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Sustainable Development and Globalization in the Philippines: An Alternative View

This paper was prepared by the Philippine Network for the World Summit on Sustainable Development (PHILNET-WSSD) for the Asia Pacific People’s Forum on the WSSD from November 25 to 26, 2001 at The Buddhist Institute, Ministry of Religious Affairs, Phnom Penh, Cambodia. The forum serves as a parallel activity of NGOs and POs to the High-Level Regional Meeting for WSSD also held in Phnom Penh from November 27 to 29. The WSSD will be held in Johannesburg, South Africa in September 2002. Originally 30 pages in length, Bulatlat.com reprints only the main article and excludes the six annexes which depict the country’s economic history and salient past and present policies and programs.

By PHILIPPINE NETWORK FOR THE WORLD SUMMIT ON SUSTAINABLE DEVELOPMENT (PHILNET-WSSD)

Part I | Part II | Part III

Globalization Over Sustainable Development

Then President Ramos revived the stalled import liberalization program of the Aquino regime in 1992, eventually incorporating higher targets for tariff cuts at an ever more accelerated pace—aiming to bring them to 0-5% by 2004 on all products except sensitive agricultural goods.[1] Measure after measure was also taken to liberalize foreign investments, allowing up to 100% foreign ownership in all but a few sectors and complete freedom to repatriate capital.

Foreign exchange controls were dropped in 1993. Water transport was liberalized and deregulated in 1992, telecommunications in 1993, banking and shipping sectors in 1994, airlines in 1995, and retail trade in 2000. The oil industry was deregulated in 1996. Among a host of government assets privatized were oil firms in 1994 and water utilities in 1996. Essential road and power infrastructure was turned over to the private sector through so-called build-operate-transfer (BOT) projects especially following deregulation in 1993.

And of course there was the treasonous ratification by the Senate of the 1994 General Agreement on Tariffs and Trade (GATT) and the country’s subsequent membership in the newly-created World Trade Organization (WTO) in 1995.

More than anything else, including high-sounding paeans to SD, opening up the economy to foreign monopoly capital determined the agricultural and industrial maldevelopment that was. Economic policies have come to be even more dominated by what profits foreign monopoly capital and domestic elites. This is at the cost of what fosters national economic self-reliance, independence and ecological sustainability, and is for the good of the Filipino people.

The country has certainly become more “globalized.” Exports and imports jumped to 101.5% of gross domestic product (GDP) in 1996-2000 from 60.9% in 1986-90. Foreign investments in turn increased 166%, from US$ 2.58 billion in 1986-90 to US$ 6.86 billion in 1996-2000. Yet the people’s welfare, as mentioned earlier, only worsened.

Nor did the country’s industry or agriculture improve. The share of manufacturing in national output fell from 25.4% in 1990 to 23.4% in 2000; the share of manufacturing employment to total employment hardly changed, from 8.9% to 9.0%. Industry remains stagnant and with low value-added.

Agricultural performance was even worse. The sector lost over a million jobs between 1994 and 2000, increasing rural poverty by 690,000 families. Between 1990-94 and 1995-99, rice imports increased by 540%, corn by 320%, poultry by 580%, beef by 230%, pork by 120% and fish by 45% turning a US$ 1.3 billion trade surplus into a US$ 3.5 billion deficit.

And yet landlessness remains widespread with 5% of families owning 45% of total arable land. After 13 years of implementation of the Comprehensive Agrarian Reform Program (CARP), the government has only achieved 68% of its already lowered target of 8.1 million hectares. And most of those redistributed were non-private agricultural lands (non-PAL) where the government did not yet have to deal with its bases of landlord support.

The country’s foreign debt stock leaped 70.3% from US$ 30.6 billion in 1990 to US$ 52.1 in 2000—almost double the increase from the decade earlier. Meanwhile the exchange rate fell 55.1% from PhP 28.50 to PhP 44.20 to the US$ 1; the current rate hovers around PhP 52.00 to the US$ 1.

And yet things can only get worse. The country’s economic surplus—drawn from little more than its cheap labour and raw materials—will continue to be siphoned off by foreign monopoly capital as profit repatriation, debt servicing and technology payments.

With no development to speak of, there is little point in asking if it was sustainable or not. Indeed it only adds insult that the country’s environment has been heedlessly damaged in the process.

A history of environmental degradation

The country’s economy and the way its agriculture and industry have developed are most strongly determined by the neocolonial character of the Philippines: it is a source of cheap labor and raw materials for foreign monopoly capital, a captive markets for its goods, and an outlet for recycling surplus finance capital. The last century of Philippine environmental history offers much insight into what is to come with any further “globalization.”

The nation’s natural resources have been systematically used and exploited for the profits of foreign capital and domestic elites, with very grave implications.

The country’s forests offer stark testimony. First were the decades of US colonial logging with trees cut down across the country’s major islands and turned into logs for export. In the post-World War Two years, deforestation accelerated as economic reconstruction proceeded in Japan and domestically. The tempo was maintained and only slowed in the 1990s when the rate fell to some 200,000 hectares a year—by which time less than a million hectares of tropical rain forests remained from more than ten million in the 1950s.

The damage following such widespread deforestation has been many. A billion cubic meters of top soil erode every year, severe floods happen with alarming frequency, and rates of dehydration during droughts have heightened.

Agricultural land has lost fertility and become acidic because of toxic chemicals from factories, mine tailings and—spurred by the “green revolution” of the 1970s—imported chemical fertilizers and pesticides. Thirty percent of the nations’ rivers are dead from that part of the some 80-150 million tons of hazardous industrial and agricultural wastes per year which make their way to them.

Coastal waters, vital mangrove areas, coral reefs, fish, seaweed and other marine resources have been assaulted by soil erosion and toxic flows from inland and fishing fleets and factory ships from Taiwan and Japan. The loss of marine and land biodiversity has been tremendous and has drastically reduced marine and agricultural productivity.

Part I | Part II | Part III

[1] But already there is a bill pending in Congress to remove quantitative restrictions on rice—the country’s most sensitive crop—and replace these with tariffs starting 2002.

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