Could The Philippines Predict Our Next Decade?
Summary
TLDRThe video script explores the Philippines' unique economic journey, highlighting its rapid growth amidst challenges. Despite being resource-rich but economically lagging, the country leverages its people and strategic location for business and outsourcing, aiming to rival advanced Asian economies. However, it faces internal corruption, political instability, and external pressures from US-China relations. The script also examines the potential impact of technological advancements on its industries and the need to upscale to avoid obsolescence.
Takeaways
- 🌏 The Philippines is an overlooked country with one of the fastest-growing economies, achieving growth differently from regional peers like Thailand, Vietnam, and China.
- 🏞️ Despite having significant natural resources, the country's wealth comes from leveraging its people as well as its resources, setting it on a path to become an advanced Asian economy.
- 📈 The Philippines' economic growth is driven by its strategic positioning in Southeast Asia, becoming a hub for business and operations as China's become more complex.
- 🔄 The country faces numerous challenges including geopolitical tensions, corruption, political instability, and extreme inequality, which could hinder its progress.
- 🇺🇸 The Philippines has a complex relationship with the USA, which has historically influenced its economy and infrastructure, but also complicates its geopolitical stance.
- 💼 Major global companies like Accenture choose the Philippines for outsourcing due to its English-speaking, Western-educated workforce and strong regulatory practices.
- 🚧 The country's island geography presents both advantages and challenges, influencing its focus on white-collar services over manufacturing and contributing to a large trade deficit.
- 🛠️ The Philippines has a promising shipbuilding industry, focusing on smaller vessels that align with its domestic needs and global market demands.
- 🔊 Corruption is deeply entrenched in the Philippines, impacting economic growth and deterring both domestic and foreign investment.
- 🌐 The country's tech sector focuses on mid-tier operations, providing basic components for a wide range of products, capitalizing on its position in the global market.
- 🏙️ Inequality in the Philippines is stark, with a concentration of wealth and development in Manila, while remote areas lag behind, affecting social mobility and talent distribution.
Q & A
What makes the Philippines an interesting country despite its economic challenges?
-The Philippines is interesting due to its rapid economic growth, unique geographical, political, and cultural factors, and its potential to become one of Asia's most advanced economies by leveraging its people and natural resources.
How does the Philippines differ from other major economies in the region in terms of economic growth?
-The Philippines is growing rapidly but differently from other major economies like Thailand, Vietnam, and China, focusing on leveraging its human resources along with its natural resources, rather than just exploiting the latter.
What are some of the challenges the Philippines faces in its path to prosperity?
-Challenges include internal issues like corruption, an uncertain political landscape, and severe inequality, as well as external pressures such as its role as a middleman between the USA and China and the potential irrelevance of its industries due to technological advancements.
How has the Philippines' relationship with the USA influenced its economy and infrastructure?
-The USA's colonial history and ongoing military and economic support have significantly influenced the Philippines' infrastructure, with investments in hospitals, roads, and bridges, and have made English the dominant language in governance and business.
What is the significance of the Treaty of Manila in the context of the Philippines-US relationship?
-The Treaty of Manila, signed on July 4th, 1946, marked the Philippines' independence from the USA, yet the two countries' political and economic interests remain intertwined, affecting each other's geopolitical and economic situations.
Why has Accenture, a global professional services company, targeted the Philippines for its operations?
-Accenture has targeted the Philippines due to its unique geographical and political position, cultural history, and the high-quality, low-cost workforce that can connect with Western clients effectively and offer dependable services.
What advantages does the Philippines have over other Asian countries in terms of outsourcing?
-The Philippines offers advantages such as a Western-educated workforce, high standards and regulatory practices, and cultural familiarity that make it a preferable destination for outsourcing over other Asian countries with potential security and IP theft concerns.
How does the Philippines' geography impact its industrial capabilities and economic strategy?
