Philippines Economic Development Flashcards
What were the 2 advantages that the Philippines had over other SEA economies (with regard to their workforce and diplomatic ties)
- English speaking population
- Strong diplomatic ties to the USA
What did the Philippines suffer from (that the thais did not)
Lack of energy resources (Philippines was a net oil importer)
Was the Philippine state government dominant in planning and participation in economic activities?
Yes
When did state led ISI begin
1950s
Was the Philippines dependent on the agrarian sector? And if so, which goods were key exports for the Philippines
Dependent, tobacco and sugar
What was the Philippine rehabilitation act, how much aid did it provide to the Philippines, and in exchange for what.
620mil in financial aid, In exchange for Filipino rectification of bell act, grating Americans corporations right to exploit Philippine’s natural resources
What was context behind economic development from 1950s to 1960s
Pre martial law
What was the context behind economic development from 1970s to 1980s (3)
- Surge in oil prices
- International recession, fall in prices of primary products
- Martial law
What was the context behind economic development from 1980s to 1990s (2)
- political instability
- change of regime
What were the government strategies used in 1950-60s
- Economic nationalism
- Rapid industrialisation
What were the government strategies used from 1970s to 1980s (4, 2 broad ones)
Foreign investment and state led growth:
- agricultural development
- foreign investment and aid
- state corporations in ISI
- state infrastructural development
What were 3 ways in which the state promoted a shift to ISI in the 1950s
- import controls
- foreign exchange controls
- tax incentive laws
From what percent to what percent did manufacturing as a percentage of GDP increase by from 1950 to 1960
8% of GDP in 1950 to 20% in 1960
Why did ISI fail in the Philippines
Protectionist measures to encourage the establishment of import replacing industries — hindered growth of EFFICIENT domestic industries
Which 2 policies in what year (pre martial law) promoted economic nationalism
- Retail trade nationalisation act (1954) - anti Chinese, forced Chinese out of corn and rice trades
- Congress bill (1958) — important industries to be owned by at least 60% native Filipinos
When did the hukbalahap insurgency occur, and what sentiment did they have (consider Cold War)
Communist insurgency, 1945-54
How were the huks defeated, and was this effective/successful in instituting further land reforms
Magsaysay’s Economic development corporation, promised land reforms
- unsuccessful as blocked by ilustrado dominated congress
What policy (and when) was macapagal’s attempt at land reforms, did it succeed
1963: agricultural land reform code (after magsaysay)
- congress again resistant, failed to allocate sufficient funds for it to be carried out properly
What was most of gdp growth financed by from the 1960s to 1980s, which would become a problem later on
International loans
Which act, and in which year, incentivised foreign investment into industrial development
1967 investments incentives act
Who decided to start providing credit aggressively for infrastructural and economic development projects
Marcos, 1970s
When martial law was imposed, how much foreign debt was there, and how much did it increase to in 1983
2.2 billion to 25 billion in 1983
When was martial law implemented
1972
What industry did Marcos continue to prioritise (as competitive advantage)
Agriculture
What percentage of export value from 1967 to 1971 was generated by sugar coconut and other forestry products
70%
What was the IRRI, what was its breakthrough
International rice research institute (based in Philippines
- high-yielding variety of rice - IR8
By what multiple did rice production increase by from 1961 to 1981
2x
When did Philippines achieve self sufficiency in rice production
1972
Which 2 labour intensive manufactures grew rapidly in exports in the 1970s
Garments, electronics
What was the structural adjustment programme of the 1980s and why was it undertaken
- pressure from world bank to ease transition from ISI to EOI
1. Reduction in industrial protection
2. Liberalising import licensing procedures
From 1980 to 1983, by how much did foreign indebtedness rise by (% to %of GNP)
6% of GNP to 50% of GNP
What was the new communist insurgency encountered by Marcos in the 1970s
NPA (new people’s army)
What was Marcos’s land reform legislation under (name), when was it implemented, did it succeed and why/why not
Presidential decree no 27, 1972,
- allowed land to be sold to peasants to grow their own crops on
Did not succeed
- poorly staffed project, allies were all landowners — could not be alienated
What function did Marcos’s land reform programme serve instead of improving wealth distribution
Punishment for political opponents by confiscating their land
What characterised Aquino’s leadership (____ (short/long term) a period of political _____, and slow ________, led by return of ________)
