Economic development is a term that generally refers to the sustained, concerted effort of policymakers and community to promote the

standard of living and economic health in a specific area. Such effort can involve multiple areas including development of human capital, critical infrastructure, regional competitiveness, environmental sustainability, social inclusion, health, safety, literacy, and other initiatives. Economic development differs from economic growth. Whereas economic development is a policy intervention endeavor with aims of economic and social well-being of people, economic growth is a phenomenon of market productivity and rise in GDP. Consequently, as economist Amartya Sen points out: economic growth is one aspect of the process of economic development. [1]

Contents
[hide]

1 Term 2 Social Science Research 3 Goals 4 Regional policy o 4.1 Organization o 4.2 International Economic Development Council 5 Community Competition 6 See also 7 References

[edit] Term
The scope of economic development includes the process and policies by which a nation improves the economic, political, and social well-being of its people.[2] The University of Iowa's Center for International Finance and Development states that: 'Economic development' is a term that economists, politicians, and others have used frequently in the 20th century. The concept, however, has been in existence in the West for centuries. Modernization, Westernization, and especially Industrialization are other terms people have used when discussing economic development. Although no one is sure when the concept originated, most people agree that development is closely bound up with the evolution of capitalism and the demise of feudalism.[3] Mansell and Wehn also state that economic development has been understood since the World War II to involve economic growth, namely the increases in per capita income, and attainment of a standard of living equivalent to that of industrialized countries.[4][5] Economy development can also be considered as a static theory that documents the state of economy at a certain time. According to Schumpeter (2003), the changes in this equilibrium state to document in economic theory can only be caused by intervening factors coming from the outside.[6]

[edit] Social Science Research

The study of economic development by social scientists encompasses theories of industrial/economic modernization causes, the historical phases or waves of economic development, and the organizational aspects of enterprise development in modern societies. Economic development embraces sociological research on a variety of topics including: business organization, enterprise development, evolution of markets and management, and cross-national comparisons of industrial organization patterns. One example inquiry would be: "Why are levels of direct foreign investment and labour productivity significantly higher in some countries than in others?"[7] In economics, the study of economic development was borne out of an extension to traditional economics that focused entirely on national product, or the aggregate output of goods and services. Economic development was concerned in the expansion of peoples entitlements and their corresponding capabilities, morbidity, nourishment, literacy, education, and other socioeconomic indicators. Borne out of the backdrop of Keynesian, advocating government intervention, and neoclassical economics, stressing reduced intervention, with rise of highgrowth countries (Singapore, South Korea, Hong Kong) and planned governments (Argentina, Chile, Sudan, Uganda), economic development, more generally development economics, emerged amidst these mid-20th century theoretical interpretations of how economies prosper.[1] Also, economist Albert O. Hirschman, a major contributor to development economics, asserted that economic development grew to concentrate on the poor regions of the world, primarily in Africa, Asia and Latin America yet on the outpouring of fundamental ideas and models.[8] ===Growth and Development Dependency theorists argue that poor countries have sometimes experienced economic growth with little or no economic development initiatives; for instance, in cases where they have functioned mainly as resource-providers to wealthy industrialized countries. There is an opposing argument, however, that growth causes development because some of the increase in income gets spent on human development such as education and health. According to Ranis et al. (2000), economic growth and human development is a two-way relationship. Moreover, the first chain consists of economic growth benefiting human development with GNP. Specifically, GNP increases human development by expenditure from families, government and organizations such as NGOs. With the rise in economic growth, families and individuals will likely increase expenditures with heightened incomes, which in turn leads to growth in human development. Further, with the increased consumption, health and education grow, also contributing to economic growth. [9] In addition to increasing private incomes, economic growth also generate additional resources that can be used to improve social services (such as healthcare, safe drinking water, etc.). By generating additional resources for social services, unequal income distribution will be mitigated as such social services are distributed equally across each community, thereby benefiting each individual. Thus, increasing living standards for the public.[10] Concisely, the relationship between human development and economic development can be explained in three ways. First, increase in average income leads to improvement in health and nutrition (known as Capability Expansion through Economic Growth). Second, it is believed that social outcomes can only be

improved by reducing income poverty (known as Capability Expansion through Poverty Reduction). Lastly, social outcomes can also be improved with essential services such as education, healthcare, and clean drinking water (known as Capability Expansion through Social Services).[11] John Joseph Puthenkalam's research aims at the process of economic growth theories that leads to economic development. After analyzing the existing capitalistic growth-development theoretical apparatus, he introduces the new model which integrate the variables of freedom, democracy and human rights into the existing models and argue that any future economic growth-development of any nation depends on this emerging model as we witness the third wave of unfolding demand for democracy in the Middle East. He develops the knowledge sector in growth theories with two new concepts of 'mirco knowledge' and 'macro knowledge'. Micro knowledge is what an individual learns from school or from varios existing knowledge and macro knowledge is the core philosophical thinking of a nation that all individuals inherently receive. How to combine both these knowledge would determine further growth that leads to economic development of developing nations. For further reading, please refer to "Integrating Freedom, Democracy and Human Rights into Theories of Economic Growth" & other publications(1998,2000&2010).

[edit] Goals
In the United States, Project Socrates outlined competitiveness as the driving factor for successful economic development in government and industry. By addressing technology directly, to meet customer needs, competitiveness was fostered in the surrounding environment and resulted in greater economic performance and sustained growth. [12] Economic development typically involves improvements in a variety of indicators such as literacy rates, life expectancy, and poverty rates. GDP does not take into account other aspects such as leisure time, environmental quality, freedom, or social justice; alternative measures of economic well-being have been proposed (more). Essentially, a country's economic development is related to its human development, which encompasses, among other things, health and education. These factors are, however, closely related to economic growth so that development and growth often go together.[13]

[edit] Regional policy

Diagram of key components of a strong regional cluster, U.S. Economic Development Administration [3] In its broadest sense, policies of economic development encompass three major areas:

Governments undertaking to meet broad economic objectives such as price stability, high employment, and sustainable growth. Such efforts include monetary and fiscal policies, regulation of financial institutions, trade, and tax policies. Programs that provide infrastructure and services such as highways, parks, affordable housing, crime prevention, and K12 education. Job creation and retention through specific efforts in business finance, marketing, neighborhood development, workforce development, small business development, business retention and expansion, technology transfer, and real estate development. This third category is a primary focus of economic development professionals.