-Being a series of islands with limited land mass restricts the Philippines' industrial capabilities, particularly in manufacturing and transportation. However, this has led the country to focus on white-collar services and industries like shipbuilding and technology sectors that align with its geography.
What is the current state of the Philippines' trade balance, and what are its implications for the economy?
-The Philippines imports significantly more than it exports, resulting in a trade deficit of around 57 billion dollars annually. This highlights the need for the country to find more reliable ways to close the trade gap and stabilize its economy.
How does corruption in the Philippines affect its economic growth and the willingness of investors?
-Corruption in the Philippines is deeply entrenched and affects economic growth by deterring domestic and foreign investment, misusing public spending, and creating an environment of uncertainty that is unattractive to investors.
What is the potential impact of AI on the Philippines' outsourcing industry, and how could it affect the country's economic stability?
-AI is predicted to significantly impact sectors such as back-office work, customer service, call centers, and logistics management—key areas of the Philippines' outsourcing industry. This could threaten economic stability if the country does not upscale its industries and adapt to technological advancements.
How does the Philippines rank in terms of GDP and GDP per capita, and what does this indicate about its economic status?
-The Philippines has a GDP of 471 billion dollars, ranking it as the 32nd largest economy globally. However, with a GDP per capita of just 4130 dollars, it indicates a large population with a relatively low average income, suggesting economic challenges despite overall growth.
What are the implications of the Philippines' inequality and how does it affect social mobility and the labor market?
-Inequality in the Philippines is inherent in its geography and exacerbated by governance issues. This leads to a lack of opportunities for talented workers in impoverished areas, limited social mobility, and a brain drain as skilled individuals leave the country for better prospects.
Outlines
🌏 Economic Growth and Challenges of the Philippines
The Philippines is experiencing rapid economic growth, standing out in the Southeast Asian region with a unique approach compared to neighbors like Thailand and China. Despite a large population living in poverty with an output below the global average, the country is rich in natural resources. However, it faces significant challenges, including corruption, political instability, and inequality. The Philippines is leveraging its people and resources to become a business and manufacturing hub, especially as operations become more complex in China. Yet, it must navigate its position between the USA and China and address internal issues to sustain its progress.
🤝 The Philippines' Complex Relationship with the USA
The Philippines' relationship with the USA is deeply rooted in history, beginning with the US taking over from Spanish rule in 1898. The US has significantly contributed to the Philippines' infrastructure and economy, but this has also created a dependency. The country's political and economic interests are closely linked with the USA, affecting its stance in territorial disputes and business relations with neighbors. The US military presence and investments indirectly aid the Philippines' economy, but also complicate its geopolitical identity. The relationship is further complicated by the Philippines' need to assert its sovereignty while benefiting from US support.
📈 The Outsourcing Boom and Economic Identity of the Philippines
The Philippines has become a major hub for outsourcing, particularly benefiting from its cultural history and Western influence, which allows its workforce to connect with Western clients effectively. Companies like Accenture have chosen the Philippines for its skilled, low-cost labor, and reliable regulatory practices. Despite competition from countries like China, Thailand, and India, the Philippines offers a unique advantage due to its English-speaking workforce and cultural compatibility with Western businesses. However, the country's reliance on outsourcing also makes it vulnerable to technological advancements that could disrupt these industries.
🛠️ The Philippines' Industrial Stagnation and Trade Gap
The Philippines' unique geography as a series of islands presents both advantages and challenges for its economy. While it has capitalized on white-collar services due to limited land for manufacturing, its trade deficit remains a significant issue. Shipbuilding and technology sectors focus on smaller, less competitive markets, providing a stable yet unspectacular growth. Corruption, political instability, and a lack of industry diversification pose risks to the country's economic stability. The potential for investment from President Ferdinand Marcos Jr offers hope for improvement, but also raises concerns about exacerbating existing inequality.
