If there is one word in the dictionary that has been greatly maligned, vilified, and tormented in world history, it would be capitalism. Various political and economic theories, together with their believers and practitioners have continuously despised capitalism, but haven’t construed anything pragmatic without capitalism’s wealth generating ability. Naysayers misconstrue the reality that in the history of human beings, no economic system has single-handedly lifted hundreds of millions of peoples all over the world out from poverty and economic hardship that doesn’t take capitalism in to account. Capitalism, which transformed and eventually became more inclusive through the years, has always proven itself victorious in disproving those pundits. How did then capitalism come to fruition, and why should Filipinos make it work?
One of the earliest forms of capitalism was the commenda system of the Venetians during the early years of the second millennium. As a burgeoning mercantile city-state in the Italian peninsula, venturing out of the Adriatic Sea through trade was both a profitable and a dangerous undertaking. Maritime trade was profitable because imported goods can be sold at exorbitant prices, but dangers lay ahead. The intolerant Saracens were controlling major cities in the Levant, while the suspicious Byzantines had centuries of experience in mastering and controlling the Mediterranean. This commenda system tied a rich investing merchant to another adventurer, where profits would be split between the two parties. According to Tilly’s book Coercion, Capital, and European States, the commenda helped Venice accumulate and concentrate capital, while renowned economists Acemoglu and Robinson in their book Why Nations Fail quickly pointed out this system as an evidence of Venice’s inclusive economic institutions.
Capitalism later evolved in The Netherlands during the 17th century when the Dutch East India Company was formed, creating the blueprint of what a stock market is. Unlike the Venetian commenda system, risk and profit were distributed more or less equally among the stockholders, incentivizing more individuals to take part in the market of buyers and sellers. As what Tilly has mentioned, capital concentrated and accumulated in major Dutch cities like Rotterdam and Utrecht, with Amsterdam serving as its financial hub. However, the Dutch observed coercive practices to subjugate modern-day Indonesia, where they found means to monopolize markets and global trade. Nevertheless, The Netherlands was generating ridiculous amounts of wealth, which eventually led to the adoption of the Dutch guilder as the world’s reserve currency during their golden age.
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Speaking of reserve currencies, the British pound and the American dollar became the currencies of choice in the 19th and 20th centuries, respectively. This was primarily due to their economic strength, where they have adopted capitalistic policies and let the free market run its course. They have embraced individualism, where innovation, technological progress, and creative destruction were financially incentivized by the markets. A protectionist stance in global trade was generally frowned upon, and even up to this day, capitalistic policies have governed modern-day societies. Even Communist China, through Deng Xiaoping, was compelled to reform their economic institutions, which resulted to the exponential economic growth of the People’s Republic.
Inclusive economic institutions begin with wealth generation as one of its basic tenets. Even prominent investor Ray Dalio in his book Principles for Dealing with the Changing World mentioned that as an economic system, capitalism has significantly improved the living standards of ordinary men and women, albeit wealth gaps should also be addressed accordingly. With such realities, how can capitalism work in the Philippines? Luckily, British stateswoman Margaret Thatcher in her book Statecraft mentioned five prerequisites, all of which are of utmost importance, that will make capitalism work in any country. These are rule of law, culture of entrepreneurship, private ownership, competition, and limited government intervention. By observing these, the administration of then-Prime Minister Thatcher was able to pull the United Kingdom out from the economic doldrums of the 1970’s and led the transformation of London into the world’s premier financial hub.
Fortunately for the Philippines, entrepreneurial culture is present in the Philippine society, as ordinary Filipinos find ingenious ways to sell their products in the market. In addition, private ownership is allowed in the country, where everyone is free to acquire and purchase properties. However, there is much more to be desired when it comes to the remaining three prerequisites that the Britain’s Iron Lady has enunciated.
