UNIT 1

THE
PHILIPPINE
 Introduction:
An economy consists of the economic
system of the country or other area: the
labor, capital and land resources; and the
manufacturing , trade, distribution and
consumption of goods and services of the
area.
An economy may also be described as a
spatially limited and social network
where goods and services are exchanged
according to demand and supply between
participants by barter or a medium of
exchange with a credit or debit value
accepted within the network.
Government is a crucial institution in any
economy. It acts as a consumer as well as
a producer and taken as a whole it
becomes the largest single “business” in
nation. When asked about the
government, a lot of us would think of the
nation’s President and other Politicians.
However, we must consider the
government as a whole consisting of the
various offices, departments, and bureaus
rather than the individuals representing
said sectors.
The government is also called the public
sector, wherein decision making is
collective. The government’s role is to
replace individual’s decision with
collective decisions that make everybody
off.
MAJOR
SECTOR
OF
 MAJOR SECTOR OF
ECONOMY
Business Enterprises
Households
Government
 Business Enterprises

A legal entity, possessing the

right to conduct business on its
own
 Households

a group of people, often a

family, who live together.
 Government
a government is the system or
group of people governing an
organized community, generally
a state.
The strength or weakness of one
sector affects the other sectors
because of their interdependence.
However, it is the government which
provides the leadership in
improving the economy.
PHILIPPIN
E
ECONOMI
• 250,000 to 300,000 years ago, there were
already inhabittants in the Philippines.
• Over the long years, many other
countries in Asia groups settled in the
Philippines. They lived by hunting,
Fishing and food gathering.
• Later on, more civilized migrants
introduced primitive agriculture and
handicrafts. The barter system was also
practiced throughout the century.
• This time, the people were no longer
nomadic. They established permanent
settlements.
• Early in the 10th century, there was
already trade with the Arabs.
• 300 years later, the Chinese dominated the
trade from Batanes to Sulu.
• Foreign Trade created new communities in
bay areas and in places are the major
rivers like Sta. Ana.
COLON
• The Philippine became the slave of three
colonial masters: Spain, United States and
Japan.
• We were under the Spanish rule for more
than 3 centuries and about half century
under the American regime.
• The Chinese dominated the retail trade
business even during the Spanish time. They
clustered around Intramuros-which literally
means “city within the walls”-the Spanish
colonial capital.
• Tondo, Binondo and Santa Cruz were
inhabited by the Chinese and Parian was the
commercial center.
• The economic contributions of the
Spanish rule were the encomiendas,
galleon trade and tobacco monopoly.
• Under the American regime, the United
States set up free trade throuhg the
Payne-Aldrich Act in 1909.
• Likewise, Japan invaded the Philippines and
other Southeast Asian countries for economic
reasons. Japan could not penetrate the world
market due to trade barriers. It sold the idea
of Co-Prosperity Sphere to Southeast Asian
countries. This was an economic cooperation
against the United States and Europe.
• Because the Asian countries did not buy the
Japanese idea of economic cooperation. Japan used
military force to conquer Southeast Asian countries.
• Our economy was at its worst during the Japanese
time. Goods and services were extremely scarce;
inflation became very high, most Filipinos starved,
rice sacks were used as clothing and the price of rice
per cavan was from 30.00, it became 3,000.00