One growing understanding in economic development is the promotion of regional clusters and a thriving metropolitan economy. In todays global landscape, location is vitally important and becomes a key in competitive advantage. The cluster of similar industries, specialties, skilled laborforce, and technologies help lower transaction costs and foster a growing environment of commerce, entrepreneurship, exports, and other market productive activities. Additionally, local services such as restaurants, stores, and trades experience growth as well, helping to develop a vibrant region for the wider community.[14] Even the U.S.s Economic Development Administration recognizes the importance of clusters with their continued Regional Innovation Clusters initiative which aims to create jobs and grow the economy through the geographic concentrations of industries and firms in their need for talent, technology, and infrastructure. [15]

[edit] Organization
Economic development has evolved into a professional industry of highly specialized practitioners. The practitioners have two key roles: one is to provide leadership in policymaking, and the other is to administer policy, programs, and projects. Economic development practitioners generally work in public offices on the state, regional, or municipal level, or in public-private partnerships organizations that may be partially funded by local, regional, state, or

federal tax money. These economic development organizations (EDO's) function as individual entities and in some cases as departments of local governments. Their role is to seek out new economic opportunities and retain their existing business wealth. There are numerous other organizations whose primary function is not economic development work in partnership with economic developers. They include the news media, foundations, utilities, schools, health care providers, faith-based organizations, and colleges, universities, and other education or research institutions.

[edit] International Economic Development Council

With more than 20,000 professional economic developers employed world wide in this highly specialized industry, the International Economic Development Council (IEDC) headquartered in Washington, D.C. is a non-profit organization dedicated to helping economic developers do their job more effectively and raising the profile of the profession. With over 4,500 members across the US and internationally, serving exclusively the economic development community, IEDC membership represents the entire range of the profession ranging from regional, state, local, rural, urban, and international economic development organizations, as well as chambers of commerce, technology development agencies, utility companies, educational institutions, consultants and redevelopment authorities. Many individual states also have associations comprising economic development professionals, who work closely with IEDC.[16]

[edit] Community Competition

One unintended consequence of economic development is the intense competition between communities, states, and nations for new economic development projects in today's globalized world. With the struggle to attract and retain business, competition is further intensified by the use of many variations of economic incentives to the potential business such as: tax incentives, investment capital, donated land, and many others. IEDC places significant attention on the various activities undertaken by economic development organizations to help them compete and sustain vibrant communities. Additionally, the use of community profiling tools and database templates to measure community assets versus other communities is also an important aspect of economic development. Job creation, economic output, and increase in taxable basis are the most common measurement tools. When considering measurement, too much emphasis has been placed on economic developers for "not creating jobs." However, the reality is that economic developers do not typically create jobs, but facilitate the process for existing businesses and start-ups to do so. Therefore, the economic developer must make sure that there are sufficient economic development programs in place to assist the businesses achieve their goals. Those types of programs are usually policy-created and can be local, regional, statewide and national in nature.

[edit] See also

Wikibooks has a book on the topic of Economic Development Wikimedia Commons has media related to: Economic development

Business cluster Constitutional economics Development economics Economic growth FORGE Program Infrastructure Metropolitan economy Private Sector Development Public capital

[edit] References
1. ^ a b Sen, A. (1983). Development: Which Way Now? Economic Journal, Vol. 93 Issue 372. Pp.745-762. 2. ^ O'Sullivan, A. and Sheffrin, S. M. (2003). Economics: Principles in action. Pearson Prentice Hall, Upper Saddle River, New Jersey. 471pgs. 3. ^ R. Conteras, "How the Concept of Development Got Started" University of Iowa Center for International Finance and Development E-Book [1] 4. ^ http://cbdd.wsu.edu/kewlcontent/cdoutput/TR501/page59.htm 5. ^ Mansell, R & and Wehn, U. 1998. Knowledge Societies: Information Technology for Sustainable Development. New York: Oxford University Press. 6. ^ Schumpeter, J. & Backhaus, U., 2003. The Theory of Economic Development. In Joseph Alois Schumpeter. pp. 61-116. Available at: http://dx.doi.org/10.1007/0-30648082-4_3 [Accessed October 19, 2009]. 7. ^ Lewis F. Abbott, Theories Of Industrial Modernization & Enterprise Development: A Review, ISR/Google Books, revised 2nd edition 2003, pages 12. ISBN 978-0-90632126-3.[2] 8. ^ Hirschman, A. O. (1981). The Rise and Decline of Development Economics. Essays in Trespassing: Economics to Politics to Beyond. Pp. 1-24 9. ^ Ranis, G., Stewart, F. & Ramirez, A., 2000. Economic Growth and Human Development. World Development, 28(2), 197-219. 10. ^ Anand, S. & Sen, A., 2000. Human Development and Economic Sustainability. World Development, 28(12), 2029-2049. 11. ^ Anand, S. & Ravallion, M., 1993. Human Development in Poor Countries: On the Role of Private Incomes and Public Services. The Journal of Economic Perspectives, 7(1), 133-150. 12. ^ Smith, Esther (1988-05-05). "DoD Unveils Competitive Tool: Project Socrates Offers Valuable Analysis". Washington Technology.

13. ^ Hanushek, Eric A., and Ludger Woessmann. 2008. "The role of cognitive skills in economic development." Journal of Economic Literature, 46, no. 3 (September): 607668. 14. ^ Porter, M. E. (1998). Clusters and the New Economics of Competition. Harvard Business Review. Pp. 77-90. 15. ^ http://www.eda.gov/AboutEDA/RIC/ 16. ^ http://www.iedconline.org

BusinessDictionary.com

economic development

Definition
Progress in an economy, or the qualitative measure of this. Economic development usually refers to the adoption of new technologies, transition from agriculture-based to industry-based economy, and general improvement in living standards.

