A Country Risk Analysis for Philippines - Assignment Example

While there reported some positive trends during recent years including the enhancement of the entrepreneurial environment in the country (Roberts 2012), there still are some critical zones that make the business environment less attractive. Thus, for example, based on the infrastructure, red tape, corporate governance, corruption, and crime criteria, the Philippines is ranked in the last position compared with Indonesia, Malaysia, and Thailand (Escribano et al, 2009). Moreover, the Philippines fails to protect the investors and there are more difficulties in obtaining credits than in its Asian neighbor countries.

In terms of the attraction of foreign direct investment to the economics of the Philippines, there also exist some formal and informal barriers imposed by the government combined with a weak judicial system and corruption (Roberts, 2012). All these factors make the Philippines a less desired destination for multinational corporations and foreign direct investments. Based on the recent World Bank survey results, the Philippines falls toward the bottom of the ranking of the business-friendly environment (Lesher, & Plummer 2011). However, despite its unfavorable investment climate, according to the UNCTAD, in the first half of 2013, there was recorded the second biggest FDI inflow to the Philippines among ASEAN countries (Malinao, 2013). Read More