In the mid-1960s, the Philippines’ industry was on the same level of development as South Korea and Taiwan, but it slipped soon after. But since the 1990s, the export industry has grown in importance. The most important industries are food processing and the manufacture of electrical and electronic products, chemicals, clothing and metal products.
Japanese car manufacturers such as Toyoto and Mitsubishi produce around 50,000 cars a year in the Philippines. In 2014, however, they considered moving their factories to other countries in Southeast Asia where the cost situation was lower.
There are also a few heavy industries, such as a copper smelter. The industry is highly concentrated in the area around Manila and the southern and central parts of Luzon.
In order to promote the export industry, several tax-free zones have been created. There, among other things, there are contract manufacturing of electronic components, textile products, etc. The companies, which employ over a million people, are allowed to pay wages that are below the statutory minimum wage. Initially, it was primarily US and Japanese companies that established themselves in the zones, but investment from other Asian countries has increased. The industry is also facing increased competition from China. However, exports of industrial goods increased in early 2014.
- COUNTRYAAH: List of top trading partners of Philippines. Includes countries that imported most shipments from and exported most goods to the country.
In recent years, it has become common for service companies to establish themselves in the export zones as well.
Traditionally, the Philippines has a trade deficit, ie imports are larger than exports. From 2003, the deficits grew, as export revenues fell at the same time as oil and food imports became more expensive and more and more consumer goods were imported. In 2013, it amounted to over $ 18.5 billion, according to the International Monetary Fund (IMF).
At the same time, the Philippines has a significant current account surplus due to the large sums – totaling more than $ 25 billion in 2013 – that Filipinos working abroad send to their families in their home country. The United States and Japan have been the country’s most important trading partners for many years. However, trade with China and other Asian countries has increased.
In January 2010, a new FTA entered into force between China and the six ASEAN members Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand. Under the agreement, import duties on 90 percent of the commodities in the free trade zone are eliminated. In terms of population, the free trade area is the largest in the world and covers 1.9 billion people.
In 2010, China became the Philippines’ third largest trading partner, after the United States and Japan. Trade between the countries increased by over 35 per cent only between 2009 and 2010.
In 2013, exports of electrical and electronic equipment (mainly computer chips and microprocessors) accounted for just over a third of the country’s export revenue. However, a large part of the products are only assembled in the Philippines and many parts must also be imported, which affects how big the actual income will be. Imports largely consist of parts used by the electronics industry and various capital goods as well as oil. In the early 2000s, exports of minerals increased, but it declined in 2009 due to lower demand in the world market. Agriculture now accounts for only a few percent of export earnings.
FACTS – FOREIGN TRADE
US $ 51,674 million (2018)
US $ 100,710 million (2018)
– US $ 7,879 million (2018)
Commodity trade’s share of GDP
55 percent (2018)
Main export goods
electronic equipment, including computer chips and microprocessors, iron, steel and other metals, vehicles and other transport equipment
Largest trading partner
China, Japan, USA, Saudi Arabia, Singapore,
The magnificent landscape and elongated beaches attract tourists to the country. Many people also visit Manila.
In the country there are seven places classified as a World Heritage Site by the UN agency Unesco, including four Baroque churches erected in the 16th century, the Ifugao Rice Cultivations and the Tubbataha Reef Marine Park National Park with its unique coral reefs.
In recent years, efforts have been made to attract more and more foreign tourists to the country, and the number has increased, from just over 4 million visitors in 2013, to just over 7 million in 2018 (the figures also include Filipinos living abroad who travel home on holiday). In 2013, $ 280 million was invested on new roads between the tourist attractions. Duterte’s government is also investing in tourism.
However, mass tourism has its price. In April 2018, the soiled island of Boracay was closed to all tourism. For six months, the infrastructure would be improved, the sewerage built, the illegally erected buildings demolished and the surrounding sea cleaned up. The intention is that there will be a ceiling for how many tourists are allowed to visit the island. And the big beach parties that were previously held at Boracay are prohibited.
Most of the visitors came in 2018 from South Korea, China and the USA.
FACTS – TOURISM
Number of foreign visitors per year
6333 000 000 US dollars (2016)
The share of tourist income from exports
8.6 percent (2016)
Over a thousand dead in natural disaster
The typhoon washes over southern Philippines. More than 1,200 people are killed, most of them in the city of Cagayan de Oro in Mindanao, as the water breaks down the river banks. Entire villages are washed away after landslides. At the same time, the disaster shows again how poor the preparedness of the authorities is and how little has been done to remedy the problems. A new warning system with mobile phones is not activated because the storm force was below the limits set by the authorities.
High judges are prosecuted
The House of Representatives decides that Renato Corona, the Supreme Court’s chief judge, should be put before the state Senate for abusing the public’s trust by lifting the travel ban on Arroyo. Corona had been appointed by the last president in 2010 just a few weeks before she left power. He is also said to have failed to declare his financial assets and is accused of having too close ties to Arroyo.
Arroyo is being prosecuted and prevented from leaving the country
Former President Arroyo is prevented from leaving the country for medical care because of concerns that she will not return if charges are brought against her. This is despite the fact that the Supreme Court has given a clear sign for the trip abroad. Shortly thereafter, she is indicted for irregularities that must have been committed in the 2007 election. An arrest warrant for Arroyo was issued on November 18. She is being held in a military hospital.
New unrest at Mindanao
New fighting breaks out between MILF and the government army.
New talks between the government and Milf
Talks start talks between the government and the MILF guerrilla in Malaysia.