Pathways to Sustainable Growth
Edited by Anis Chowdhury and Iyanatul Islam
Chapter 8: The East Asian crisis: the Philippines experience
8. The East Asian crisis: the Philippines experience Joseph Y. Lim1 INTRODUCTION Among the victims of the East Asian crisis, the Philippines was the only one not earlier touted as an East Asian ‘tiger’ or newly industrialized country (NIC). The signiﬁcance of the crisis for the Philippines and its impact on it are therefore qualitatively diﬀerent from that on the other countries. Unlike its East Asian neighbours, the Philippines followed a boom–bust cycle in its recent history of economic development (see growth rate ﬁgures in Appendix, which presents selected macro indicators of the hard-hit countries of the Asian crisis). Not only did the Philippines lag behind its ‘tiger’ neighbours in terms of economic growth, it also failed to penetrate export markets, achieve technological advancement, eradicate poverty and promote overall social and human development (see Lim, 1998b; Agosin and Ffrench-Davis, 1998). The Philippines’ failure to replicate the earlier successes of the so-called East Asian ‘tigers’ is thus crucial in studying the impact of the East Asian crisis on it. Its domestic savings rate was low compared with those of its East Asian neighbours (see Appendix). It suﬀered growing trade and current account deﬁcits during periods of growth and boom. On the other hand, the growth of the other East Asian countries in the second half of the 1980s – when their ‘tiger’ or NIC reputation was at its height – was accompanied more or less by high export growth and manageable trade and current account deﬁcits. This...
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