First would be the rule of law, where justice would be delivered promptly, thus incentivizing all individuals to abide by the provisions accorded by these written laws. With the powerful and wealthy elites influencing how justice should be arranged instead of being executed, they can afford to simply ignore these laws without thinking about its accompanying repercussions. Second is about competition, where private companies are compelled to outwit and outlast other companies by not engaging in monopolistic and monopsonic practices. Despite having a competition commission, the Philippines has a long history of cronyism, thus further structural changes are required to avoid such collusions between companies and their political backers. Finally, minimal government intervention should also be observed, where the administration must refrain from spreading its capabilities, powers, and resources thinly. With a number of Filipinos possessing a mindset that the government will come to their rescue by resolving their problems, a paradigm shift is needed from the populace if the Philippines is to have a strong, effective state.
If the Philippines is meant to make capitalism work for Filipinos, it would boil down to enlarging the pie through unprecedented economic growth by generating wealth and employment opportunities. With the country’s present financial limitations, greatly lowering the hurdles of doing business in the country is of significant importance. Making the Philippines an attractive destination for foreign direct investments is the low-hanging fruit to expand the economy. Economic protectionism, which has coddled the landed gentry and the oligarchs for numerous decades didn’t generate the desired outcome, thus it must be scrapped. Allowing these entities to be exposed to international competition will compel them to shape-up, lest lose employees and market share. After all, the market regulates itself through the ebbs and flows of supply and demand. Elimination of the 60-40 business ownership stipulations from the current 1987 constitution would definitely assist the present administration in attracting more investments.
Philippine capitalism will only work if systems are in place that incentivizes all members of the economy to take part in the free enterprise. A capitalist system, which rewards hard work and competition, is a trademark of what inclusive economic institutions are ought to be. Nevertheless, this begins by reforming the highly restrictive economic provisions of the 1987 constitution, which has failed to bring employment opportunities to the marginalized sectors of Philippine society.
A no one who enjoys the fun things of life in private.
A believer of freedom, capitalism, and conservative brand of politics.
A no one who cares less about popular public opinion.
A believer that life can be better, if every one is a tad more responsible.
You say “…it would be capitalism.”
I say “…it would be socialism.”
Capitalism has lifted many people out from poverty and economic hardship. That’s True. But not without any cost. You simply deny or forgetting that raw capitalism comes with a price.
The cost for the western world to be rich was at the expense of african and asian lives and resources.
Strong government intervention must exist in a capitalistic society or else capitalism will make sure that the gap between rich and poor will widen.
And any competition without intervention will surely create monopoly.
China is not and has never been a true capitalist nation. Hence you can not use China as an example that capitalism works.
UK during the Thather era made many Britons poor while few got rich. The world’s premier financial hub is due to foreign citizens sitting on riches while the true brits were poor. Hence you can not use Thatcher as an example for the Philippines to follow.
But maybe… just maybe i would agree that a charter change would be a good thing for the country.
True capitalism will never occur due to the horrible education system and blatant corruption. At best, you have crony capitalism with some socialism mixed in. I tell all my friends NOT to invest in the Philippines.
Philippines can start its path to greatness only if all forms of protectionism are abolished. As long as protectionism is still in Philippines, it will always be a third world country with high cost of living. The constitution needs to be amended to repeal the Filipino first policy, investors should be given equal chances and privileges whether foreigners or locals. Protectionist advocates never learned from Lee Kuan Yew and Sir Donald Tsang when it comes to protectionism. Associating protectionism with nationalism is idiotic because it’s same with willing to get hurt to support garbage products from companies which don’t even care about their customers. Philippines is not a 100% capitalist country and protectionism is a recipe for disaster.
How to make capitalism work in the Philippines?
How about electing a president who has the Economics Expertise to accomplish this: Leni
It’s that simple really.
Leni 2028! Hindi pa tapos ang laban
LOL I think nowhere else can one achieve so many doctorates. It’s so obvious that the quality of education in the country is so low since one can be a doctor of so many different fields.
Sandro Marcos 2028 for president…
Sorry pinklawan woke LGBT gay, Leni lost because of our big support in Uniteam!
This article implies that capitalism is not working in the country hence she has lots of problems which is really far from reality. I say, capitalism works but in the case of the Philippines it has not really reap the benefits for the common man simply because there are other problems that weigh in on her from becoming successful. Just take the population explosion as an example, no matter how good capitalism is, if you have a lot of people to feed on and no jobs available, things will remain dire.
