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The Economy of the Philippines Per Capita Income: The per capita income of a
certain country is the GDP of that country divided by the total population. In
the Philippines the per capita income is approximately $700. When compared to
the per capita income of the United States, which is about $22,000, it is easy
to tell that the economy of the Philippines is very, very poor. GDP: Growth:
5.7% GDP= 82.8 billion dollars % FROM AGRICULTURE: 17.1 (important because you
would think that since they mainly produce agricultural products that its
percentage would be the highest) % FROM MANUFACTURING: 18.9 % FROM SERVICES:
39.2 (also important because you wouldn’t think that this one would be the
highest) % FROM GOVERNMENT: 7.9 Exports: Traditionally, the Philippines have
been primarily an exporter of raw materials and an importer of manufactured
goods. This is the role that many “third world” countries play in the global
economy.
Electronic and automotive parts, along with garments are the leading
merchandise exports of the country. However, the Philippines also rely heavily
on import inputs. The country also exports bananas, coconuts, copper, gold,
lumber, pineapples and sugar. Imports: The Philippines mostly imports
manufactured goods. Certain items remain subject to import regulations such as
narcotic drugs, firearms, ammunition, etc. Their chief imports include
chemicals, machinery, and petroleum. Trading Partners:
The Philippines, like any
other country, cannot produce everything that it needs. Instead, it relies
heavily on foreign trade. Specialization in production allows for each nation to
produce what it produces best, and to trade for products, which it cannot
produce as well. This means that if you are better at one thing and I am better
at another, rather than each of us trying to do both, we would each do what we
are best at. Then, we would exchange what we had produced and both be better off
than had we tried making both things on our own. It trades mainly with Japan and
the United States. The Philippines maintain high tariff rates and protective
barriers on sensitive agricultural products. Major Economic Activities:
The
Philippines has embarked on economic reforms and market liberalization measures
in the past two years. As a result of this the Philippines has started to show
signs of recovery since the era of Ferdinand Marcos. Even though the
unemployment rate is very high, it has dropped from 10.5% to 9.8%, a
considerable move for a two-year period. In the Philippines, the minimum age for
employment is 15. Their constitution prohibits forced labor. All workers have
the right to join unions. The prices are generally determined by free market
forces, with only a few exceptions. Conclusion: Although the Philippines economy
is weak, and the unemployment rate is high, the Philippines are showing some
signs of improvement. It has recently become a more open economy, allowing for
more free trade and free market forces. As this process continues, trade with
the Philippines will increase, and eventually, a more capitalistic and a
successful economy will emerge.
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