🏙️ Urban Sprawl and Socioeconomic Disparities in the Philippines
The Philippines faces significant urban challenges, with Manila's rapid expansion leading to poor living conditions and a lack of basic amenities. This, coupled with socioeconomic disparities, drives talented workers away and contributes to a brain drain. The country's economic growth is at risk of being undermined by the inability to provide adequate living standards and opportunities for social mobility, especially as technological advancements threaten the outsourcing sector, which is a key part of the economy.
📊 The Philippines on the Economics Explained Leaderboard
In terms of economic ranking, the Philippines holds the 32nd position globally with a GDP of $471 billion. However, its GDP per capita is significantly lower than the global average, reflecting the large population's uneven distribution of wealth. While the country has shown strong growth, its stability and confidence are hindered by corruption and political issues. The Philippines' industry is characterized by a middle-of-the-road approach, with no world-leading sectors but a robust presence in several mid-tier industries. The potential impact of AI and a reliance on foreign transfers pose challenges to its economic future.
Mindmap
Keywords
💡Economic Growth
💡Natural Resources
💡Outsourcing
💡Inequality
💡Geopolitical Interests
💡Infrastructure
💡Cultural Heritage
💡Manufacturing
💡Brain Drain
💡Corruption
💡Technology Sector
Highlights
The Philippines is experiencing one of the fastest growing economies in history, with unique factors setting it apart from regional peers.
Despite having a large population and significant natural resources, the Philippines faces challenges due to its overall low economic output and inequality.
The country's geography, political history, and culture contribute to its rapid economic catch-up, potentially positioning it alongside advanced Asian economies.
Leveraging its people is key to the Philippines' economic strategy, complementing its natural resources.
The Philippines serves as a stable business hub in a divided Southeast Asian region, taking on operations too complex for China.
Internal and external challenges, including its geopolitical role between the USA and China, corruption, and political uncertainty, threaten the Philippines' progress.
Technological advancements pose a risk to the Philippines' most promising industries, potentially rendering them obsolete.
The unique relationship between the Philippines and the USA, rooted in colonial history, influences the country's economic and political landscape.
US investments in infrastructure and the adoption of American values have shaped the Philippines' development.
The Philippines' sovereignty is tested by its reliance on the USA for economic stimulation and geopolitical protection.
Accenture, a major global employer, has targeted the Philippines for its outsourcing industry due to cultural and historical ties with the West.
Filipino workers offer a unique advantage in Western-oriented fields such as back office work and call centers, setting the country apart from competitors.
The Philippines' Western education system and regulatory practices make it a reliable partner for outsourcing, despite security concerns in other countries.
Geographical constraints limit the Philippines' industrial capacity but also focus its economy on white-collar services.
The country's trade deficit and reliance on imports present economic challenges that require innovative solutions.
Shipbuilding and technology sectors, focusing on mid-tier operations, have been significant drivers of the Philippines' economic growth.
Corruption is deeply entrenched in the Philippines, impacting economic growth and investor confidence.
Political instability and the risk of corruption deter both domestic and foreign investment, hindering the country's economic advancement.
President Ferdinand Marcos Jr's plans for a $100 billion investment could transform the Philippines into a manufacturing and logistic hub.
Inequality in the Philippines is both a geographical and governance issue, affecting the distribution of wealth and opportunities.
The Philippines faces a race against time to advance economically before being made irrelevant by new technologies, particularly in its outsourcing sector.
The Philippines' economic performance is evaluated on the Economics Explained Leaderboard, reflecting its middle-of-the-road status.
Transcripts
The Philippines is one of the most interesting and overlooked countries in the world.
It's currently home to one of the fastest growing economies in history and it's achieving
this very differently from other major plays in the region like Thailand, Vietnam and of course
China. This collection of islands is home to 115 million people which currently make up an
overall very poor population with an output roughly a third of the global average, which is
especially disappointing considering that the country has some of the greatest natural resource
endowments in the region. But exploiting natural resources alone is not enough to make a country
rich and in many cases it can work against it which is why the Philippines is so interesting.