Philippines Economic Development

By: EconomyWatch Date: 30 June 2010

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Philippines economic development has been very fast in recent years. However, in last three decades, growth rate has been fastest. Real gross domestic product for this time was estimated to be 7 percent, but growth has slowed down a bit in 2008, which came to about 4.5% because of world financial crisis. Economic development in Philippines economy has been because of high government spending. A hard working service sector and large allowance from millions of Filipinos working abroad played an important role in Philippines economic development. Since, Macapagal-Arroyo came into power in 2001 there has been an economic growth of 5 percent. Still, Philippines needs a further increase in growth rate in order to sustain growth in economy. More economic development of Philippines is required to alleviate poverty from that country and address imbalances in distribution of income. It also stresses on high population growth. Macapagal-Arroyo also has taken great care introduce new revenue measures to constrict expenditures of country. New developments in economy of Philippines can

be expected because of positive efforts in lowering fiscal deficits, narrowing debt and debt service ratios. There has been an increase in expenditure in infrastructure of country. Economic prospects of Philippines have grown, which in turn would augur well for economic development at Philippines. Though there has not been any negative impact on macroeconomic outlook of Philippines economy, yet this nation has faced some setbacks because of various external reasons. It has also faced challenges from regional competitors. Main focus of Philippines has been to develop employment opportunities and lessen poverty. Long term Philippines economic development can only be possible if these areas are properly taken care of. Purchasing power parity of GDP for fiscal year 2008 was $327.2 billion, while official exchange rate of GDP was $172.3 billion. Per capita GDP as was recorded in 2008 was $3,400 and 4.5% is real growth rate in gross domestic product. Agricultural sector contributes about 13.8% to GDP, 2008 of Philippines economy and 31.9% is received from industry. From service sector of Philippines economy contribution towards Philippines GDP is about 54.3%. Philippines economic development is also result of agricultural products, which includes corn, sugarcane, pineapples, coconuts, bananas, rice, cassavas, mangoes and pork, eggs, beef and fish. Major industries that contribute to economic development of Philippines are wood products,

electronics assembly, food processing, footwear, garments, pharmaceuticals, chemicals, petroleum refining and fishing.

THE

McKEEVER INSTITUTE
OF

ECONOMIC POLICY ANALYSIS PHILIPPINES: Economic Policy Analysis

This site presents an analysis of the Philippine government's economic policies compared to a revised list of 34 economic policies as prepared by Mr. Rungleigh Kor with the McKeever Institute of Economic Policy Analysis (MIEPA) in December of 2005. To read the analysis scroll through this site. To learn more about the background policies, click here Introduction and Policy Recommendations

To learn more about MIEPA, click here Return to MIEPA's Home Page Rungleigh Kor, a Philippine native who currently [December 2005] lives in San Francisco, has completed a study of his home country government's economic policies as compared to the MIEPA list of policies as outlined above. The study on Philippines is shown below. The ratings herein are based on the following rating scale: RATING SCALE 5.0 Perfect Facilitation of Wealth Creation 4.0 Midway between Perfect and Neutral 3.0 Neutral Effect on Wealth Creation 2.0 Midway between Neutral and Obstructionist 1.0 Perfectly Obstructionist to Wealth Creation [Rating scale copyright Mike P. McKeever, 2005. Used herein with permission] To read a disclaimer about the analysis in this file, scroll to the bottom of the file.

Return to MIEPA's Home Page Philippines Comparison of Philippines' economic policies to MIEPA criteria as prepared by native student of Philippines, Mr. Rungleigh Kor, studying in the US in December of 2005.
RATING SUMMARY POLICY NUMBER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 RAW SCORE 4.0 3.0 1.0 4.5 4.0 4.0 4.0 2.0 1.0 5.0 5.0 1.0 4.0 2.0 3.0 4.0 1.0 1.5 1.5 1.5 1.0 4.0 ADJUSTED SCORE 12.0 9.0 3.0 13.5 12.0 12.0 12.0 6.0 3.0 15.0 15.0 2.0 8.0 4.0 6.0 8.0 2.0 3.0 3.0 3.0 2.0 8.0 POSSIBLE 15.0 15.0 15.0 15.0 15.0 15.0 15.0 15.0 15.0 15.0 15.0 10.0 10.0 10.0 6.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 PERCENTAGE 80 % 60 20 90 80 80 80 40 20 100 100 20 80 40 60 80 20 30 30 30 20 80

23 24 25 26 27 28 29 30 31 32 33 34 TOTAL

2.0 1.0 1.0 1.0 5.0 4.5 2.0 4.5 4.5 1.0 4.0 4.5 97.0 =====

4.0 2.0 2.0 2.0 10.0 9.0 2.0 4.5 4.5 1.0 4.0 4.5 211.0 ======

10.0 10.0 10.0 10.0 10.0 10.0 5.0 5.0 5.0 5.0 5.0 5.0 375.0 =====

40 20 20 20 100 90 40 90 90 20 80 90 56.0% =====

Return to MIEPA's Home Page

INDIVIDUAL POLICIES
1. Freedom from internal control: 4.0

The Philippines is a democratic society through and through. As such, the citizens are allowed to do anything they want in their own rights which is not a violation of the law. Outside of the governments laws, anyone can build a business on a location they like, purchase goods from local and foreign markets and such. Entrepreneurs do have to obtain a business permit from the city hall, but that is for merely validation purposes on the safety and cleanliness of what is intended to be sold. This is exemplified by the ability of people to import foreign goods and sell them in the local market. The citizens are free to move on their own discretion, although one may argue that this is the reason why so many crimes are committed in the Philippines. Nonetheless, with the independence of the country came the independence of the people, which earns high marks for the Philippines on this policy. Source: http://en.wikipedia.org/wiki/Philippines; http://www.usaid.gov/locations/asia_near_east/countries/philippines/philippines.html and personal 2. Freedom of Speech: 3.0

