Economic Setting::

The Philippines

Reported by:

Gerlie Vallejo

(Crim. 2-B, Group 1)

Economic Setting:

The Philippines

• Before World War II (1939-1945)the economy of the Philippineswas based on the productionand export of a narrow range ofprimary commodities, mainlyagricultural and forest products.The Supreme Court of the

Economic Setting:

The Philippines

United States ruled in the early20th century that Philippinegoods could enter the Americanmarket without tariff restraints.In the trade that followed, theUnited States importedPhilippine agricultural goods and

Economic Setting:

The Philippines

provided the Philippines withmost manufactured items. ThePhilippines had virtually nomanufacturing other than theprocessing of food products,primarily for the United Statesmarket.

Economic Setting:

The Philippines

After independence in 1946, thePhilippines initially remaineddependent on free-trade accessto United States markets for itsagricultural commodities,especially sugar. Governmentrestrictions on import spending

Economic Setting:

The Philippines

spurred an increase inmanufacturing for the domesticmarket. During the 1950s thePhilippines tried to become anindustrialized nation. In the longterm, however, protectionisteconomic policies provided little

Economic Setting:

The Philippines

incentive for the development oflabor-intensive exportmanufacturing. In the 1970s thegovernment implemented apolicy to encourage exportmanufactures and foreigninvestment, and the rate of

Economic Setting:

The Philippines

economic growth accelerated.The country’s foreign debt rosedramatically, however, and bythe mid-1970s the country facedproblems meeting payments onits international loans. Thisproblem was compounded by a

Economic Setting:

The Philippines

worldwide recession in the early1980s. The recession resulted inless demand for Philippinemanufactures, and the economymoved into a deep recession inthe mid-1980s.

Economic Setting:

The Philippines

At this time the Philippineeconomy also suffered frommore than a decade of economicmismanagement underPresident Ferdinand Marcos,who ruled by decree afterdeclaring martial law in 1972.

Economic Setting:

The Philippines

Under Marcos the governmentgreatly expanded the number ofpublic-sector enterprises.Government-mandatedmonopolies were set up invarious sectors, while subsidiesand special privileges were

Economic Setting:

The Philippines

awarded to close associates ofMarcos. This concentration ofownership and control amongthe president’s closest businessassociates, friends, and relativesbecame known as cronycapitalism. The system allowed

Economic Setting:

The Philippines

for rampant corruption. Duringthe economic recession of the1980s, many of the cronyenterprises experienced severefinancial difficulties. This in turnundermined the viability of thebig government-owned banksand led to an economic crisis.

Economic Setting:

The Philippines

Major structural reformsimplemented during succeedinggovernment administrationsdismantled the monopolies andpromoted privatization.Measures to stabilize theeconomy involved compliance

Economic Setting:

The Philippines

with a severe austerity programof the International MonetaryFund (IMF). Economic reformsreduced governmentintervention in the economy andstimulated the private sector. Bythe mid-1990s the Philippine

Economic Setting:

The Philippines

economy had largely recoveredand was experiencing steadygrowth. It contracted much lessdramatically than other Asiancountries from the regionalfinancial crisis of 1997. Itcontracted much less

Economic Setting:

The Philippines

dramatically than other Asiancountries from the regionalfinancial crisis of 1997. It wasalso slower to rebound,however, due to droughtconditions that caused a sharpfall in agricultural output in

Economic Setting:

The Philippines

1998. The modest pace ofeconomic recovery wasadversely affected by corruptionin government and a globaleconomic downturn in the early2000s that reduced demand forPhilippine manufactures by the

Economic Setting:

The Philippines

country’s two largest tradingpartners, the United States andJapan.

Economic Setting:

The Philippines

In the early 2000s thegovernment was pursuingeconomic reforms to help thePhilippines match the pace ofdevelopment in the so-callednewly industrialized economiesof East Asia. The strategy

Economic Setting:

The Philippines

includes improvinginfrastructure, revamping the taxsystem to increase governmentrevenues, promoting furtherderegulation and privatization ofthe economy, and expandingtrade ties in the region.

Economic Setting:

The Philippines

The estimated governmentalbudget in 2006 includedrevenues of $19 billion andexpenditures of $20.5 billion.Gross domestic product (GDP) in2006 was $117.6 billion, or$1,362.80 per person.

Economic Setting:

The Philippines

Source:

Microsoft ® Encarta ® 2009. © 1993-2008 Microsoft

Corporation. All rights reserved.

Economic Setting:

The Philippines

Salamat!!!

Economic Setting

as we

Understanding

Economic Community

for

establish an

Republic of the Philippines

CAPIZ STATE UNIVERSITY

Dumarao Satellite College, Dumarao, Capiz

Theme: “Understanding Better the Political, Economic & Socio-Cultural Setting of Southeast Asian Nations for

Peace, Prosperity & People”

March 09, 2015 (8:00-11:30 am)

Campus Library