Same with the idea of going “path to greatness” if we abolish protectionist policy in the country. Another misleading and misdirected effort at looking at the problems presented as a magic wand to make all that ails the country disappear. Small and weak countries need protection against economic behemoth. Not all countries are the same as Singapore, geographically, politically, etc. so it really doesn’t make sense to compare her with another.
Let me cite some of the more urgent problems the country has where ideas, fresh ones, can be inputed to make a realistic analysis of the situation.
-Population explosion
-Graft and corruption in government
-Problems on education that extends to management, quality, budget, brain-drain, facility requirements, etc.
-Amendment of the constitution pertaining to economic parity and other aspect of good governance.
-The ever growing poverty and homelessness in the country
Capitalism? Let’s not bother with that right now. It’s a system that, while working as expected, has not reach its potential because of other factors that must be address first before it becomes relevant to make an effective contribution to the prevailing problems the country has.
In short, let’s not bark on the wrong tree.
@Juan Lun the capitalism in Philippines is not a good capitalism. The corruption, laziness and incompetence should be abolished. Protectionism proves incompetence. Time itself proved how harmful protectionism is. There are gov’t officials who are considering relaxing protectionist policies which is why the 60-40 foreign business ownership rule was relaxed before Duterte’s term ended. By the way, Hong Kong removed the protectionism, Finland, Norway and Sweden allows full foreign business ownership. Even if you’re not a resident there, you can buy a land to start a business. Philippines should allow foreigners to own lands, just like those Nordic countries. If you want low quality products, then go ahead, buy them, be my guest, but don’t force people to buy low quality local products or pay hefty taxes for better products, that’s purely selfish and inconsiderate. Besides, more foreign investment, more revenue for the gov’t. Who cares about local brands anyway? Having a local brand or not is irrelevant, especially if it’s causing grave harm to the country and the people. Protectionism in Philippines raised the cost of living without raising the salaries. Cost of living in Philippines is same with cost of living in first world countries and protectionism and corruption are also to blame for that.
Granting that what you are saying are true, don’t you think topnotch economists and business people are not aware of what you are talking about? As for me, I’m not sold to the idea you are selling because you are comparing apples to oranges. I mean, the idea you are espousing is not an impossibility but the way you sell it don’t pass the smell test. Hong Kong and those other European countries are not on the same level with RP. Their history, financial and political as well as geographic and demographic features are way, way different.
I say, go slow on recommendation that at best is suspicious if not actually questionable.
Of course what I’m saying is true. Protectionism needs to be abolished asap because it’s just hurting the customers, and for what? If you ask me, as a customer, I just want what’s best for me, I don’t want to sacrifice my money just to help the companies which are failures. I just want to be able to buy what I want without being forced to help anyone who’s too lazy to improve or innovate. Besides, as long as customers are happy, then nobody should care about failing companies because they can’t handle competition. I don’t think the officials handling the economy are doing good enough for the country whether they’re aware of what I’m saying or not because if they do, then they will do whatever they can to remove all forms of protectionism immediately. If they want protectionism, then are you sure they’re topnotch?
Dream on!
If you’re still a protectionism advocate, then dream on about Philippines being great. Oh wait, forget your hope and dream of Philippines becoming a great country in the future. As long as the unfair protectionist system is still there, then that country will always be a big dump. Singapore is a rich country, but do you know how poor Singapore was when Lee Kuan Yew did everything he can to attract foreign investors? It’s funny that protectionist advocates claim they support capitalism, yet they’re quick to advocate protectionism whenever they can’t handle the competition.
It’s funny also, Singapore under Lee Kwan Yew is a protectionist state. Lee can’t handle competition, that’s why he ruled as a Dictator for more than thirty long years and the turned Singapore into a one-party system.
Can you define exactly what is Protectionism and not in the point of view of a selfish consumer (your reality) but rather in the perception of a head of state (the other reality)?
@No Entry actually, Singapore is the first ASEAN country to make aggressive foreign investment. Lee Kuan Yew also stressed the importance of free trade.
https://correctphilippines.org/filipino_first_fail/
You dare say that the consumer point of view is selfish? What will consumers get by sacrificing their money to support local products? Nothing, they’re just getting hurt by the effects of protectionism.
