The Transformation of the Philippine Economy

Abstract

Manila, 1981. A chauffeur-driven white Mercedes weaves in and out of the traffic backed up along what could well be a street in downtown Manhattan. This is Makoti, its modern skyscrapers housing the business and financial elite of the Philippines. In the back seat sits a well-dressed Filipino businessman whose millions have been amassed over the decades through production of goods for the domestic market. A man who has earned the epithet of "nationalist" by keeping his hands clean of involvement with foreign corporations and foreign markets. But times are changing. "Export or perish;" he sighs. First stop: the investment house of the Philippines' largest commercial bank to converse with influential friends in the hopes of obtaining a sizable loan to convert his production processes toward the export market. Second stop: a government office to register for tax exemptions and other gifts bestowed upon exporters. "A tragedy," he mutters on his way back to his limousine. "The Philippines is importing a perfect substitute for what I will be exporting. But with all the loans and tax exemptions reserved solely for exporters, how can I afford not to export?"

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