For a country that is heavily influenced by the American government and constitution, the Philippines apparently did not find the Freedom of Speech appealing, or maybe not as much. In a social view, there is freedom of speech as evident in the famous non-bloody revolutions of the Philippines, EDSA 1, 2, 3. This revolution was heavily influenced by Catholic Christian priests, bishops and most importantly, beliefs in the Virgin Mary. On the other hand however, there is an apparent religious intolerance when discussing about Muslim, Protestant and other religions belief, quickly dismissing them as inappropriate and sometimes heretic. In the economic stand point, the Philippines has less freedom of speech as evident in businesses. For example, a soda company like Coke cannot say the name or compare it to Pepsi when in a commercial; its against the law. There are other civil restrictions present in the industry. However, the thing the encompasses both viewpoints is the government. Whatever they say, the government has an amount of influence on the media and the press which forbids the media to directly criticize the government beyond a certain extent (on contrast of USAs Meet the Press). But, these are relatively minor things in the society, for when the people really want it, they can and will achieve freedom to speak their mind. Its just that there is a possibility that these statements will only reach the deaf ears of the government. The Philippines gets a neutral score for this policy. Source: http://en.wikipedia.org/wiki/EDSA_Revolution; http://www.smallwars.quantico.usmc.mil/search/LessonsLearned/philippines/bearers.asp and personal 3. Effective Police Force: 1.0 Although the crime rate in the Philippines is reported to be lower than other industrialized countries, it has been repeatedly reported in the news that investors are having a hard time to start a business in the Philippines because of the criminal acts. This may be because of the corrupt government or just the fact that the true crime rate may be hidden to mask the Philippine face from the world. Moreover, ask any Filipino and he or she will tell you that the police force is nothing short of hypocritical. There have been many expose documentaries on which policemen are shown to be accepting bribes from passengers against ticketing them legally. This is again due to the very low minimum wage; policemen often find accepting bribes more profitable than legally earning their paycheck. Lastly, because of the recent terrorist attacks from the Al-Queda group, the Abu Sayyaf, the crime rate in the Philippines shot up in terms of kidnappings, bombings and murders. The Philippines gets a very low score for this policy. Source: http://www-rohan.sdsu.edu/faculty/rwinslow/asia_pacific/philippines.html; and http://en.wikipedia.org/wiki/Abu_Sayyaf and personal. 4. Private Property: 4.5 The Philippines, in its numerous islands, value the right of private property. All titles of land are nationally recognized by the government. Moreover, the government takes real estate to a whole new level by selling parts of its islands to private investors in an attempt to increase the economy. Land deeds, as well as the protection of property are clear and concise in the eyes of law. Some of these laws include the Philippine Real Estate Acquisition and Disposition Laws,

which protect the right to private property. The idea of private property and real estate is perhaps the most profitable business right now in the Philippines, thus earning the Philippines high marks for this policy. Source: http://www.philestate.com/support.php and http://www.privateislandsonline.com/mystery.htm 5. Commercial Banks: 4.0 There are numerous banks in the Philippines that are commercial, some of which are international. Some of these include Equitable-PCI bank, Bank of America and China Bank. These commercial banks share a same function of being a retail and corporate full public service bank which include loans and investment; all of which are free from government influence. Moreover, these banks are known to be stable; the more popular ones lasting more than half a century. The Philippines gets a high score for this policy. Source: http://www.equitablepcib.com/ and http://mysearch.ph/knowledge-base/foreignbanks.htm 6. Communication Systems: 4.0 The Philippines certainly has the sufficient communication equipment in its possession. The Philippines for one, is considered to be the texting (cell phone messaging) capital of the world, outnumbering the number of texts continental Europe does in a month compared to what the Philippines does in the day. In addition, most television sets have access to news and entertainment through its local channels, not to mention the option to have cable access in order to see international news (e.g. CNN). Radios are perhaps the most abundant of all media sources in the Philippines; every house is certain to have one. Newspapers are widely spread and faxing and the computer (internet) has already been introduced quite some time before. However, the downside to this is that it is not totally spread throughout the country; most of it is only available in the urban areas. It is indeed understandable why the country does not expand its technology to the rural areas (the country is exceptionally culturally diverse) but the country does take a hit on this from an economic standpoint. The Philippines gets a marginal high score for this policy. Source: www.nokia.com.ph and www.abs-cbnnews.com and personal 7. Transportation: 4.0 In all aspects of transportation, the Philippines supplies the public with its needs. In addition to private transportation such as cars, people can opt to take public road transportation via taxis, jeepneys and tricycles (a motorcycle with a modified sidecar attached to it). As for rail, there is the Metro Rail Transit which travels vertically through the urban commercial areas and the Light Rail Transit which travels horizontally through the same areas. The public can opt to take ferries to travel from island to island, or take to the air via domestic flights mainly provided by the Philippine Airlines. The only downside to this though is the absence of most of these facilities in the rural areas (Visayas and Mindanao regions are thought of to be rural oriented, Luzon is

considered to be the urbanized region); the people from this region should travel to the urban cities to fully use these public services. The Philippines gets a relatively high score for this policy. Source: http://www.railway-technology.com/projects/manila/ and http://www.superferry.com.ph/ and http://www.philippineairlines.com/ 8. Education: 2.0 First of all, the Philippines does have a high literacy rate of 96%. Moreover, there are schools within the Philippines that are globally recognized such as De La Salle University. However, the reason why the most of the populations is still very much under the poverty line is because of the inability to access a college level education. To put it in simple terms, should the Philippine education be put into the United States, it has a great chance to flourish and prosper. Thats because people here can access this education easily, especially regarding financing. However, in the Philippines, the economy only allows the minority of middle and upper class citizens (about 20%) to access higher education. Moreover, when one only attains a secondary degree, he or she can expect to have a job in retail at best, which doesnt pay that well to begin with. Then, if this person decides to have a family, he or she cannot afford to send his or her child to higher education because of low wages. In short, it isnt the education system thats the problem, it is the lack to access it by the majority. The Philippines gets a relatively low score for this policy. Source: http://plasma.nationalgeographic.com/mapmachine/profiles/rp.html and personal 9. Social Mobility: 1.0 The rich get richer and the poor get poorer. This statement could not be more true in the Philippines. The reason why the media likes to emphasize on success stories so much is because it rarely happens. The rags-to-riches story only appears once a decade on average. This is because of the numerous barriers in Philippine society like corrupt government and lack of access to substantial education. If one asks any Filipino, he or she would say that hard work is not by any means a guarantee that you will get rich; it depends more on luck. The Philippines gets a very low score for this policy. Source: Personal 10. Freedom from outside control: 5.0 The last instance that the Philippines was under foreign control was back on World War Two. After initially being under the Americans, the events on WWII resulted in the Philippines as an American territory under Japanese control. When the Americans defeated the Japanese however, it would not be long before the Philippines would gain its independence. Thus, on July 4th 1946, the Philippines was granted its freedom and was not occupied ever since. Moreover, the Philippines ensured its protection by enlisting themselves as a member in the United Nations on October 24, 1945. This move gave the Philippines an international image and security in the midst of foreign countries. The Philippines gets high marks for this policy.

