The Economy of Philippines

The Philippines is a newly industrialized emerging nation. Its economic growth begun in the late 1950's until late 1960's. Due to political turmoil, its development fell dramatically during and after the Marcos regime. The Asian Financial Crisis of 1997 made it worse for the struggling economy. Exchange rate for a dollar surged to 40 pesos from 26 before the crisis. By 2000, political uncertainties further continue resulting to lowered foreign investments and financial instabilities.

The current Arroyo administration has committed to turn the country into a First World nation by 2020. Passing of the very controversial value added tax (E-VAT) law on November 1, 2005 received different reactions. EVAT was a measure to restrain the increasing foreign debt and to improve government services.

In 2005, the Philippines peso was named as the best performing currency of Asia. Remittances from Filipino overseas around the globe still continue to be the biggest source of foreign income. In 2006, the Philippines collected $12.8 billion compare to the annual average of $2.5 billion received from foreign direct investment. By 2007, its gross domestic product grew 7.3%, the most remarkable feat in 31 years. According to the International Monetary Fund (IMF), the Philippines ranked as the 25th largest economy based on purchasing power parity.

Major industries of the Philippine economy include electronics, garments, food processing, pharmaceuticals, chemicals, fishing, and petroleum refining. Its main export partners are China, United States, Japan, Netherlands, Taiwan, Hong Kong, Malaysia and Singapore. The Philippines is a member of the following financial/economic organizations: Asia Pacific Economic Cooperation (APEC), Asian Development Bank (ADB), the World Bank and World Trade Organization (WTO).