This study evaluates the role of foreign investment in Philippine development in the last two decades by comparing the Philippine investment experience with that of Malaysia and Thailand. While it has become an article of faith that foreign investment is essential to successful economic development, we argue that political economy factors—via appropriate state interventions and the embedding of investment policy in broader visions of industrial development—have been decisive processes behind these countries’ relative success at securing salutary investments and maximizing their benefits for industrial upgrading.
Photo credits (L–R): NghiaNTC; CarinaChen; MichaelGaida • Source: www.pixabay.com.
Download abridged versions of papers presented at a policy forum, "Making Investments Work: Paradigms, Patterns, Prospects" which was held on 24 November 2016, Balay Kalinaw, University of the Philippines Diliman.
- Foreign Investment and Philippine Development: A Comparative Approach | A Policy Brief
- Foreign Investment, the Manufacturing Sector, and Poverty: The Philippine Case | A Policy Brief
- Rechanneling Investments from Private to Business to Nation-building | A Policy Brief
This policy brief focuses on the lack of transformation of the economy, drawing on comparisons between the Philippines and its Southeast Asian neighbors. It asks why economies like Malaysia and Thailand grew faster after 1980 while the Philippines failed to do so. Moreover, poverty reduction was much faster in these countries. The role of foreign direct investment (FDI) in development is highlighted.
Since 2012, the economy has become one of the fastest growing in the world. In the process, even if the economy remains to be a consuming economy, it has slightly become an investing one. However, investment expenditure may tend to be confined to private gains as opposed to first, business gains, and second, gains in nation-building.