Source: http://en.wikipedia.org/wiki/Philippine_Independence_Medal and http://www.un.org/Overview/unmember.html 11. Foreign currency transactions: 5.0 The Philippine monetary unit is the Philippine Peso. It is the only currency accepted and used as money in the Philippines. Foreign currency should and must be exchanged at local establishments in order to purchase products and services sold in the Philippines. The country gets a high score on this policy. Source: http://www.philippine-islands.info/ and personal 12. Border Control: 1.0 The Philippines, simply put, does not have border control. This is not because of any lack on the governments part however; it is because of the way the Philippines is geographically. The Philippines, being a country with over 7000 islands, cannot possibly monitor transactions between these islands. Therefore, certain disruptions like piracy and smuggling will always be present, and cannot be avoided. Indeed, it is tragic, but it still needs to be dealt with regards to an economic and business view. The Philippines gets a very low score for this policy. Source: http://images.google.com/images?q=tbn:21QF8AjpU4QJ:www.philippines.travelmall.com/count ry_images/philippines_map.gif and personal. 13. Currency: 4.0 The Philippine Peso, albeit struggling, is still very much in use within the country. Moreover, most business institutions (with the exception of banks) require that purchases be only made with the Peso. As such, the businesses usually provide foreign exchange booths in their establishments to tend to the needs of foreigners and locals alike. Even foreign businesses such as GAP or SONY in the Philippines only accept Philippine pesos. However, with the presence of foreign exchange facilities virtually everywhere, there is usually no need for conflict. The Philippines gets high marks for this policy. Source: http://www.filipina-women.com/traveltips.htm and personal 14. Cultural, Language Homogeneity: 2.0 When the Philippines was founded by the Spanish in the 16th century, they encountered few of the numerous ethnic tribes. Up until today, there are still many, many tribes in the Philippines, all with their own languages. Some believe that the reason for this is because the Philippines is an island country, so isolation of the tribes could be very apparent in the 7000+ islands. Nevertheless, this presents a language barrier in the whole country. Moreover, even urbanized people speak their own slang if you will, especially in the northern parts of the Philippines.

This presents an unwanted diversity in economic terms, and thus earns a low mark for the Philippines in this policy. Source: http://www.emailpinoy.com/educational/philippines-tribes.shtml 15. Political Effectiveness: 3.0 The Philippines, being an island-country, does have its disadvantages. For one, technology between the urban and rural areas are very far apart. This makes communication between the government and the rural areas very hard to do. And without communication, there is a harder implementation of the political process in these parts of the country. The Philippine government has tended to focus most of its energy on urban planning rather than rural issues. Unfortunately, even in urban planning, the political process is failing because of controversial politics and corruption; so what more could be expected for rural issues? However, because of the way the Philippine government is structured, there are some local governments who try to make processes work in the rural areas. Moreover, the government is indeed trying to start institutions to handle the management, productivity and advancement of the rural areas, such as the Philippine Partnership for the Development of Human Resources in the Rural Areas. The Philippines gets points for effort, but loses the same because of their ineffectiveness in following through in striving for political effectiveness. The Philippines gets a neutral score for this policy. Source: http://www.psdn.org.ph/phildnet/About_Phildhrra/Phildhrra_Members/phildhrra_members.html and Personal 16. Institutional Stability: 4.0 It would not be surprising for a person to find out that many of the Filipino institutions date back to 50, or maybe even 100 years back. This shows that when these organizations were built, the planning was so effective that it is still successful and stable up until now. For example, the University of Santo Tomas (Saint Thomas) was founded more than 4 centuries ago. This was built by the Spanish who came to colonize the Philippines during the 17th century. Up until now, their system of teaching (especially in religion) is still being used today. As for the government, the Philippines has taken the United States type of government, originating as far as the 19th 20th century when the Philippines was under American control. That is still the same government in effect today. In more recent terms, the Philippine National Police, formed in 1989, is still working and serving the country amidst the intense political strive during the 90s and even in the potential threat of revolution today. The Philippines gets a high score for this policy. Source: http://en.wikipedia.org/wiki/Philippine_National_Police http://www.ust.edu.ph/innerhome/countdown2011.asp and Personal 17. Honest Government: 1.0

The Philippines has the second most corrupt government in Asia and the 12th or 13th most corrupt in the world. With that being said, the Philippines has always had the notorious reputation of politics first, people second. If its any proof, the last two presidents (including the current one) have either been impeached or have faced impeachment. In that sense, the current president of the Philippines, Gloria-Macapagal Arroyo, is still facing an impeachment case against her for her being caught in the act of cheating in the elections. The main evidence in this case is the taped recording of her phone conversation with one of the election officials. But, even with this huge evidence AND the fact that she admitted to it already, she is still trying to cover up the case and delay or even annul it as much as possible. Even with the continuing rallying of the democratic people, it seems that the government just turns a deaf ear to the cry of justice. The Philippines gets the lowest mark possible for this policy. Source: http://newsfromrussia.com/world/2005/08/30/61958.html and Personal 18. Common Laws: 1.5 There is certainly a set of common laws for everyone to follow in the Philippines. However, these laws are also commonly disregarded by the citizens. These not only take the form of discreet robberies and theft, but there is also a blatant atmosphere of defiance in most of the urban establishments. For example, the Philippines has recently passed laws concerning piracy and the ban of sales of pirated/fake CDs. But, most of the malls and stores spread throughout the whole of the Philippines sell everything from pirated music CDs to pirated fake movie DVDs. The lack of enforcement for common laws gets low marks for the Philippines. Source: Personal 19. Central Bank: 1.5 The Central Bank of the Philippines is a government owned enterprise. As such, one could expect that there is some sort of political control on the central bank, especially with the Philippine government. The Central Bank of the Philippines has a history of becoming too diversified. Moreover, this central bank is expected to not function as an independent bank but to help finance the government deficits. Therefore, the central bank was relatively ineffective in developing financial markets and the bank just imposed a greater cost to society. It focuses too much on political issues and more often than not, puts its duties to the citizens aside. Struggling with the poor economy of the Philippines doesnt help the banks job either. The Philippines gets a low mark for this policy. Source: http://www.trv.net/phuket/general/articles/thaiphil.htm and Personal 20. Domestic budget management: 1.5 The Philippine budget deficit in short, is very much bigger than the budget itself. For at least the past three years, the deficit has been going up at a rapid rate, reaching a ceiling mark of P180 B (roughly $3.21 B) while the budget is at an average of $1 B. However, it is showing

