dead last when compared to other countries in Southeast Asia.

The Philippines, which earned a total score of 59.07 in this year’s WCY, managed to surpass the performance of Indonesia, which only secured a score of 57.57.

The WCY measures the competitiveness of economies using 264 indicators across four pillars: economic performance, government efficiency, business efficiency, and infrastructure.

Statistical data account for 172 of the indicators, while the remaining 92 are gathered from an opinion survey of around 6,900 respondents.

In terms of the business efficiency pillar, the Philippines improved its ranking to 30th place this year from 46th in 2025.

The country improved its ranking in all sub-sectors of this pillar, including productivity and efficiency, labor market, finance, management practices, and attitudes and values.

This pillar evaluates the extent to which the country encourages enterprises to perform in a responsible, profitable, and innovative manner.

The Philippines’ ranking in the government efficiency pillar climbed six spots to 45th place, despite decline in tax policy and institutional framework sub-factors.

The pillar, which measures the conduciveness of government policies, registered improvements in public finance, business legislation, and societal framework sub-factors.

As for the economic performance pillar, the Philippines declined to 38th rank this year from 33rd last year.

The weaker performance was attributed to the poorer showing in the sub-factors of domestic economy, international trade, international investment, and employment. Only the prices sub-factor improved, jumping from 39th to 24th.

The country's lowest rank in this year’s WCY is the infrastructure pillar at 60th, which remained unchanged from last year’s rank.

This pillar assesses the degree to which technological, scientific, and human resources meet the needs of businesses.

For the year, IMD said the biggest challenges confronting the country is restoring its growth momentum while managing inflationary pressure from external shocks.

The country must also focus on strengthening its institutions to address bureaucratic inefficiency and mitigate corruption risks, as well as addressing pressing challenges in access to and quality of basic education.

Other top challenges include ensuring timely government responses to energy and food supply shocks and facilitating investments in renewable energy and climate risk mitigation.

Under this year’s WCY, Singapore ranked first out of 70 economies, an improvement from last year’s second rank.

Hong Kong was the second most competitive economy this year, while the former top economy, Switzerland, slid to third.