Is the Long-term Economic Decline of the Philippines Unstoppable? Trends, Reasons, Outlook

Source:
By:Peter Richter

DOI: https://doi.org/10.30564/jsbe.v6i4.5813

Abstract:

The Philippines was in the 1960s a model of development in Asia and second to Japan, but occupies presently only the 11th position under South-East and East Asian countries in terms of GDP-per capita. The article explores why this important Asian country with a long colonial past and enormous economic potential still ranks under lowerincome countries and has in the last decades let pass by many other Asian countries. In answering this question, the approach of external triggers for accelerated development is being applied. In stark contrast to the success stories of the strongly outward-looking Asian countries like the four Tigers, later of Thailand and Vietnam the Philippines never developed a vision of an open economy connecting pro-actively to the world markets. Trade is hampered by a noncompetitive and highly protected national economy. The existing FDI is more oriented to the profitable local markets. Foreign debts were never effectively used and international tourism was never well promoted. Linking these failures to the existing power structures in the country, it seems very much that the backward forces like the big landowners, the local producers and industrialists never wanted and continue not to want to open up the economy to international competition and governments are complacent with these groups. Various indicators demonstrate the long-term decline of the Philippines: Among them the slow growth of the GDP and the continuously high poverty rates. As the alliance of big business and policy holds firm no change in the failing nationalistic economic model can be detected leaving the bleak outlook that the economic decline will continue.

References:

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