I was going through My Hiding Place (http://myhideaway04.blogspot.com)and I read an interesting blog entry. The entry was asking the question, what prevented the Philippines from becoming an economic tiger. Here are my responses:
Pre World War Two, Asian countries were predominantly feudal in nature, where a small number of families controlled the economy.
The four great dictators of Asia just after the war: Marcos, Park, Lee, and Soeharto all tried to smash feudalism by creating their own.
Marcos was basically cold towards the existing feudals just before he declared martial law. Most of them went abroad or stayed put but consolidated their holdings and avoided expansion, lest they incur the ire of Marcos and his cronies.
His cronies were there to, among other things, break the monopoly of the older families.
Most of the Korean Chaebol directors were either relatives or cronies of Park Chung Hee. Most of the leading families in Singapore also were close associates of Lee Kwan Yew. In Japan, it's a different thing. The Kieritsus like Mitsui, Sumitomo, Koban, etc. are owned by noble families, some are more than 400 years old.
Why the other countries managed to industrialize while the Philippines was left in the mud is still a mystery to some. It certainly wasn't due to lack of effort. Marcos built the following:
• The biggest copper smelter in Asia
• The world's biggest nickel refiner
• The biggest cement plant in southeast Asia
• The biggest food terminal in southeast Asia
• A nuclear plant
All these were started by Marcos and his cronies but the grand industrialization plan just didn't pan out.
After Marcos left, the old families were back, and what do they have to show for it?
• Two business districts
• A very big beer brewery
• Several sardine and corned beef canneries
• An outmoded telecom company
• A cheeky TV station
The new families (mostly Tsinoy) haven't contributed much besides upgrade commercial and retail trading activities in metro Manila. Malls, malls and more malls. More sardine canneries, a new beer maker, etc., etc.
I hope this helps unravel the mystery for you why the Philippines did not become Asia’s next Tiger economy.
• Its one thing to perceive the results of the failure of our elite, which has spilled to the general populace.
• It is yet another thing to realize what they have done wrong.
• And it is yet another thing to know what to do to change things.
• Filipinos have this sense of powerlessness and have gone overseas for greener pastures.
• What if the Marcos cronies did a better job of using plundered resources?
• If the Marcos cronies succeeded, we would not detest Marcos at all. Most people don’t know it, but Marcos is the most effective President we have had since the 1960’s.
• What if the elite (old and the new families) invested in more value added industries such as manufacturing, agriculture, software development, etc.?
• We would have a fighting chance. But the truth is, the elite feels powerless against globalization that is why they would rather build businesses in retail and distribution. Of course there are a few exceptions.
• Collectively we have a hand in this failure. But it is not enough to perceive the results of this failure. It is necessary to change, to do this we need to realize our failings, which we seem to pin on others. Stop! Think about it.