For a long time, agriculture, fishing and
forestry were the backbone of the Philippines' economy,
but nowadays the service sector and manufacturing
industry mean more to the economy as a whole. There is
also an extensive informal sector of the economy, mainly
in the larger cities. Of significant importance to the
economy is the money that Filipinos send abroad to their
home country. In 2018, this amounted to about $ 34
billion, which was just under a tenth of GDP.
The financial sector has increased in importance
since the 1980s and tourism provides significant income.
New niches in the service sector have also grown
rapidly. It may be that foreign IT companies move
customer support and development to the Philippines or
the production of animated films, market surveys or
companies that support healthcare institutions (printing
journal entries and more). These industries, which are
concentrated in Manila, Cebu City, Cagayan de Oro and
Iloilo, employed about 1 million Filipinos in 2017 and
were estimated to bring in about $ 20 billion a year.
What has attracted companies to the Philippines is said
to be good access to university-educated workers who
also had good knowledge of American culture.
Major imports by Philippines, covering a full list of top products imported by the country and trade value for each product category.
Industrial goods (mainly electrical and electronic
equipment) account for most of the exports. The export
industry is dependent on the business cycle in Japan,
the US and China where a large part of the goods goes.
In the 1960s, the Philippines was one of the region's
richest countries, but as growth accelerated in
neighboring countries, the Philippine economy stagnated.
Only in the 1990s did the development turn. In 1996, GDP
rose by more than 7 percent, but the following year the
country was included in the Asian economic crisis.
Export successes for the telecom industry in 1999 and
2000 led to an economic recovery, but reduced demand for
IT goods in the US meant a new decline in 2001. However,
the Philippine economy managed the global financial
crisis of 2008 relatively well, thanks in large part to
the flow of money from Filipinos abroad. This has given
the Filipino households more money to move around and
private consumption has contributed to high growth
figures. In 2008–2017, growth averaged nearly 7 percent
per year. Inflation also seemed to pick up momentum from
Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including PHL which represents the country of Philippines.
Since the 1990s, the economy has been liberalized.
State monopolies have been abolished, currency
restrictions have been removed and a number of state
companies have been privatized. The revenues from the
sale of state-owned enterprises helped the state from
1992 to show a small surplus in the state budget. From
1998 it ended up again at minus.
However, the deficits decreased from the 2010s,
partly because they managed to keep spending down, but
also because the state got more in tax). New excise
taxes were introduced, for example, for alcohol and
tobacco. Greater efforts have also been made to access
taxpayers and reduce corruption in the public sector.
During Benigno Aquino's time in power, 2010 to 2016,
efforts were made to improve roads, ports, airports and
electricity grids, partly with the help of private
money. The shortcomings in infrastructure are an
important hindrance in developing the economy. Rodrigo
Duterte's government, which took office in 2016,
promised even greater investment in new infrastructure,
including a new subway system in Manila. Money for it,
according to the plans, will come via higher taxes on,
for example, coal, cars, gasoline and other oil
products, soft drinks and beauty operations.
Foreign investments have been relatively low, but
they have risen steadily since 2010. However, they are
only a fraction when compared with some other countries
within the partner organization Asean such as Singapore
and Indonesia. Most of the investments in 2017 came from
companies from the Asian countries, Japan, China and the
Foreign debt represents a heavy burden for the
country, although it has decreased somewhat in recent
years. At the same time, foreign investment has
increased, but it is nowhere near as large as in other
countries in the region.
Traditionally, the Philippines has a trade deficit,
ie imports are larger than exports.
In August 2015, the so-called referrals from
Filipinos working abroad for the first time declined
since 2003. According to some analysts, this could be a
sign that more Filipinos had found work at home. And
that the IT sector in the country would soon generate as
much revenue as the referrals. Thereafter, they
increased again, but the growth rate has leveled off,
largely because less money than before is sent home from
the countries of the Middle East. This is due to lower
oil prices, efforts in the Gulf states to reduce
dependence on foreign labor and a temporary halt for
guest workers in Kuwait in the spring of 2018 (see
FACTS - FINANCE
GDP per person
US $ 3 103 (2018)
US $ 330,910 million (2018)
6.2 percent (2018)
Agriculture's share of GDP
9.3 percent (2018)
Manufacturing industry's share of GDP
19.1 percent (2018)
The service sector's share of GDP
60.0 percent (2018)
2.5 percent (2019)
Government debt's share of GDP
38.9 percent (2018)
US $ 73,080 million (2017)
Assistance per person
US $ 2 (2017)
Peace talks ongoing between the government and the NPA
Representatives of the Communist movement and government meet in Hong Kong
and agree to begin formal peace talks in 2011. Both sides announce a ceasefire
over the Christmas holidays.
Court says no to truth commission
The Supreme Court ruled that the decision to form a Truth Commission to
investigate corruption allegations against former President Gloria Macapagal
Arroyo is contrary to the Constitution.
Human Rights Watch criticizes Aquino
The human rights organization Human Rights Watch criticizes President Aquino
because he has not taken any measures to police and military to be tried for
human rights violations.
The United States promises new support
President Aquino visits the United States and promises US support for nearly
$ 3 billion.
Hostage frame in Manila
A retired police officer hijacks a bus in Manila and takes about twenty Hong
Kong tourists hostage. Police intervene but eight hostages are killed.
Benigno "Noynoy" Aquino III wins the presidential election
Benigno "Noynoy" Aquino III wins the presidential election on May 10 with
just over 42 percent of the vote, against 26 percent of former President Joseph
Estrada. Estrada's pair horse Jejomar Binay wins by a marginal margin in the
vice presidential election. The turnout is just over 75 percent.
Nearly 200 people are being prosecuted for the Maguindanao massacre
196 people are indicted for involvement in the Maguindanao massacre (see
November 2009 and Political system). In June, a witness was shot dead.