ECONOMIC DEVELOPMENT

OF THE PHILIPPINES

FIDEL V. RAMOS

Economic Growth Can Thrive In A Democracy

FIDEL V. RAMOS 12th President of the Philippines (1992–1998), is remembered for steadfastly promotingthe principles of people empowerment and global competitiveness.

In 1993, He quickly led the nation out of darkness putting an end to the power crisis thatcrippled Filipino homes and industries for two years.

He made programs to fight poverty in accordance with the will of the Filipino peopleexpressed by 229 structural/reform laws enacted by Congress during his term.

The years 1993-1997, the Philippine economy recovered dramatically.

Ramos implemented a comprehensive Social Reform Agenda (SRA) that addressed thelong-standing problem of poverty: jobs and livelihood, health, education and skills training,housing, environmental protection, children and the youth, the elderly and thehandicapped, agrarian reform, and access to equal opportunity.

Filipino families’ average income grew more during his administration compared to 20years before. He pushed for the deregulation of key industries and the liberalization ofthe economy.

He encouraged the privatization of public entities, to include the modernization of publicinfrastructure through an expanded Build-Operate-Transfer (BOT) law.

FIDEL V. RAMOS

Under Ramos, the Philippinesexperienced a period of politicalstability and rapid economic growthand expansion, as a result of hispolicies and programs designed tofoster national reconciliation andunity.

FIDEL V. RAMOS

Ramos was able to securemajor peace agreements withMuslim separatists, communistinsurgents and military rebels,which renewed investor confidencein the Philippine economy. Ramosalso aggressively pushed for thederegulation of the nation's majorindustries and the privatization ofbad government assets.

FIDEL V. RAMOS

Economy during his term in Administration . . .

ECONOMY

President Fidel Ramosembarked on an ambitiousdevelopment plan dubbed"Philippines 2000." Under the plan,several industries critical toeconomic development wereprivatized, such as

electricity, telecommunications, banking, domestic shipping, and oil.

ECONOMY The taxation system was reformed,and external debt was brought to moremanageable levels by debtrestructuring and sensible fiscalmanagement. By 1996, GNP wasgrowing at a rate of 7.2 percent andGDP at 5.2 percent. The annualinflation rate had dropped to 5.9percent from its high of 9.1 percent in1995. By the late 1990s, thePhilippines' economic growth gainedfavorable comparisons with otherAsian countries such as Taiwan,Thailand, South Korea, and Malaysia.

PHILIPPINE ECONOMY The Philippine economy took asharp downturn during the Asianfinancial crisis of 1997. Its fiscaldeficit in 1998 reached P49.981 billionfrom a surplus of P1.564 billion in1997. The peso depreciated (fell invalue) to P40.89 per U.S. dollar fromits previous rate of P29.47 to a dollar.The annual growth rate of the GNP fellto 0.1 percent in 1998 from 5.3percent in 1997. Despite thesesetbacks, the Philippine economyfared better than that of some of itsAsian neighbors, and other nationspraised the Ramos administration forits "good housekeeping."

ECONOMIC REFORMS During his administration, Ramos began implementing economic reforms intended to openup the once-closed national economy, encourage private enterprise, invite more foreign anddomestic investment, and reduce corruption.

Ramos was also known as the most-traveled Philippine President compared to hispredecessors with numerous foreign trips abroad, generating about US$ 20 billion worth offoreign investments to the Philippines.

To ensure a positive financial outlook on the Philippines, Ramos led the 4th Asia PacificEconomic Cooperation (APEC) Leaders' Summit in the Philippines on November 1996.

He also instituted reforms in the tax system which includes a forced increase on VAT (E-VAT law) from 4% to 10% mandated by World Bank and the International MonetaryFund.

ECONOMIC REFORMS

Under his administration, thePhilippines enjoyed economicgrowth and stability. The PhilippineStock Exchange in the mid-1990swas one of the best in the worldand his visions of Philippines 2000'that led the country into a newlyindustrialized country in the worldand the "Tiger Cub Economy inAsia".

ECONOMIC REFORMS

Other economic reformsachieved during the Ramosadministration was the re-adjustment of the value addedtax from four percent to anInternational Monetary Fundand World Bank-mandated tenpercent. The success of thereforms paved the way for thePhilippines to be called "Asia'sNew Tiger"

ECONOMIC REFORMS

Economic reforms institutedduring the Ramos era enabled thePhilippines to experience growthrates of up to nine percentannually, and enjoy annual budgetsurpluses well into his tenure. Theeconomic reforms instituted inthe Philippines 2000 platform wouldhave an effect on how thePhilippines would be affected inthe 1997 East Asian financialcrisis.

PHILIPPINES 2000 FIVE-

POINT PROGRAM

Philippines 2000 was the socio-economic program of

former Philippine President Fidel V. Ramos. The plan

envisioned the Philippines achieving newly industrialized

country status by the year 2000.

PHILIPPINES 2000 FIVE-POINT PROGRAM

The Philippines 2000 platform largely hinged on five major areas:

Peace and Stability Economic Growth and Sustainable Development Energy and Power Generation Environmental Protection Streamlined Bureaucracy

He implemented economic reforms intended to open up the once-closed national economy, encourage private enterprise, invite moreforeign and domestic investment, and reduce corruption.

EFFECTS AND LEGACY The Philippines 2000 platform waswidely successful, making it one of thegreatest legacies of the Ramosadministration to the Philippines. Ramoswas successfully able to open the then-closed Philippine economy and breakMarcos-era formed monopolies,especially with regard to PhilippineAirlines and the Philippine LongDistance Telephone Company, whichwere privatized and de-monopolizedduring his tenure.

The Philippines 2000 programformed the core of the Ramos campaignplatform in the 1992 elections whichlargely centered on economic reformsand improved national security andunity.

PREPARED BY:

John Henry Madriaga

Joshua Gabriel Buan

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