signs dropping down to P100 B ($1.80 B) so it may be an improvement in the governments part. Nevertheless, the Philippines gets a low score for this policy. Source: http://www.biz-day.com/read/energy/03_mar_05/f9cvzp/egat_employees_say_that_union_leader_must_go.htm 21. Government Debt: 1.0 The Philippines has been notoriously known for its foreign debt, especially to the United States. The statistics are as follows: Foreign Debt for 2004: $54.9 B GNP for 2004: $1.024 B Foreign Debt for 2005: $56.1 B Percent of Government budget going to debt payments: appx. 40% As shown, the Philippine debt is more than 50 times over the countrys GNP for a year. Banks have said that the weighted average of maturity of such debt stands at 16.7 years. Moreover, the debt is making up of more than half of the countrys annual budget and even that is relatively small compared to the size of the debt. The Philippines gets a very, very low score for this policy. Source: http://dirp.pids.gov.ph/eismain.html and http://money.inq7.net/breakingnews/view_breakingnews.php?yyyy=2003&mon=09&dd=23&fil e=17 22. Economic statistics: 4.0 In the Philippines, the economic resources there are usually found in magazines made internationally such as Time magazine and the like. However, the internet has provided many non-government sites for one to be able to fully gauge the Philippine economy. These are of course published websites and highly commented by independent readers. Moreover, in the media, there is usually a business section in the news where the exchange rate and stock exchanges are posted on a daily basis. These statistics come from the top news media in the country and is known to be very dependable. The Philippines gets a high score for this policy. Source: http://dirp.pids.gov.ph/eismain.html and personal 23. Protection of Public health and safety: 2.0 Infant mortality rate: 24.24 deaths/1,000 live births

Tuberculosis cases - Per 100,000: 226V Tuberculosis immunization: 87%V Life Expectancy from birth: 68.0 yearsV The Philippines infant mortality rate is the 84th highest out of 179 country statistics collected by the UN. As for the tuberculosis cases, it is the 17th highest out of 165, despite the relatively high immunization rate. Life expectancy is 101st out of 175. The Philippines isnt known for its public health and as far as the UN standards go, Philippine Public health is relatively low. The Philippines gets a low score for this policy. Source: http://www.nationmaster.com/country/rp/Health 24. High Wage Policies: 1.0 The Philippines have already set a minimum wage policy of P198, or approximately $5.00 every day. However, most company owners do not follow this policy, sometimes offering dramatically less. The wages in companies sometimes go as low as P100 for blue-collar and white-collar workers. This may be because of the lack of enforcement of the wages in the country. Moreover, even if the minimum wage policy does get followed, it is hardly enough to compensate for everyday living. For example, if one family of four should eat only one meal per day (average of P40 per person), then it would be equal to P160 already. Thats excluding housekeeping, taxes and other expenses. The Philippine economy is not enough to give people higher wages or even lower prices. Approximately 80% of the Philippine population lies below the poverty line because of the lack of work or the lack of good wages. The Philippines gets a very low score for this policy. Source: http://www.dol.gov/ilab/media/reports/oiea/wagestudy/FS-Philippines.htm http://asia.news.yahoo.com/050103/4/1u2s1.html and personal 25. Environmental protection: 1.0 The Philippine government, as with any other government, tries to provide laws towards the protection of the environment. However, if a foreigner does travel to the Philippines, the protection is yet to be seen. At a distance, it is almost certain that you will see black, putrid smoke coming out of a factory, thus polluting the air. In rural areas, there are always signs of deforestation, especially on mountains. In urban areas, if one travels by car across a bridge, not only will he see the massive amount of garbage on a river, but he will most likely also see people throwing stuff into the river. This is so because of the lack of authoritative backing on the environmental projects and laws. The no throwing of garbage signs cannot be seen, because of the huge amount of garbage covering the sign. The Philippines gets a very low score for this policy. http://philenvlaw.blogspot.com/ and http://www.peopleandplanet.net/doc.php?id=102 (picture in the middle) and Personal. 26. Strong Army: 1.0

The Philippines is a very small country compared to its neighbors in Asia like China, Indonesia or Japan. Thus, they have depended on international security agreements and organizations, like the U.N. However, this does not excuse the apparent disregard of the Philippine government towards the growth of the military. The Philippine military has been using sub-par weapons and technologies since the 1990s and as the 21st century came by, nothing has changed in terms of advancement. Philippine Budget for 2005: appx. $16.2 B Military Budget: $0.78 B Percentage: 4.81% Approximately 5% goes into the military budget. The reason that the Philippine government gives so little is because the country is currently experiencing a fiscal crisis. However, that is no excuse to not provide enough funds to improve military equipment to at least protect the country from itself. The Philippines gets a very low mark for this policy. Source: http://news.inq7.net/nation/index.php?index=1&story_id=30341 27. Foreign trade impact: 5.0 GDP (as of Q2 2005) = $23.06 B Export: $3.462 B Import: $4.005 B Total: $7.467 B / $ 23.06 B x 100 = 32% As seen here, the Philippines, even though a third world country, has managed to get very close to the ideal balance of trade and GDP. The Philippines gets a perfect score for this policy. Source: http://www.census.gov.ph/ 28. Protection of foreign currency earning enterprises: 4.5 The world is turning to a very globalized world where export and import are becoming a very powerful tool for generating profit. Thus, the Philippines has also taken measure into insuring and propagating the export of its products through a company called the PhilEXIM. This government controlled companys objective is to encourage, insure and protect the companies that wish to export their product. They provide insurance cover, credit and other services to licensed businesses. They also give technical assistance in the preparation and execution of development or expansion programs. This, along with many more functions, therefore gives the Philippines very high marks for this policy.