Some strange quirks of the nation's geography, political history and culture mean that the
country is catching up rapidly and it's doing it in a way that could make it one of the most
advanced economies in Asia right in line with Taiwan, South Korea and Japan. It's doing this by
leveraging its people as much as the resources it can dig out of the dirt. As the Southeast Asian
region becomes more divided the Philippines is becoming a stable and friendly enough country to
do a lot of business, make a lot of products and accommodate a lot of operations that are
becoming too complicated to do in China. Of course that doesn't mean that the country has a clear
path to prosperity. It has a very long list of challenges both internal and external not least
of which is the fact that it's both physically and metaphorically acting as a middleman between
the USA and China. Beyond that ongoing issues like corruption and uncertain political landscape and one
of the most crushing forms of inequality a country can have are all immediate challenges that will
need to be addressed. It's a lot and that's before considering that the country's most
promising industry may be rendered completely irrelevant by technological developments happening
right now. So what has fueled the Philippines' intense economic growth? Are these industries
truly going to be sustainable in the coming decades? And finally what are the challenges that could
undo that progress? Once we have done all that we can put the Philippines on the economics
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time on all your writing today. To say the Philippines has a unique relationship with the
USA would be quite the understatement. As much as the US stimulates the Philippines economy and has
provided vital infrastructure, this dependency also opens the East Asian islands up to numerous
complications. It started with its colonial history when the USA took over from Spanish rule in 1898.
Uprising throughout the Philippines against Spanish rules became embroiled in the European
country's war with the USA and the end result was the Spaniards releasing the colonies to them
in exchange for $20 million at not completely insignificant sum at the time. Despite cries to
Filipino independence and resisting guerrilla fighters, the US ultimately voted in favour of
using the archipelago as a foothold into Asian trade. That wasn't the explicit reason given at the
time but let's be honest it's clearly a driving factor. However to be a competitive trading hub
it required significant investments into infrastructure. This was the turn of the 20th
century when economic prosperity more than ever was been determined by mechanisation and modern
infrastructure to support industries beyond just agriculture. Sponsorship from the US military
began installing hospitals, renovating roads and funding bridges. One city to see a big overhaul
was the capital of Manila. As the first few decades of the 20th century passed America moulded the
Philippines into its image. English became the dominant language especially in governance and
business and the education system was overhauled to instill American values even if it potentially
came at the cost of its own cultural heritage. Now of course the USA wasn't doing this out of the
kindness of their heart. Even back then they saw the strategic importance of these islands which
made them a worthy investment even if they couldn't claim them forever. After World War II the US and
the Philippines signed the Treaty of Manila on July 4th 1946 whereby the Philippines became an
independent republic. Sharing its day of independence with its former ruler perhaps ironically sums up
how dependent the Philippines actually is on US support. Even to this day the Philippines'
political and economic interests are intertwined with the USA whether they really like it or not.
There is the hotly contested territorial dispute with China over the dominion of the
South China Sea and Japanese business investments have forged a strategic partnership with the
Philippine government. This naturally means that any tensions between the Philippines and its
neighbors or business partners are felt by the USA and vice versa. If the US has economic disputes
with China like trade routes in the South China Sea for example then it will also play out in
Philippine markets and boardrooms. If Japanese investors try to broker a new deal with the
archipelago then the US will be on hand to intervene at the behest of their former colonies
interests or their own. Yet the Philippines is a sovereign state so it's expected to incur its own
hardships with its own economy. This places the country in a precarious situation where on one hand
they rely on the US both to stimulate its economy and protect its geopolitical interests while also
showing that it's not an American lapdog. That's a tricky identity to navigate when the US personnel
stationed in military bases contribute significantly to local business and commerce. Currently just
500 US military personnel are based in the Philippines but there are more bases due to be
built in the new future and the US pays handsomely for this foothold. Once the cost for salaries and
benefits of Americans stationed overseas are factored in then this practically becomes a form
of indirect foreign aid because the US is indirectly sending money to the Philippines through their
troops. Clearly the Philippines has a complicated relationship with the United States of America
at all levels of its economy. The big question is whether this entanglement is a gift or a curse
especially when the Philippines is used as a major hub for outsourcing including by one of the world's
biggest employers that most people have never heard of. It's called Accenture and it's a
self-described US multinational headquartered in Dublin for reasons obviously not tax related.