“Any economist will tell you that when you keep foreign business out you simply hurt your own people,” – Sir Donald Tsang
Is it the customers’ fault that the local companies can’t compete? It’s not, so they should not burden the customers for the local companies’ inability to beat foreign companies in competition.
Instead of talking about Singapore, protectionism, etc. why not explore the scenario wherein leaders instead of countries should be interchange. For example, can Lee Kwan Yew, as its president, run the RP and yield the same result as he did with Singapore? And would Marcos do the same and succeed with Singapore?
To avoid boredom why not try to explore and connect that to your theory and see if it will make sense.
@Juan Luna read these which will invalidate the arguments of protectionism advocates.
https://makingitfuninthephilippines.blogspot.com/2016/04/refuting-top-seven-protectionist-lies.html
https://makingitfuninthephilippines.blogspot.com/2015/04/the-bitter-irony-that-failipinos-love.html
https://makingitfuninthephilippines.blogspot.com/2016/02/ultranationalist-economic-policies-hurt.html
https://makingitfuninthephilippines.blogspot.com/2021/11/the-blah-blah-blahs-of-anti-reform.html
Credits to Sean Akizuki for these articles, he’s the author.
Like I said not so long ago, if you want low quality local products, then be my guest, don’t force it to other people by wanting to limit their choices to local products or pay unfair taxes for buying foreign products.
So they want to reduce operating costs by minimizing the number of laborers… in a system where the source of livelihood is labor. And investors create jobs? There’s so much contradiction that it just implodes on its own.
When we speak of Protectionism for certain economic sectors vital to the state, it doesn’t necessarily mean we are against Free-Trade. That we regard Foreign-Direct Investments (FDIs) as foreign intervention. That’s idiotic. It’s intellectual dishonesty even. And that is what No Data is trying to impress with his very narrow tunnel vision of sorts. Not so smart really, in fact it’s weak thinking.
Don’t listen to a poseur! Here’s the real story: How to Enrich a Country: Free Trade or Protectionism?
https://www.youtube.com/watch?v=5ITyd1Pzek0
When No Data trumpets his favorite economic model specimen being Singapore’s success and what Lee Kwan Yew did, he only talks about the Parliamentary System and the FDIs as if it is a magic formula that will make wonder for every country in the world.
Will LKY be able to do the same for, say, to an African state and make it like Singapore? I don’t think so.
He’s not even talking of other considerations that made it work for Singapore. I doubt he knows about the relation of geography and its dynamics to a country’s socio-economic success or to it’s military’s defensive capability. (Think, why is the US mainland never invaded or a tiny country like Singapore or The Netherlands are both rich?)
Many Filipinos (No Data and his idol Sean Akizuki included) praise LKY for his success in Singapore but many downplay and ignore the importance of the fact the he also ruled with an iron hand, virtually turned Singapore into a one-party state and ruled the country for many years with no opposition (two options for them, either jail time or bankruptcy).
To make it happen, there’s imposition of government control and intervention, a lot of it, which played a major part of that success. What’s funny with many of these same people who love LKY is that they will not allow a Filipino leader to do the same as what LKY did. Tsk…tsk…
Clueless No Data asks: “What will consumers get by sacrificing their money to support local products? Nothing, they’re just getting hurt by the effects of protectionism.”
Well if protectionism is bad, why is it the chosen economic policy of the UNITED States’ President Donald J. Trump to make her great again? The economic model that made the US the world’s unrivaled powerhouse beginning in the pre- and post-World War periods.
If protectionism is really bad, why do once-poorer neighbors like Taiwan, Malaysia and Thailand took the same protectionist, nationalistic developmental strategy that enabled them to transform into the newly industrialized countries that they are today.
You see, in a given situation, a smart balance of free-trade and protectionism allows a country to industrialize!
Again, nothing really?! Think about it, what could have been for the Philippine Steel Giant if only former President Fidel Ramos (aka Boy Benta) did not listen to the ramblings of a certain lazy thinker like No Data?
