PH’s Economic Development History

by Bill Patrick Familara (2013)

Long before the arrival of the Spaniards in the Philippine archipelago, the natives have already a socio-political and economic system. Tribes are trading to each other and the foreign relations have been established as free trade is already being done with the neighboring kingdoms and empires like China, Indochina and people from Malay Archipelago. This is in the form of a barter system. In Barter system, people do not use notes and/ or currency to exchange goods and services. What they do is exchanging a good that has the same value to other. For example, I will trade my carabao to you in exchange of 15 sacks of rice. This kind of economic system have been used until the late 1600 when the Kingdom of Spain finally took control on the Philippine Archipelago but limited to the Kingdom of Sulu that was reigned until 1962.
When the Kingdom of Spain successfully took over the archipelago, they established an economic system that brought progress and growth to the colony’s economy. The Manila- Acapulco Galleon Trade opened new opportunities to the Indios to acquire new knowledge and skills. This Galleon trade last until 1815 when the Mexican War of Independence put a permanent stop to the galleon trade route. This marked the first time trade truly became global, wherein Asian goods /BILL PATRICK FAMILARA (c)/ were sold to Latin America. It's the first instance in human history when all trade-routes across the planet interlinked, arguably making Manila the world's first Global City and the Manila Galleon route the prototype for global trade.

During the time of the galleon trade, Manila was exclusively trading its goods to Acapulco and limited to the rest of the world. When the Kingdom of Spain was defeated by the British Kingdom, Manila opens its trade to the world market. Thus, the exchange of goods and services expands to the rest of the world. That we could see Manila as the only progressive city in Las Islas Filipinas for the reason that the existence of Hacienda system is being observed and the monopoly of a certain product like Tobacco, Corn and Sugar cane are the only products being produced in the large part of the Filipina Archipelago. This kind of system hinders to the economic development of the provinces.

After the Treaty of Paris, The Republica de Filipinas fall under the control of the United States and successfully established new and modern economic system, adapting what is being used in European and American countries. United States flooded the Filipino Market by their products. They redressed the Philippines from a medieval like society into Americanized one. They introduced more diverse and free trade but limited to the United States market.

After World War 2, The Philippines finally got its independence to the United States. But this time, the capital city was fully devastated by the war. The economy of the newly recognized country had collapsed. And the role of the government is to re-established to fundamental pillars of the economy.
In Marcos time, The Philippines was considered as one of the most progressive country in terms of economy next to Japan. The Bagong Lipunan trend was introduced and said “Ang Pilipinas ay Muling Dadakila”. He established strong foreign economic relations to the far eastern or West Asian countries. Thus, strong foreign direct investments were put in the country’s economy. Series of building new infrastructures like bridges, roads, convention centers, trains helped allot especially on the issue of unemployment when thousands of Filipinos were employed that time.

After what they so-called successful peaceful revolution, Cory Aquino was proclaimed as the new president of the republic. On her time, the economy of the country was freeze. Series of insurgences occurred that resulted to the collapsed of the basic economic foundations of the country. That time, the whole archipelago undergone on a dark age like period.

Nowadays, after the former president Gloria Macapagal Aroyo successfully rebuild and re-established the fundamentals of the Philippine economy. The current presedent is in easy term on facilitating and keeping this track into a good way.

(sorry for grammatical errors)

Understanding Poverty

by B.P. Familara

[A family living under the bridge of CAVITEX]

Poverty is an economic status of being poor. There are many factors why poverty exists. According to C. Wright Mills, an American sociologist, poverty has two main reasons why it exists these are the personal troubles and public issues. Personal troubles are the issues of every individual why they can’t find a job. Some are not qualified to the job they’re applying in, some are over qualified to have that job, but most often it is about the attitude of the person applying a job or their attitude towards work. For example, if the town has population of 200 and 180 of it is employed and only 20 are not. It is an issue that the government cannot do about because there are a lot of opportunities but these 20 unemployed might having a hard time in finding a job. In contrast to this, if 180 are unemployed and only 20 are employed this is what we called Public issue. This is a manifestation that the social structure of a society has been collapsed. There are many work forces but here are less job opportunities combined with some personal troubles.

Poverty in our country is a product of the two realities, the economic underdevelopment and the reality of inequality. The unequal distribution of wealth in our country affects great to the development of our economy. The rich becomes richer while the poor becomes poorer. The amount of assets that our economy produces is not enough to follow the level of sophistication of the technology that is being used by the mainstream. The result of this is that our locally made product cannot compete to the world market due to the durability and price differences, imported good often cheaper than homegrown / locally produced goods, that often resulting to bankruptcy of local businesses.

After world war two, Philippines are next to Japan in terms of economic development but the faith of our country is not that good as Japan.  The question lies on my mind how come we did not develop like Japan? Somehow, it lies on foreign relationship with the US. American put their Military bases that hindered us to explore our full potential. Our preferential agreement in the US market for Philippine sugar, for example, shielded the favored Filipino farmers from urgency of competition and modernization. Comparing the value of Peso to American dollars usually makes us blind to the real situation and to think an illusion of prosperity, prosperity that in reality we can’t even feel. We have not paid attention in the modernization of our agriculture industry and we did not even build more modern infrastructure. Our public education system before was farther good than the private educational institutions. However, we let it to be deteriorated. Nowadays, we choose to educate our children in private schools rather than in the public, thinking that they will be trained well in on that institution.

On the time of the presidency of Marcos, problems during his governance took over his efforts in economic development. He loaned billions of peso for the Kilusang Bagong Lipunan, but the money was misused and the world economy entered into recession that resulted to our government cannot pay it. His modernization project also failed because it is untenable. Despite the fact that late President Marcos did wrong, we should honor him for his efforts to rebuild and develop our country, though it was not successful.

Our bad experiences during Marcos about modernization make us blind for the reality that we need a development. We became paranoid, our democratic rights and freedom. During the presidency of the first lady president, Cory Aquino, series of coups‘d’état hindered our economic development and frightens foreign investors to invest to our country.   This coup makes our economy frost while our population is growing fast. Thus, it results to social imbalance and the collapsed of our social structure.

The dilemma nowadays is that the growing economy cannot actually feel by the poor, but only by the few elites that actually controls it. Yes, after the first decade of the 21th century, and according to the news reports, our economy have grown and we are now 3^rd next to Thailand and China which is the 1^st in Asia’s fast growing economy.

The solution to those problem is to the government should provide and meet the basic needs of our society. By rebuilding social trust, the fight for corruption is one of the best example, and re-establishing the social structure of opportunities. Re-establishing it absolutely will produce more job opportunities, but it is still depending on the cooperation and participation of the people to this move.

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This article is based on the article published by the Philippine Daily Inquirer,on July 15, 2000 with the same title