According to Fortune magazine its revenues in 2023 were an impressive 64.1 billion dollars and
that's thanks to having 91 of the Fortune Global 100 companies amongst its client base. The company
has 733,000 employees with officers and operations in more than 200 cities across 49 countries where
it serves clients in more than 120 economies around the world. A big part of the company's
operations are simple professional services provided by low-cost employees from countries
where labor is much cheaper than the advanced economies it works for. Accenture has targeted
the Philippines because of the nation's unique physical and political position but above all
else its cultural history. For starters Filipino workers are far more than just low-cost laborers.
There are knowledge based fields on offer like back office work, call centers and even creative
fields like basic marketing and design. Such diverse opportunities help businesses find the
most optimal cost-saving structure so even if they're not manufacturers looking to fill
overseas factories with cheap assembly workers there's a lot of heavy lifting that can be done
for them at a far lower cost in the Philippines. The likes of Amazon American Express, Apple,
Google and even Wells Fargo firmly integrate the Philippines into their business structure.
That means tens of billions of dollars have been generated thanks to the low-cost workforce of this
country but the question is why? There are plenty of other more competitive countries within a
stone's throw like China, Thailand and even India which has more English speakers than the
Philippines has people yet major global companies still choose here. The answer is simple but
unintuitive. Decades of Western education, cultural influence and work training means
Filipinas can connect with Western clients in ways other Asian workers might not be able to.
The high standards and regulatory practices also make them far more dependable meanwhile
the lower costs of labor outcompetes the workers from Western countries with similar features
plus there are the security concerns. Western companies are more inclined to hand over sensitive
documents to a censure or any other firm operating within the area than with their Chinese counterparts.
Even India, another outsourcing hub has had enough scandals and leaks within recent years
to lose credibility in the eyes of potential business partners. In 2019 the telecommunications
company T-Mobile sued Chinese manufacturer Huawei for stealing its technology through an
Indian subcontractor. According to the US Department of Justice report Huawei offered bonuses to workers
to steal confidential information for companies around the world and was even indicted for wire
fraud and obstruction of justice. That same year also saw Wipro one of the largest IT companies
in all of India fall victim to a devastating data breach. Allegedly a nation state actor accessed
their systems months before they realized their service had been compromised and it's not just
private businesses having issues like these. States and public bodies are regretting outsourcing
their tactile or funded projects. The state of Nebraska sued Wipro for failing to deliver on
a $6 million upgrade to a healthcare network and the US national grid came after Wipro for their
botched SAP upgrade. Apparently, the cost to undo the damage Wipro caused was more than the cost
of what they would have saved in the first place. In the end the Indian firm was sued for $75 million.