There’s an interesting piece written by Prof. Cecilio Arillo about the so-called “The Dodds Report”:
“The Dodds Report explains the continuing obsession to this day of US foreign policy to keep the Philippines a free and open market for imports because a liberal import policy—another name for free trade —ensures that this country will never be able to industrialize.
“Conclusive proof of what Recto described as America’s “anti-industrialization policy for the Philippines” came when former President Ferdinand E. Marcos formally launched an industrialization program in the late-1970s based on 11 heavy industries led by the steel, petrochemical and engineering industries.”
I guess, you can read more about it from his books.
Lazy thinker you say? You’re resorting to ad hominem again No Entry. Don’t you see, it was proven by time itself that the Filipino protectionism is causing harm to the country. Maybe you should listen to what Sir Donald Tsang again. “Any economist will tell you that when you keep foreign businesses out, you simply hurt your own people,” – Sir Donald Tsang. There are foreign factories in the US and China. Bahahahaha, it’s really funny that protectionism advocates in Philippines hate the bad products and services they get, yet they support the Philippine protectionism, many of them also conplain about losing jobs yet they support Philippine protectionism, these are what Sean Akizuki said. FDI is not a magic formula, but keeping them out of the country and retaining the high degree of protectionism are recipes for disaster. For example, what happened to Filipino car brands, did they succeed despite the protectionism? Protectionism is also the reason why commodities in Philippines are expensive. Support local? That’s rubbish, support brands which give you the best offer. Hong Kong also attracted FDI too. The difference between LKY and most Ph gov’t officials is LKY really loved his people more than most Philippine top gov’t officials do.
Economist poseur and lazy thinker No Data really has No Brain if he thinks the “Philippines can start its path to greatness only if all forms of protectionism are abolished.” Yeah, the same arrogant Mr. No Data who frequently declares: “Associating protectionism with nationalism is idiotic.”
But first, he needs to answer this question: Is FDI not allowed in the country? A simple yes or no would be fine.
He should asks his idol Sean Akizuki the same and Mr. Donald Duck, Hong Kong’s former chief executive, who failed to remind himself about “his conflict of interest”, being a public servant, which led to his becoming Hong Kong’s highest-ranking official to be jailed.
Here’s the real deal which offers a much better explanation (small to big caps, for emphasis, are mine):
Why the Philippines Failed? A Developmental Perspective
Posted on April 18, 2013 Author Richard Javad Heydarian
No Data, with his narrow and simplistic economic viewpoint based only from the articles of Sean Akizuki, can read and weep:
“In Why Nations Fail, economists Acemoglu and Robinson provide a brilliant explanation on how progress and development is largely a function of inclusive — as opposed to extractive — governance. Using their dichotomy, the Philippines clearly falls within the extractive category, whereby the CORE-ELITE have BLOCKED APPROPRIATE POLICIES, which would have made the country a true democracy, anchored by a large middle class, an entrepreneurial sector, and strong institutions spurring growth and innovation.
“… in many ways, the developmental failure of the Philippines has something to do with its weak and divided state, which seldom had the right policy space to make optimal economic decisions. THROUGHOUT THE POST-WAR PERIOD, THE PHILIPPINE STATE HAS EITHER BEEN AT THE MERCY OF ENTRENCHED ELITES, PUSHING FOR PARTICULARISTIC INTERESTS AND BLOCKING POLICIES/LEGISLATIONS AIMED AT NATIONAL DEVELOPMENT, OR INTERNATIONAL FINANCIAL INSTITUTIONS (IFIS), WHICH HAVE PRESCRIBED COUNTERPRODUCTIVE POLICIES, NOTABLY STRUCTURAL ADJUSTMENT PROGRAMS (SAPS), CAUSING TREMENDOUS POVERTY, SOCIAL DISLOCATION, AGRICULTURAL DECLINE, AND DE-INDUSTRIALIZATION ACROSS THE DEVELOPING WORLD. Sometimes, the Philippines was at the mercy of both.
(Those IMF imposed conditionalities… Isn’t the above statement kinda reminds us about the Dodds Report?!)
