The earliest inhabitants of the Philippines were the Negritos. Other tribes later arrived from Malaysia and Indonesia. In 1521, the Portuguese navigator, Ferdinand Magellan, financed by the King of Spain, landed on the islands and named them after Philip II of Spain. Friars converted the inhabitants to Christianity and today the Philippines is the only predominantly Christian country in South-East Asia. Spanish explorer Miguel Lopez de Legaspi established the first Spanish settlement in Cebu in 1565; he moved north and defeated the Muslim Rajah Sulayman and established a Spanish base in Manila
in 1571, extending the area under Spanish control. In 1896, a revolution against Spanish rule led to the establishment of the first Filipino Republic in 1898, under General Emilio Aguinaldo. Later, the United States took control of the islands and a constitution was drawn up in 1935, giving the Philippines internal self-government.
The islands were occupied by the Japanese between 1942 and 1945, during World War II, only achieving independence in 1946. During the next two decades, there was a succession of presidents who maintained strong links with the United States. In 1965, Ferdinand Marcos of the Nacionalista party won the presidential elections and began a program of rapid economic development. Before his maximum of two terms in office were over, in 1972, Marcos instituted martial law and suppressed all political opposition. He also set about large-scale looting of the country’s exchequer to fill his and his family’s own foreign bank accounts. Opposition to Marcos evolved in two distinct forms: the ‘constitutional’ opposition, organized around dissenting senators such as Benigno Aquino; and the Communist Party, which, linking with various tribal groups, launched an armed insurgency based in the southern islands, particularly Mindanao.
By the mid-1980s, the New People’s Army (NPA), the armed wing of the Communist Party, was able to sustain a major insurrection right across the country in both rural and urban areas. The turning point for the regime came after the assassination of Benigno Aquino upon his return from exile in 1983. Public opinion rallied behind his widow, Corazon Aquino in a massive campaign of demonstrations and non-violent protest, popularly dubbed ‘People Power’. Then, US President Ronald Reagan withdrew his backing from Marcos. The Filipino military, Marcos’ last bastion of support, followed suit and Marcos left for Hawaiian exile in February 1986. He died there in September 1989.
Lacking any political experience, Corazon Aquino took a while to settle into the presidency. She was constantly threatened by the rump of Marcos supporters in the military who launched repeated but unsuccessful coup attempts, but earned the backing of most of the senior command by maintaining a hard line in the campaign against the NPA.
Military issues also dominated the Philippines’ key foreign relations with the USA. The Americans had maintained two large bases on Luzon Island at Subic Bay (navy) and Clark Air Base. By the end of 1994, both had been vacated: Clark Air Base was badly damaged by the volcanic eruption of Mount Pinatubo in 1991; Subic Bay was vacated by mutual agreement. By this time, the presidency had passed to Fidel Ramos, Aquino’s erstwhile Defence Minister. His term lasted until May 1998 when the Asian financial crisis, which hit the Philippines particularly hard, offered an opportunity to new political parties. Joseph Ejercito Estrada, leading the newly-formed
Laban ng Masang Pilipino (Struggle of the Filipino Masses, LMP), won the poll by a comfortable margin.
In January 2001 he was formally thrown out of office by the Supreme Court and replaced by his deputy, Gloria Arroyo – daughter of Diosdado Macapagal, the president during the early 1960s.
Arroyo has presided over a steady economic performance. She has also opened negotiations with the two main insurgencies: the NPA, while much diminished from its zenith, remains a potent force in some parts of the archipelago; while the Moro Islamic Liberation Front has grown to become the most potent of a handful of Islamic guerrilla groups. (Since the 11 September 2001 attacks in the USA, much attention has also been focused on the Abu Sayyaf group, which is believed to be affiliated with the
al-Qaeda terrorist network.). Arroyo was re-elected in May 2004.
GovernmentThe constitution adopted in 1987 provides for a dual-chamber congress comprising a 24-member Senate and a House of Representatives with a maximum 250 members, of whom 200 are directly elected. The president, who holds executive power, is elected for a six year term.
EconomyThe agricultural sector produces rice, corn, coconuts, copra, sugar cane and bananas as the main crops. Production of timber, formerly a major export earner, has been suspended due to the effects of deforestation. There is a moderately sized mining industry producing copper, gold, silver, nickel and coal. Offshore oil production is due to begin in the next few years.
Most of the Philippines’ recent economic development has been industrial, with food processing, oil refining, and the production of chemicals, electrical machinery, metal goods and textiles all having been established during the last 20 years.
Broad financial incentives aimed at attracting foreign investment capital, and the creation of five export processing zones (EPZ) with concessionary tax rates and tariffs, prompted strong growth during the early and mid 1990s. However, it also produced a somewhat skewed economy in which the Manila area, known as the National Capital Region, now hosts 15% of the population and accounts for one-third of GDP: there are huge income disparities between the capital and the rest of the country.
The Philippines’ economic growth came to a shuddering halt in late 1997 when the collapse of the region’s currencies produced a stock market crash, high inflation, the cessation of foreign investment, and a large budget deficit.
El Niño, the climatic system which wreaks periodic havoc upon the Philippines, worsened the situation further.
The economy has since recovered fairly well. In 2006, growth was 5.4% and inflation was reduced from 7.8% to 6.2%. Industrial production has picked up after several years of decline. In 2004, foreign investment quadrupled and local investment increased by 50%. Foreign aid (including a US$100 million subvention from the USA in 2002) has helped the country’s finances, along with a sharp increase in remittances from the thousands of Filipinos working abroad.
The Philippines’ longer term economic prospects will depend on the government’s vigour in pursuing essential and overdue reforms to the tax and banking systems, and improvements to the country’s shaky infrastructure.
The Philippines belong to the Association of South East Asian Nations and the Asian Development Bank.
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