According to Stanley Fischer, First Deputy Managing Director of the IMF "among the potential victims of the [Asian] crisis, the Philippines economy performed exceptionally". (1) Considering the turmoil of the events of 1986 and the preceding years, this is an acknowledgement of the hard work and ensuing reforms that had been implemented by the renewed democracy's post-Marcos administrations. The dynamics of the period, beginning with the administration of Corazon Aquino, forms the basis of this article. Most government leaders around the world welcomed the Philippines' move away from an authoritarian president to a much-needed return to democracy.
However, as in most transitions, the recovery is often hampered by periods of difficulties, but the Philippines, aided by leaders (2) that are focused and determined to advance the country, is not about to ease up. In its macroeconomic assessment of the Philippines for 2002 the Asian Development Bank (ADB) stated that "despite the economic slowdown of 2001, and security issues in Mindanao [including the events of September 11] the country registered growth of 3.4 per cent in 2001". The ADB added that "reforms to improve both the investment environment and the operating environment for labour-intensive domestic and foreign businesses should be continued. Between 1985 and 1997, the incidence of poverty in the Philippines was reduced from 44.2 per cent to 31.8 per cent. There was some erosion in these gains during the following 3 years as a result of the Asian Financial Crisis". (3) This indicates the great progress made so far, yet further improvements are certainly needed for the country.
This article begins by first giving a summary of the leadership transitions that effectively returned democracy to the Philippines. These transitions in government provided the momentum to push the Philippines towards the 21st century with a renewed quest to re-engage itself into the global economic sphere. The transition from Marcos to Aquino as a result of sheer people power was made possible by the defection of the two most senior military officers at the time, Juan Ponce Enrile and Fidel Ramos. It also ended three years of uncertainty since the assassination of Begnino "Ninoy" Aquino. (4) The transfer of power from Aquino to Ramos demonstrates that the new government was right to take on the task of implementing the appropriate political and economic reforms. However, the Ramos government's efforts were dampened by the succeeding government, led by Joseph Estrada, who managed to take the Philippines a step back from its resurgence. This however has been turned around slightly with the appointment of Gloria Macapagal-Arroyo who took over the leadership when Estrada was impeached on corruption charges.
Second, the paper then goes into the heart of the Ramos era by explaining the extent of Ramos' contribution, as his government reengaged the Philippines on the world stage, not as a country under a dictatorship, but one with a renewed democratic spirit that had been hidden for years. Ramos used his government's term effectively for the development of the Philippines. Third, the paper further examines the Philippines' economic performance since the restoration of democracy and the role of reforms in this process. This section gives detailed data on the Philippines' economic performance by highlighting the stages and rates of growth, and the resurgence of foreign direct investment (FDI) as the processes of reform took shape. Fourth, the effects of the Asian Financial Crisis will be discussed, showing how the Philippines managed to avoid similar trends to that of its neighbours, who recorded negative GDP levels. Lastly, the paper briefly discusses the importance of stability and sustainable growth since the re-introduction of democracy.
21 August 1983 marks a very significant day in the Philippines' political history, as Begnino Aquino, Marcos' main political opponent, was gunned down at Manila International Airport. …