“…, CHINA, and JAPAN had relatively strong states, which transcended particularistic interests and rejected simplistic policies by the IFIs. If anything, THEIR ECONOMIC MIRACLES HAD NOTHING TO DO WITH FOREIGN DIRECT INVESTMENTS (FDI), nor with mindless dissolution of trade barriers and strategic industrial policies, as prescribed by the IFIs and market-fundamentalists (A.K.A.: Neo-liberals). AT THE HEART OF THEIR SUCCESS lied one thing: a strong developmental state, which (a) judiciously provided subsidies, TRADE PROTECTION, and benefits to identified strategic economic sectors based on a strict performance-based scheme, the so-called reciprocal mechanisms, while (b) ensuring technology transfer from foreign investors to local producers, and (c) astutely negotiating trading agreement that secured market access to major Western markets.”
https://www.getrealphilippines.com/2013/04/why-the-philippines-failed-developmental-perspective/
@No Entry, you have zero credibility the moment you used personal insults or ad hominem against me, all of your points are wrong. I already showed my sources, about what sir Donald Tsang of Hong Kong said. No Entry’s stubbornness is really disgusting. Come on, this is a civil discussion and debate, ad hominem and personal insults are not allowed. Do you even have knowledge about economics? Because you don’t seem to notice the effects of long term protectionism in the Philippines. FDI is allowed in the Philippines, I never said it’s not allowed, the problem is it’s too restrictive and unfair in favor of Filipino businesses.
Why not heavily lower tariffs and allow foreign businesses to own lands in the Philippines to help them invest? Philippines is even too slow to take part in the RCEP which will really be beneficial to the country.
Like I said, look around you, observe carefully, gadgets, electronics, cars and branded shoes are expensive in Philippines, and protectionism is one reason. If the 60-40 rule foreign business ownership never existed, then Philippines would be better. I never said FDI is magic, you’re assuming that I think that. FDI will help the country improve and earn income. You didn’t even tell me the benefits of the long term protectionism in the Philippines which outweigh the negative effects.
@No Data: “all of your points are wrong.”
Will you be kind enough to enumerate what are those points exactly and why do you think they are wrong? Please be more specific.
Protectionism does not need to be a bad thing.
EU, China, Russia, USA… they all use some form of protectionism.
Some, lesser extent than Philippines. The difference is unlike those countries, there are very few people in Philippines who can build enough businesses to provide enough jobs to make significant improvement on the country’s labor conditions. Also, one reason why internet in Philippines is expensive and slow compared to US and Europe is lack of competition. If foreign investors are allowed to build businesses in Philippines without anything unfair towards them and if they’re allowed to own lands, then it should help encourage foreign ISPs to build businesses in Philippines which will improve internet speeds and reliability, and Philippine ISPs will be forced to improve their services without extra costs or close down. Foreign businesses dominating in the country is better in every way than being forced to endure bad services and products of local companies at similar costs or worse just because there are unfair restrictions against foreign companies just to give local companies a chance.
@No Data: “one reason why internet in Philippines is expensive and slow compared to US and Europe is lack of competition.”
Are you sure of that? Well, the above statement is simply not true at all.
Duopoly PLDT and Globe two of the biggest telcos in the country are run by the state firms NTT of Japan and Singtel of Singapore.
Based on the authoritative “State of the Internet” report of 2017 by Akamai Technologies, Japan and Singapore have the highest average Internet speeds in the world.
In a more recent Median Country Speeds October 2022 ranking from Speedtest Global Index, Singapore is still on top while Japan still in the top ten.
https://www.speedtest.net/global-index#mobile
Now why is it that we still have the slowest Internet in Asia while other countries like China, Vietnam and Indonesia have all overtaken us in Internet speed?
In one of his commentaries, Mr Tiglao even compellingly asks: What’s so different about our telcos from those in Asia?
Nearly all of them are owned and run by state corporations, even if some of them, like NTT and Singtel have in the past 10 years taken minority foreign shares.
NTT and Singtel in fact have grown into global firms as they were coddled by their governments to be monopolies in their countries.
