In 1954, the Philippines was second to Japan in economic development and industry. Why can we not be second to Japan now?

Given that the Philippines has all the mineral resources relative to industrial development, can it therefore produce high-value goods like cars and tractors, as Japan does?

No, not now. We have been left behind. Having mineral resources does not automatically enable our country to produce high-value manufactured goods like Japan.

Japan’s success is due to factors like their highly skilled workforce, technological advancement, and a developed industrial manufacturing base, while the Philippines’ mineral wealth is primarily extracted for export, and the country’s industrial economy is less developed for manufacturing.

The Philippines needs to develop strong, educated, and skilled workers, crucial for economic and industrial development. They drive innovation, increase productivity and enhance the country’s competitiveness.

A skilled workforce attracts foreign investment, leads to higher income and social mobility, and creates a more resilient and adaptable economy. Without that, the country misses out on demographic dividends and struggles to keep up with a rapidly evolving global marketplace.

The following constitute the factors for Japan’s success:

1) Japan has an advanced industrial base, and a mature industrial economy with a long history of manufacturing and technological development;

2) It has a highly educated and skilled workforce that is crucial for complex manufacturing;

3) Its manufacturing focuses on producing high-value exportable goods like cars, electronics, and machinery, not just raw materials;

4) While the Philippines is rich in minerals like nickel, gold, copper and chromite, the mining sector is a significant source of raw materials;

5) Although the Philippines is a major exporter of raw or minimally processed mineral ore, it has limited capacity to process them into finished goods domestically;

6) The Philippines still has an underdeveloped manufacturing sector. Its economy is not built around large-scale, high-tech manufacturing that would enable it to produce complex products like automobiles.

7) While the Philippines has natural resources, the mining industry’s contribution to its gross domestic product (GDP) is relatively small, and a smaller fraction of the population is employed.

In short, although the Philippines has the raw materials, it lacks industrial manufacture and technological development.

It took Japan almost 75 years after World War II to reach its status as the world’s fourth-largest economy and a top global manufacturer specializing in high-tech goods like automobiles, steel, and consumer electronics.

Its economy is a highly diversified services and industrial mix, although its manufacturing sector is a significant driver of its export-driven trade and global competitiveness in specialized components.

And speaking of Japan’s economic transformation and industrialization, back in 1954, or barely nine years after World War II, the Philippines was second to Japan in the whole of Asia.

If in 1954 we were second to Japan, why can we not be second to Japan now? It must be because of the pork barrel system, the deadly offspring of the “bicam,” the scourge of Philippine society.

Meanwhile, let us heed Department of Economy, Planning and Development Secretary Arsenio M. Balisacan’s policy statement titled: “Growing and Strengthening the Middle Class Towards Realizing the Ambisyon Natin 2040,” organized to underscore the need for comprehensive socio-economic strategies to support and expand the middle class.

Email: arturobesana2@mail.com