Short term period of political stability and slow economic growth led by return of investor confidence
What were 3 major events during Aquino’s time in power that hampered economic development (and their years, one is a natural disaster, though almost same years)
- Aftermath of gulf wat (1990-91) — oil prices continue to spike
- closure of US military base in Philippines (1991) - reduced employment (by a lot)
- earthquake in Luzon (1990)
What was Aquino’s land reform called, when was it implemented
CARP, comprehensive agrarian reform program
1987
Why was there a continuation of strong landowning interests (considering the Filipino central bank and the people in it)
Central bank directed by businessmen and technocrats — heavily made of by ilustrado class
Why did CARP not succeed
- loophole ridden, weak legislation
- Aquino’s herself was part of the landowning elite and was thus reluctant
When did Ramos come into power
1992
What were the 3 main parts of Ramos’s strategy for economic reconstruction
- Trade liberalisation programme to attract foreign investment
- accelerated privatisation of state enterprise towards efficiency
- breakup of monopolies in major sectors
What slogan were Ramos’s new strategies implemented under
What was Ramos’s trade liberalisation programme (consider tariffs, import controls, FDI)
Tariffs lowered
Quantitative import controls lifted
Investment into ‘special economic zones’ - electronics equipment as new dominant export
Gave foreign investors right to 100% ownership of Philippine companies
What was the disadvantage of Ramos privatising inefficient state owned enterprises
Presented more opportunities for large conglomerates to accumulate wealth
What case demonstrated Ramos’s cronyism
Lucio tan - purchased Philippine airlines
How did Ramos go about land reform
Continued implementing provisions of CARP, but sped up efforts and enforcement
By 1998 when Ramos left office, what percentage of targeted land area was distributed to rural peasantry
More than half
What was the organisation responsible for overseeing CARP
Department of agrarian reform
What 4 factors led to a very limited impact of the AFC on Philippines
- Soundness and conservatism of the financial system
- Limited financial liberalisation
- Precious experiences resulting in stronger regulation
- Limited growth and limited impact
Why was the Philippine financial system sounder and more conservative (5)
- modelled on American standards
- transparent and proactive supervision by central bank directed
- high profitability and liquidity
- lower leverage ratio
- lower proportion of short term loans in foreign debt
In 1997, what percentage of all liabilities were towards Philippine nationals, vs Thailand?
45% vs 1%
What were the government’s responses to the AFC (4)
- Raised interest rates immediately
- Defended the peso before giving up and wasting more foreign reserves
- Sought immediate assistance form IMF
- Tightened budget, imposed fiscal austerity
What was the percentage of GDP comprised of by industry and manufacturing (separate) from 1980 to 1990, what does this show
Industry:
37 -> 35
Manufacturing:
22 -> 22
Stagnation of industry and manufacturing sectors
What were the 4 limitations of government strategies
- Crony capitalism
- Burden of external debt
- Consistent failure of land reform efforts
- Limitations of fiscal policies
Who was Roberto Benedicto
Head of government, owned Philippine sugar commission
- did not pass price increase of sugar on to growers
How much did the government absorb from Robert benedicto’s loses when sugar prices collapsed
14 billion pesos
Why did Philippines suffer from a large external debt
Lack of transparency in investment
How much did debt repayment take up as a percentage of GDP annually during Aquino’s term
10%
Who was the first president to attempt national development planning, under what program
Macapagal, program implementation agency (PIA)
What was the name of Marcos’s regime
The new society
What are 3 examples of public and state owned enterprises under Marcos, what did each do
- NEDA (national economic development authority) - self explanatory
- National development company - secured land for agriculture and establishment of other entities (sugar institute etc)
- Philippine chamber of commerce and industry (PCCI) - representative of private businesses
Which areas/industries did the Chinese Filipino families hold a substantial interest in (5)
- Banks
- Textiles
- Food
- Real estate
- Manufacturing
What was the name of the nationalist movement led by Garcia in the 1950s
‘Filipino first’
How did the role of the Chinese change in the Philippines over time (garcia vs Marcos)
- Discriminated by Garcia in nationalist efforts
- Recognised by Marcos in new society as political and economic allies
What resulted from the great share and cronyism that the Chinese enjoyed (esp in the 1990s)
- interest ethnic tensions - bank robberies and kidnapping
Between 1993 to 1997, there were approximately how many victims of Chinese-Filipino kidnappings
250 a year
How many jobs were lost as a result of the us closing their military base in the Philippines
70k jobs