Concerns over lax regulatory practices and questionable attitudes to IP theft are partially
why the United States has blacklisted major companies from both India and China for this
kind of tech outsourcing. For any economy relying on their outsourcing industry to stabilize its
GDP that's a death blow. While these bands may have also had geopolitical motivations
they are a fantastic opportunity for an economy like the Philippines which doesn't need to be
perfect it just needs to be the least bad option. Western customs and strong regulatory practices
aside there is one more unique reason why the Philippines is so sought after. Its unique geography
plays a huge part in its outsourcing success. Unfortunately this factor also contributes
to its industrial stagnation. Being a series of islands with a small land mass means the Philippines
is immediately restricted with the services it can offer. Infrastructure connecting the islands
is limited or in some places it's just non-existent. Physically developing areas and industries
becomes a real and consistent challenge. Lack of usable land also means manufacturing and
transportation were never going to be the country's forte. On the plus side an immediate benefit from
this is not having to directly compete with China's manufacturing based economy. This naturally
inclines the Philippines into more white collar services where available land can be dedicated
to building offices and studios rather than plants or processing materials and harvesting
resources. Having a niche to carve out can be a good problem to have but everything in economics
is a trade-off. The Philippines imports more than exports to the tune of around a 57 billion
dollar deficit a year. That is a huge trade gap to fill for an economy of this size. Even if it
had a more robust manufacturing sector it would need to source revenue elsewhere. Sure some money
comes from services to overseas clients and there are remittances that's when Philippine
nationals working abroad send money back home but these steady streams aren't going to be enough
to stabilize the economy. There needs to be another more reliable way to close the trade gap.
Shipbuilding has been a promising growth industry. The country doesn't have the industrial capacity
to compete with the mega shipyards of Japan China and South Korea but instead of making a few
mega ships it has built a more reliable industry producing smaller less impressive vessels.
Due to its geography fleets of smaller cargo ships and ferries are already operating across
the archipelago so the country has a long history of dealing with these more basic vessels. For every
20,000 TEU cargo ship demanded by the world's largest shipping companies there are thousands of
ferries and basic faders crossing the world's oceans. This strategy of doing basic things and
doing a lot of it has really been the driver of the growth the Philippines has experienced over
the last two decades. It might sound mean to call an economy aggressively mid but that's really
been its strength. Basic services and basic shipbuilding are just the start too. Take their
technology sector. It focuses on small valuable components like basic microchip production.
Sure it's not as lucrative as the high end processor market and the Philippines tech sector
is certainly overshadowed by Taiwan but that's assuming that the Philippines needs to operate
in the same business at all. In reality basic microchips are in high demand. For every iPhone
or gaming rig a person needs there'll be dozens of other items in their homes running simpler
hardware with simpler chips and components. The trade-off here is that though the upper
levels of these billion dollar industries are out of reach the Philippines excels at mid-tier
operations. Put their basic microchips, basic shipbuilding, basic consulting and basic electronics
together and you've got a pretty formidable hold on middle of the road enterprises. The profits
may be low but so are the costs. Taking the middle of the road will only work up to a point though.
The world's leading advanced economies don't get there by harboring basic industries.
It can be a springboard but if the Philippines wants to break into the global middle class
it's going to have to upscale at least some of these industries. Now that is certainly possible
as we've already explored it has a talented workforce and good global connections but other
forces are at play that could threaten economic stability more than a competitive market.
Corruption in the Philippines is an open secret. It's so deeply entrenched across many levels of
government and business that it stunts economic growth from the get-go. Everything from the
misuse of public spending to good old-fashioned kickbacks and bribes. Domestic industries and
local businesses are less likely to receive funding from the country's government which already has
a history of eroding public trust. In 2021 a prominent anti-corruption journalist was shot
outside his home in what was a clear message to those wishing to hold their government to account.
Despite having a prolific radio show outing bent officials the alleged real mastermind behind
the assassination has not been charged. Instead the self-confessed gunman who many believe was
a foreguy has been sentenced to just 16 years. This is a pretty lenient sentence given the
Philippines' tough justice system. Possession of drugs in the Philippines frequently gets life
imprisonment or the death penalty by comparison. In 2023 the corruption perception index ranked
the Philippines 115th out of 180 countries. Even without the risk of holding corrupt governments
to account navigating red tape is enough to deter most Filipinos from setting up their own
enterprises. Outsiders are just as cautious preferring to do things at an arms length which
means it won't have the people willing to take the risks necessary to advance its industries
given the inherent sovereign risks that already come with the country. Uncertainty is an investor
repellent. The Philippines may offer a young workforce and an industry specialism with a
strategic location but the chance of political instability caps any confidence an outside investor
may have. However that is assuming that they are motivated purely by economic returns.