Will you submit then that the above mentioned countries, as a matter of economic policy, did employ some form of protectionism?
While the more decent-minded filipinos aspire for nation-building and for the country to industrialize (the Philippine Steel Industry Giant could have lead us to something more- ship-building, airplanes, locomotive, cars, etc.), world citizen poseurs still concern themselves with gadgets and other personal consumerism.
And it’s funny they still don’t even get it that they’re expensive because they’re imported items.
Oh yeah? These articles also point out the lack of competition.
https://www.vice.com/en/article/n7vy3m/why-internet-speeds-philippines-slow-laws
https://businessmirror.com.ph/2017/04/17/slow-internet-connection-philippines/
http://www.wazzuppilipinas.com/2015/07/the-real-reason-why-internet-is-slow-in.html?m=1
Why are there administrations who attempted to invite foreign telcos to start internet businesses in Philippines? Arroyo tried to invite ZTE, Duterte once threatened the Philippine telcos to improve services or face competitors from China. Duterte also signed an EO which allows full foreign ownership of telcos.
By the way, when you said that China’s economic miracle has nothing to do with FDIs, you were wrong there. Mao Tse Tung closed the Chinese market, then Deng Xiaoping led China away from Maoist ideologies and planned economy, and opened the country to foreign investments and technology.
More decent minded Filipinos aspire for the country to industrialize? By protectionism? How can Philippines build their own ship, airplanes, cars, etc? Philippines has exceptionally few intelligent people to build those because many Filipinos leave the country for decent salaries. Even the president Marcos Jr. asked Filipinos in other countries to come back to Philippines, but what’s in it for them? Most Philippine products are crap, such as Philippine phones compared to iPhone and Samsung, even the first Filipino supercar is a joke, it’s more like a supercrap than a supercar. Highly skilled Filipinos will have good opportunities to work or even migrate in better countries simply because they have no future in the Philippines, unless they’re benefiting from the extreme corruption there.
https://www.getrealphilippines.com/2016/03/migrate-now-government-inefficiency-philippines-chokes-entrepreneurship/
People who want other people to suffer either crappy products and services or pay high taxes to get foreign products due to protectionism is just a selfish mindset. It doesn’t matter if Philippines has no local car brand, aircraft brand, ship building brand, being able to buy products or services at no additional cost due to protectionism taxes is what matters a lot more than having the so-called national pride of having local manufacturers which are unable to compete against foreign manufacturers. Oh, since you mentioned car, let me say a brief history here. There were Filipino car brands, Sarao and FMC, but their cars are horrible, foreign competitors defeated them.
Another reason why protectionist measures should be abolished is to give more Filipinos job opportunities with decent salaries.
@No Data: Are you just being confused or are you fooling us?
You habitually claim a lot of things:
“Of course what I’m saying is true.”
“Protectionism proves incompetence.”
“Protectionism is a recipe for disaster.”
“Protectionism needs to be abolished asap.”
“Associating protectionism with nationalism is idiotic.”
But apparently you’re projection of yourself as an all-out anti-Protectionist advocate is becoming dubious.
Here’s why:
1.) To prove a point, how come you’re asserting now, that, “Arroyo tried to invite ZTE” and “Duterte once threatened the Philippine telcos to improve services or face competitors from China”?
Isn’t the above assertion belies your own posturing of near total abolishment of all forms of protectionism? It’s what you’re loudly saying here in this forum, is that correct?
Isn’t it already an admission on your part that the Philippines economic policy is not an all out policy of protectionism?
As a matter of fact, there are other players like Converge and Starlink. According to a report or press release, SpaceX-owned Starlink’s Philippines unit has set out its plans to cover the whole country with its satellite-based Internet service by mid-2023.
And now for the reality, will they bring prices down? You tell us!
https://www.yugatech.com/news/prices-of-starlink-satellite-internet-in-the-philippines/
Your third given link, while it does also mention the seeming lack of competition, it never mentions the existence of other players obviously operating in the country. I’d say, among those three articles, it’s the give away why internet speeds and prices in the country really are what they are. If you really want to know, just read about it there if you still haven’t.
