MENESES, GENESIS A.

GEED 10043
BSA 1-3 THE CONTEMPORARY
WORLD

Global Inequality: World System Theory and Dependency Theory Evident in the
Contemporary Condition of Philippines

Look around you; look at your appliances and furniture. Look at your washing machine,
your electric fan, your phone, your television or even your shirt or whatever you're wearing right
now. Is it made in China, Germany, France or the United States? What was the brand? Was it
local or was the brand Japanese? Is your phone Samsung or Apple? Was the washing machine
by the brand of Hanabishi and the electric fan of Asahi? Was the TV Panasonic? The point of
this paragraph is that we are surrounded by brands that aren't even local to the Philippines, yet
we patronize them. It's not just the appliances and gadgets that we have, the chocolates in your
fridge, the book you're reading, the playlist in your phone, and the movies you're watching. It's
all imported.

The Philippines was a colonized country over the past hundred years. The Spanish, the
Americans, the Japanese had their fair share of time colonizing the Philippines; transforming
them, making the country of their own. As a result, they've left something for us. They've
engraved their traditions, their cultures, their architecture, their education, and even democracy
but the deadliest thing they have given us was the colonized mind. The thinking that imported
goods are always better than locals; that developed countries are better than agricultural ones,
blinding us from the truth that we're just as rich as those countries.

After the wars and colonizing have finished, engraving colonial minds within us, they
gave us Neocolonialism. It is a system where the past colonizer maintains the exploitative
relationship with former colonies; it is a continued relationship where the former colonizer has
active control over the newly independent state. It is where they develop by under-developing
countries through trade exploitation. The thought of Neocolonialism gave birth to what we call
"Global Inequality." It is a reality that makes the rich richer and the poor poorer. To further
explain global inequality, World System Theory and Dependency Theory will be used to
examine why global inequality persists in the Philippine Contemporary.

Dependency theory entails the concept where resources are flowing from the periphery
(underdeveloped state or country) to the core countries (wealthy state or country) enriching the
latter by exploiting the former. A study shows that nations are underdeveloped due to western
countries deliberately underdeveloped them. The World System theory, on the other hand, adds
another variable to the concept: semi-periphery. Semi-periphery is a condition where countries
are developing but not developed enough to be qualified as a core. Semi-periphery serves as
the bridge between the variables. Thus, the core utilizes resources from the semi-periphery
while the latter utilizes its resources from the periphery. The World System theory operates on
dependency theory but merely focuses on a broader spectrum where the division of labour
happens globally. Both theories state that the world isn't a binary battle between the wealthy
state and the underdeveloped state but of the world operating on the oppressiveness of
capitalism.

With the definitions of both theories, we can say that the Philippines is a periphery
country. In other words, we are in a third world country. While Taiwan, South Korea and Brazil
are semi-periphery countries and countries such as the United States and Japan are considered
core countries. To further explain how the World System theory operates in our country, the
Philippines and the United States will be used as an example. The Philippines is rich
agriculturally; naturally gifted with natural resources but underdeveloped while the United States
is a rich country going towards modernization. In this relationship, the Philippines exports raw
materials (electronic parts) to the United States, which in return, processed them into a product
(cellphones) because they have the capital which we don't. Suppose that we gave them the
electronic parts for 1,000Php, they processed them into cellphones and sell it to us for
10,000Php. In the labour context, since labour is also cheap in the periphery countries, the core
countries such as the United States exploited it by the rise of BPO (Business Process
Outsourcing). Unites States uses vendors in the Philippines as an offshore BPO where the
wage (the cost of labour) is cheaper than it is in the United States. So, instead of paying 7.25$
or 350Php per hour (minimum wage in the United States), they pay 1.38$ or 67Php per hour
(minimum wage in the Philippines).

Knowing the concept of Neocolonialism, it is absurd how fast it transitioned the

Philippines from the Rising Tiger of Asia to the Sick Man of Asia. It happened during the regime
of Marcos where the debts grew exponentially leaving us almost with a 24.4$ billion, which is a
large amount considering that it is the year 1973. The 1980s came, and the government could
no longer repay the debt they have incurred. It led to the freefall of the economy, GDP growth
dropped 5.3 per cent, prices of primary export commodities fell by 50 per cent, worker's wages
reduced, and unemployment hit one-fourth of the labour force. The country has no choice but to
squeeze public services and maintenance expenditures, reduce infrastructure investments, and
raised the tax. It led to the privatizing of social services of the Philippines. The government sold
its assets to private companies to repay its debt which in a way is a poor decision considering
that to provide social services to the Filipinos is one of the primary responsibilities of the
government; its primary interest is to suffice the basic needs such as electricity and water yet
the government sold the PLDT (Philippine Long Distance Telephone Company), NAPOCOR
(National Power Corporation) and MWSS (Manila Water and Sewerage Services). As the public
assets privatized, the debt also led to free-market reforms which are very evident in the
Philippines. It is where my example between the relationship of the Philippines and the United
States came from. Those who benefit from these free-market reforms are those multinational
corporations and businesses originating from the core countries. It gave them a passage to
enter freely to the underdeveloped country's cheaper market. Thus, resulting from an endless
circuit of exploitation relationship between the capitalist and the people.

Once again, the Philippines is under an enormous amount of debt as the pandemic and
natural catastrophes continue to tear down the economy. It's not that borrowing is coherently
bad for the country; it is just that funds that were borrowed by the government are nowhere to
be found by the citizens. Hospitals are lacking in facilities and equipment; wards are overbooked
and overcrowded, Balik Probinsya did more harm than good – in other words, the success the
government is projecting in the handling of the pandemic is a huge fallacy; millions were
corrupted. Thus, the citizens who have not benefited from the loan will be its debtors; we have
gained almost nothing, yet we will be the one paying for it – a classic move of thieves in a suit.
The government borrows to corrupt, which led to greater inequality, both outside and inside the
country. The Philippines became a capitalist prey over the years, and it's hard to once again
experience redemption. The debt that trapped us during the 1970s and 1980s is the same debt
that will trap us in the 2020s.

In conclusion, the colonialism left us a scar, an eternal loophole where countries such as
the Philippines may not escape. It is a constant relationship between the core countries and the
periphery countries, the capitalist and the people; a relationship where the rich become richer
and the poor become poorer. We live in a world of inequality.
References:
Aguinaldo, M., Cabalatungan, S., Lazaro, A., Nabong, G., Santero, G. M., & Tena, M. (n.d.).
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