The Philippines president Ferdinand Marcos Jr, yep the junior of that Ferdinand Marcos who was
run out of his own country and said deep in ties with the USA and Japan would see a $100 billion
investment. This could be enough of a cash injection to improve their reputation. He has
claimed he wants to transform his country into a manufacturing and logistic hub. Such an ambitious
project could be what's needed to streamline business legislation and stamp out officials
driven by self-interest. To America the timing is perfect. Tensions in the South China Sea
demand fewer China and Taiwan centric supply chains. But to some nationals this potential
injection of capital will only exacerbate the already terrible inequality the country deals with
and they have a point. You can't stop politicians lining their own pockets by giving them more
money. Only a few islands are truly developed and that depends highly on how close they are to the
major islands that get a majority of the economic attention. Other times the province or a city
has a high GDP per capita because of tourism, agriculture and fisheries but the point is
inequality in the Philippines is inherent in its geography and exacerbated by questionable
governance. Manila for example is the most densely populated city in the world with a per capita
income more than 10 times higher than the remote islands. It's been rising at such a steady rate
that things are unlikely to even out in the future. Compare that to the living conditions of the
remote islands where a majority of people still live in absolute poverty. This disparity denies
talented workers from impoverished areas a real shot of making it in the outsourced labour market.
But muslim places like Manila are simply too expensive to uproot to. Ultimately the possibility
of upward social mobility is slimmer for anyone without a connection to the capital. Unfortunately
real living conditions are not much better for people in the big cities either. Some workers
can mitigate these costs by living outside Manila sure yet the vast urban sprawl has contributed
to terrible living conditions with basic amenities failing to keep up. Between 2000 and 2014 alone
14,059 hectares of built up area were haphazardly added to the city. Not only do these issues limit
the growth of a labour base it incentivises talented workers to leave. Most developing economies have
a brain drain problem but in the Philippines it's particularly acute because of the same
language and cultural skills that made the country so competitive in the first place.
This is all happening at a time where the country can least afford to lose its most talented because
it's in something of a race against the clock to become more advanced before it's made irrelevant
by new technology. Analysts predict the sectors to be most hit by AI will include things like back
office, customer service, call centres, warehouse, administration and logistics management. In other
words all the areas the Philippines specialises in as part of its outsourcing niche. Okay now it's
time to put the Philippines on the economics explained leaderboard. Starting as always with size
the Philippines has a GDP of 471 billion dollars making it the 32nd largest economy in the world
just behind Singapore and just ahead of Vietnam. Two other equally dynamic economies in the same
region that have achieved their economic scale in remarkably different ways. This gives the
Philippines a 7 out of 10. That very respectable GDP is however spread out over a large population of
115 million people which means the country has a GDP per capita of just 4130 dollars which despite
sustained growth over the previous years is still well below the global average of 13,000 dollars.
So the country gets a 3 out of 10. Stability and confidence is an interesting one. It has a level
of national security thanks to its unique relationship with the USA but that is quite
literally a double-edged sword which could open the country up to the complications we explored
in this video. Beyond that domestic issues like corruption and political tensions mean the country
can only get a 5 out of 10. Growth has clearly been very strong. The country has grown out a unique
set of local industries and capitalised on the talents of its large workforce. The country has
almost doubled its output over the last decade so it gets a 9 out of 10. Finally industry. The country
is not world leading at anything in particular but there is something to be said for being average
in a lot of average industries. Even still with a threat of AI, a reliance on foreign transfers
and very few local homegrown companies, the Philippines can only get a 6 out of 10.
Altogether that gives a country an average score of 6 out of 10, a healthy but middle of the road
score which has in many ways been the theme of this economy. Now last year we made a video on
Indonesia, an economy that on the surface looks very similar to the Philippines but is achieving
its record breaking growth in its own unique way. You should be able to click to that video on your
screen now. Thanks for watching mate. Bye.
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