2.) You also said: “Protectionist advocates never learned from Lee Kuan Yew and Sir Donald Tsang when it comes to protectionism.”
With regards to the state of internet in the country run by the state firms NTT of Japan and Singtel of Singapore, are you now saying that we should emulate and adopt their protectionist policy?
Isn’t Singtel of Singapore owned and run by a state corporation? And in the case of China, it has several telecom state firms to compete among themselves, namely, China Mobile, China Unicom, and China Telecom.
Both countries employ protectionist policies, aren’t they?
One reason, among other things, Singapore has more FDIs than the rest, owes it to its being the West’s gateway to Asia.
It’s Political Geography 101.
@No Data
Ofcourse it should not be solely filipino businesses that has the responsibility to make significant improvement on the country’s labor conditions. It is also the workers themselves and the state/government that should be involved in making improvements.
I agree that foreign companies should be allowed to buy up filipino businesses. But I think it is not because of lack of competition that the internet speed is slow. It’s more likely because the filipino internet market is too weak/small; Not many can afford it. Why should foreign investors set up business in the country when not many can afford to buy their stuff.
Removing protectionism can help Filipinos by giving them more job opportunities which can make them afford internet even more. How can the workers improve the salaries if finding a job in Philippines is hard and salaries are low? The gov’t on the other hand should significantly reduce taxes to reduce cost of living in the country and to attract foreign investors more. With foreign telcos competing, that should force Philippine telcos to improve their services significantly.
Removing protectionism does not necessarily make foreigners invest in the country.
The workers can improve the salaries by demanding it from the employers. It’s called agreement between workers and employers. Or else workers can do union strike.
Something costs so much because it’s expensive to produce or build. Something won’t be made because it’s not profitable enough for investors even though it will free up costs for the ordinary person. What is it really?
If I understand the question correctly, its essentially because workers don’t get enough in salary.
If the basis of all activity and decision is around capitalism, what is the relevance and purpose of all learning if resources are mostly channeled by way of the so-called free market? Can anybody even properly define a free market in a system with finite resources?
The basis of all activity and decision is not around capitalism. The basis of many activity and decision is around capitalism.
In reality free market do not exist since it means a market without any intervention, laws or regulations. People really can define free market in a system with finite resources, they just turn the blind eye for all it’s faults. Free market is definitely not a good idea in search for the good economic system.
Lol. The doublethink of capitalism being the most derided thing even though it’s the standard model for economic development.
Now try this article with keynsianism
Pure or raw capitalism is not the standard model. The fact is, it is mixed economic systems that are the standard model. A mixing of both capitalism and socialism.
Nope. It’s capitalism spiced with a bit of marxism. Not specifically socialism. Saying it’s just a mix of both is framing them as equally important when they’re not.
“Socialism is a form of economic production whereby workers co-own and co-produce goods and services and share in the profits. But the definition has recently been conflated with statist forms of government. Under this definition, the government owns and controls major industries, while the economy is centrally planned. As such, the government provides the majority of goods and services for its citizens.”
The quoted definition is exactly what some parts/sectors is about while the rest is capitalistic in nature. Try read it again…
Try reading the definition again and my statement before saying that I should try reading it again. The capitalism part is clearly more important. The preferred model is clearly not a centrally planned economy but capitalism with some government intervention like copyright laws, rights enforcement and maybe welfare – not pure free market but approximating it and is clearly closer to the preferred model than government-controlled major industries – none of the above government interventions being industries. So unless things like having police (which preceded the invention of socialism) is somehow socialist and rights are somehow uniquely socialist, I’d say the capitalist part is more important than the socialist part of the mix. Curious that Keynsianism which is arguably more important than socialism doesn’t have this level of conflation that all government intervention is socialist. Probably because they aren’t as political as capitalists or socialists on the false dichotomy they created between the two at the exclusion of other economic systems that ever existed. Ergo, it’s only a dichotomy of identities not a real dichotomy.
@SameGuy
It’s strange to me that you think police is less important. Advice: Be careful not to be too blinded by the capitalistic light.
Government intervention, action – even its existence – is socialist. Without government it is free market; I also call it anarchy, in my opinion.