Source: http://zeus.philexim.gov.ph/index.php 29. Management of foreign currency budget: 2.0 The Philippines has always been an Americanized country ever since its independence on July 4th, 1946. Of course, there are many advantages of keeping close such a close contact with a country. However, there are some big disadvantages to being too Americanized. Statistics as accurate as June/July 2005: Exports: $3.462 B Imports: $4.005 B Balance of Trade: -$653 M As shown here, the Philippines has been importing too much goods into its economy. Moreover, most of it are American or Japanese products. Because both major sources of import have a higher economy than the Philippines, the local economy suffers because it is paying more for a big amount of imports and receiving less for small amount of exported products. The Philippines receive low scores for this policy. Source: http://www.census.gov.ph/ and Personal 30. Layers of Collective Action: 4.5 At first glance, the Philippine Government may seem hierarichal in terms of its form. But, each city in the Philippines has its own local government. These local governments generate their own funds from taxes from private businesses or other financial institutions. In addition, the officials in these local governments get elected by the people in that city, and these elections are separate from that of the central government. One election in a city could be different from the other, from the day its run to the rules of election. In short, each citys local government can stand on its own. The Philippines get high marks if not a perfect score for this policy. Source: http://www.gov.ph/govlinks/localgov.asp and http://www.makati.gov.ph/default.php 31. Pro Business Climate: 4.5 The Philippines, being a third-world country, has only a handful of people belonging to the elite society. These elites are of course rich, but more importantly, they started a business that grew and grew. Therefore, these people are placed in a high social status because of the simple fact that they live a very good life in a poor country. When a person makes his first million, especially if he or she is young, they are featured on either the television or the newspaper. These people are then looked up to by the citizens of the country, not only because of the money they made, but their rags-to-riches success stories as well. One such story is that of a man who started a humble shoe store and years later, he now owns the biggest line of malls in the country, SM. Another story is that of someone who started out with no capital whatsoever, but by using his talents, got his first million at the age of 26. These kinds of people are revered

by the rest of the country, who in turn start their own businesses in hope that they too will end up with their own success story. The Philippines receive high marks for this policy. Source:http://money.inq7.net/topstories/view_topstories.php?yyyy=2005&mon=09&dd=11&file =2 and Personal 32. Government enterprises: 1.0 Government owned businesses and enterprises in the Philippines are plenty. The majority of these businesses attend to the everyday needs of the Filipino, which should be good. However, only a handful of these businesses are felt by the citizens. For example, the social security system in the Philippines is very different form that of the US. There are virtually no benefits to be had from the Philippine SSS, not even monetary aid for the unemployed and aged. Surprisingly, the businesses that generate the most impact in the Philippines are that outside the necessities of the citizens. The Light Rail Transit Company does provide transportation, but they have very poor maintenance. Also, most of the government owned businesses are agricultural-based, but farmers and the like have always been known to be poor because they have no one to turn to sell their products. Thus, these agricultural businesses are clearly only for aesthetic value and nothing more. From businesses that are not felt by its citizens, to enterprises which clearly cant run on its own, its safe to say that these government enterprises get their money elsewhere, just not themselves. The Philippines earns low marks for this policy. Source: Personal and http://www.gov.ph/govlinks/gocc.asp 33. International Security Agreements: 4.0 The Philippines, for at least the past 50 years, has been no stranger in the eyes of the American Government. They have enjoyed close ties with each other, especially now between Mr. George W. Bush and Miss Gloria Macapagal-Arroyo, the Philippine president. As a result, the US Philippine mutual defense treaty has been strenghthened quite recently because of the similarity of both presidents views, especially on terrorism. Because of this treaty, the US has been sending its troops to Philippine soil to help stop the terrorist attacks done by the Al-Queda group, the Abu Sayyaf. In turn, during the war on Iraq, the Philippines was one of the first to send its troops to the Middle East to help fight the war. There are many more examples of mutual defense between the two countries. Therefore, the Philippines gets high marks for its unity for security measures with the United States. Source: http://usembassy.state.gov/posts/rp1/wwwhr005.html 34. Protection of domestic enterprises from government mandated costs: 4.5 The Philippine government does not usually intervene with the policies of private businesses. Of course, the government has asked for a required level of cleanliness and security in businesses, but they dont go any further than that. Restaurants for example always have to provide clean water and surroundings, but certainly nothing out of the ordinary, practical needs of the consumers. There are also no conditions, be it environmental or social, that would warrant the

need of new and unheard of policies in domestic enterprises. The Philippines receive high marks for this policy. Source: Personal DISCLAIMER
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Introduction and Policy Recommendations

Winning Essays: There Are Alternatives Project (TAA) Essay: Balanced Trade: Toward the Future of Economics Moral Economics

McKEEVER INSTITUTE of ECONOMIC POLICY ANALYSIS

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ECONOMIC PLANNING AND POLICY

Philippines Table of Contents

The Philippines has traditionally had a private enterprise economy both in policy and in practice. The government intervened primarily through fiscal and monetary policy and in the exercise of its regulatory authority. Although expansion of public sector enterprises occurred during the Marcos presidency, direct state participation in economic activity has generally been limited. The Aquino government set a major policy initiative of consolidating and privatizing government-owned and government-controlled firms. Economic planning was limited largely to establishing targets for economic growth and other macroeconomic goals, engaging in project planning and implementation, and advising the government in the use of capital funds for development projects.

