UK Expat in Asia. Travel, Business, Geopolitics and Sport. Updated 6y
Well there are quite a few reasons.
I would point out though that these problems are not unique to the Philippines, they are common to many developing countries around the world. I also think they are surmountable and there are many reasons to be optimistic about the prospects for the Philippines in the future.
- Corruption - It is endemic at all levels and agencies of Government. Graft, embezzlement, fraud and bribery are commonplace. That is the money of the Filipino taxpayer - money that could be spent on development projects and services. It also adversely effects foreign investment because the one thing a business or entrepreneur wants to ensure is that their money and investment is safe. Without healthy institutions you don’t have that.
- Historical factors from its time as a Spanish Colony - The Spanish had a particularly pervasive way of running their empire. They created a mestizo class to control political and business power. Of course when the Spanish left those powerful dynastic families had no intention of giving up their power. They never legislated for a strong nation state that was free and fair nation and inclusive for all. Instead they consolidated their wealth and power and to this day the Philippines, a country of over 100 million people, is governed by 400 dynastic families. As they say, “the faces change but the surnames stay the same.” Former President Aquino’s own family involvement in Politics goes back over 100 years. The Philippines is unfair because it was designed to be that way. The same is true of many former Spanish Colonies in South and Central America.
- The resulting Oligarchy and lack of free markets - The Country lacks free markets. As a result, without competition their is no incentive to drive up standards and innovate. Case in Point - Philippine internet is one of the slowest connections in Asia. The reason being that there are only a handful of (maybe 4–5) internet providers. All are Philippine owned and they can charge high prices for substandard network and infrastructure without fear of facing foreign competition.
- Market protectionism disrupting the supply chain - Similar to point 3 - market protectionism through high trade tariffs have affected the supply chain. Goods and products are sometimes hard to find in shops, are frequently out of stock and foreign products are overpriced which adversely affects economic growth.
- Poor education and lack of opportunities - Ambitious and educated Filipinos move abroad leading to a brain drain. Secondary and Tertiary education is generally poor by Western standards and there is a lack of decent career opportunities for young Filipinos. Many never get the opportunity - there may well be a Filipino Bill Gates, but he’s driving a Jeepney or working in a Sari-Sari store because he hasn’t been given the opportunity to succeed.
- Lack of Infrastructure Investment - There is big untapped potential in the Philippines such as the tourism industry. But the Philippines has suffered from years of under-investment in its crumbling infrastructure. Capital projects such as power, roads, airports and transportation in the Cities and across the archipelago lack serious investment.
- Meddling of the Catholic Church in Public Policy - Overpopulation, Poverty, Urban Sprawl and Pollution are all serious problems. While the Catholic Church is not directly to blame for these - they have advocated unhelpful positions such as opposition to bills designed to help fight these issues. The largest population growth rate is taking place among the poorest in Filipino society, the 40% that the UN classes as living in poverty. Ironically as the Philippines develops the number of people living in poverty is actually increasing…
As I mentioned I think most of these issues are surmountable and I am not overly pessimistic about the Philippines future. I have been there many times and there is a fairly robust middle class now developing.
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