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Which Philippine President Caused the Downfall of the Philippine's Economy?
Galleries 6/1/2013 963 Comments

Ever since I could remember, my parents have always told me that President
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Ferdinand Marcos (FM) caused the downfall of the Filipino economy. I have
always believed them. However, lately, my children have been getting
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conflicting reports on just who is to blame for this fall. This is why I decided to do a little
research on this.
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The SME Forum (TV Show) So, did FM actually turn us into the “Sick Man of Asia”? I decided to take a look at three
prominent analytic indicators… the Philippine peso - US dollar exchange rate, the
gross domestic product (GDP) and the country's debt to GDP ratio. I particularly Boom San Agustin
is the Managing Director of
focused on the period from where President Marcos began his administration to
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President Benigno Aquino III's (P-Noy's) term (As of this writing, P-Noy is only in his 3rd
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year in office).
and Foreign Start-ups, SMEs
and Organizations based in
Here's what I found:
the Philippines.

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LEGEND:

Blue Line: PHP-USD Exchange Rate (USD to 1-PHP / 1000)

Green Line: Gross Domestic Product - GDP (in billions USD)
Red Line: Debt to GDP Ratio (percentage % of Debt / GDP)

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SOURCES:

Data Source for GDP: The World Bank via www.tradingeconomics.com

Data Source for Debt-GDP Ratio: The World Bank via www.tradingeconomics.com

Data Source for PHP-USD Exchange Rate History: www.fxtop.com

All sites claim that all data provided have been adjusted for inflation
This chart seems to indicate that my parents were right.

If you view the chart, you'll notice that between 1970 and 1972, long before Ferdinand
Marcos declared Martial Law; the Philippine peso plummeted by a staggering 40% (and
a total of more than 80% before he was ousted in 1986). Also, during his term in office
we hit our highest Debt-GDP Ratio of more than 90% (which is extremely bad). Though
our GDP did improve during his term, it was too little an improvement to cover for our
massive debts and a falling peso.

So, did President Marcos cause our downfall? I’ll let you be the judge of that.

However, this chart did make me realize a few things. Mind you, the following is only my
opinion...

I think I owe President Gloria Macapagal-Aroyo (PGMA) an apology. I openly accused

her of bringing our economy down; but, after looking at the World Bank data, I may have
been wrong.

During PGMA's term, our GDP rose to around 170 Billion USD from a mere 71 Billion
USD when she took over. She also managed to bring down our Debt-GDP Ratio to 44%
from a high 63% when she first held office. She even managed to improve our exchange
rate a little bit. It might be a stretch, but I believe that the economic windfall we are
enjoying today may have started during PGMA's time. P-Noy may be riding a wave
created by PGMA.

Yes, we’ve had a windfall since PGMA's time in office; yet, somehow, it just doesn’t
seem to be enough. P-Noy can’t afford to rest on his laurels right now. He’s got a great
big mountain to climb. I, for one, would like him to reach the zenith. Because, if he does,
we all benefit.

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963 Comments

Hans 6/1/2013 06:42:08 pm

Very nice graph and research. It shows you a good history. Very easy to
understand what happen to Philippine.

Reply

Boom 6/1/2013 07:15:09 pm

Hi Hans! Thanks for your comment. It was actually easy to get this data.
All I had to do was input the beginning and end years on FxTop and
(viola) instant table. :)

Reply

leo 2/27/2014 09:05:02 pm

Hindi rin kumpleto yung paganalisa using those graph,,,,, hindi

isinama yung ibang factor that could also lead to the down fall of
our economy especially during Marcos regime,,,,nakalimutan
yung Korean war, Vietnam War at cold war dahil sa panahong ito
sumipa ang value ng dollar,,,,after that US control the monetary
exchange in Oil dahil dollar ang pwedeng gamitin lang sa pambili

ng Oil at lalong nag shoot-up yung value ng dollar!

palengkero 2/28/2014 11:59:37 am

have you also considered external factors such as the 1973 Oil
embargo, the communist and muslim insurgency?