Development Planning
The responsibility for economic planning was vested in the National Economic and Development Authority. Created in January 1973, the authority assumed the mandate both for macroeconomic planning that had been undertaken by its predecessor organization, the National Economic Council, and project planning and implementation, previously undertaken by the Presidential Economic Staff. National Economic and Development Authority plans calling for the expansion of employment, maximization of growth, attainment of fiscal responsibility and monetary stability, provision of social services, and equitable distribution of income were produced by the Marcos administration for 1974-77, 1978-82, and 1983-88, and by the Aquino administration for 1987-92. Growth was encouraged largely through the provision of infrastructure and incentives for investment by private capital. Equity, a derivative goal, was to be achieved as the result of a dynamic economic expansion within an appropriate policy environment that emphasized laborintensive production. The National Economic and Development Authority Medium-Term Development Plan, 1987-92 reflected Aquino's campaign themes: elimination of structures of privilege and monopolization of the economy; decentralization of power and decision making; and reduction of unemployment and mass poverty, particularly in rural areas. The private sector was described as both the "initiator" and "prime mover" of the country's development; hence, the government was "to encourage and support private initiative," and state participation in the economy was to be minimized and decentralized. Goals included alleviation of poverty, generation of more productive employment, promotion of equity and social justice, and attainment of sustainable economic growth. Goals were to be achieved through agrarian reforms; strengthening the collective bargaining process; undertaking rural, labor-intensive infrastructure projects; providing social services; and expanding education and skill training. Nevertheless, as with previous plans, the goals and objectives were to be realized, trickle-down fashion, as the consequence of achieving a sustainable economic growth, albeit a growth more focused on the agricultural sector. The plan also involved implementing more appropriate, market-oriented fiscal and monetary polices, achieving a more liberal trade policy based on comparative advantage, and improving the efficiency and effectiveness of the civil service, as well as better enforcement of government laws and regulations. Proper management of the country's

external debt to allow an acceptable rate of growth and the establishment of a "pragmatic," development-oriented foreign policy were extremely important. Economic performance fell far short of plan targets. For example, the real GNP growth rate from 1987 to 1990 averaged 25 percent less than the targeted rate, the growth rate of real exports was one-third less, and the growth rate of real imports was well over double. The targets, however, did provide a basis for discussion of consistency of official statements and whether the plan growth rates were compatible with the maintenance of external debtrepayment obligations. The plan also set priorities. Both Aquino's campaign pronouncements and the policies embodied in the planning document emphasized policies that would favorably affect the poor and the rural sector. But, because of dissension within the cabinet, conflicts with Congress, and presidential indecisiveness, policies such as land and tax reform either were not implemented or were implemented in an impaired fashion. In addition, the Philippines curtailed resources available for development projects and the provision of government services in order to maintain good relations with international creditors. The Philippine government has undertaken to provide incentives to firms, both domestic and foreign, to invest in priority areas of the economy since the early 1950s. In 1967 an Investment Incentives Act, administered by a Board of Investments (BOI), was passed to encourage and direct investment more systematically. Three years later, an Export Incentives Act was passed, furthering the effort to move the economy beyond importsubstitution manufacturing. The incentive structure in the late 1960s and 1970s was criticized for favoring capital-intensive investment as against investments in agriculture and export industries, as well as not being sufficiently large. Export incentives were insufficient to overcome other biases against exports embodied in the structure of tariff protection and the overvaluation of the peso. The investment incentive system was revised in 1983, and again in 1987, with the goal of rewarding performance, particularly exporting and labor-intensive production. As a results of objections made by the United States and other industrial nations to export-subsidy provisions contained in the 1983 Investment Code, much of the specific assistance to exporters was removed in the 1987 version. The 1987 Investment Code delegates considerable discretionary power over foreign investment to the government Board of Investments when foreign participation in an enterprise exceeds 40 percent. Legislation under consideration by the Philippine Congress in early 1991 would limit this authority. Under the new proposal, foreign participation exceeding 40 percent would be allowed in any area not covered by a specified "negative list."

Fiscal Policy
Historically, the government has taken a rather conservative stance on fiscal activities. Until the 1970s, national government expenditures and taxation generally were each less than 10 percent of GNP. (Total expenditures of provincial, city, and municipal governments were small, between 5 and 10 percent of national government expenditures in the 1980s.) Under the Marcos regime, national government activity increased to between

15 and 17 percent of GNP, largely because of increased capital expenditures and, later, growing debt-service payments. In 1987 and 1988, the ratio of government expenditure to GNP rose above 20 percent. Tax revenue, however, remained relatively stable, seldom rising above 12 percent of GNP. Chronic government budget deficits were covered by international borrowing during the Marcos era and mainly by domestic borrowing during the Aquino administration. Both approaches contributed to the vicious circle of deficits generating the need for borrowing, and the debt service on those loans creating greater deficits and the need to borrow even more. At 5.2 percent of GNP, the 1990 government deficit was a major consideration in the 1991 standby agreement between Manila and the IMF. Over time, the apportionment of government spending has changed considerably. In 1989 the largest portion of the national government budget (43.9 percent) went for debt servicing. Most of the rest covered economic services and social services, including education. Only 9.1 percent of the budget was allocated for defense. The Philippines devoted a smaller proportion of GNP to defense than did any other country in Southeast Asia. The Aquino government formulated a tax reform program in 1986 that contained some thirty new measures. Most export taxes were eliminated; income taxes were simplified and made more progressive; the investment incentives system was revised; luxury taxes were imposed; and, beginning in 1988, a variety of sales taxes were replaced by a 10 percent value-added tax--the central feature of the administration's tax reform effort. Some administrative improvements also were made. The changes, however, did not effect an appreciable rise in the tax revenue as a proportion of GNP. Problems with the Philippine tax system appear to have more to do with collections than with the rates. Estimates of individual income tax compliance in the late 1980s ranged between 13 and 27 percent. Assessments of the magnitude of tax evasion by corporate income tax payers in 1984 and 1985 varied from as low as P1.7 billion to as high as P13 billion. The latter figure was based on the fact that only 38 percent of registered firms in the country actually filed a tax return in 1985. Although collections in 1989 were P10.1 billion, a 70 percent increase over 1988, they remained P1.4 billion below expectations. Tax evasion was compounded by mismanagement and corruption. A 1987 government study determined that 25 percent of the national budget was lost to graft and corruption. Low collection rates also reinforced the regressive structure of the tax system. The World Bank calculated that effective tax rates (taxes paid as a proportion of income) of lowincome families were about 50 percent greater than those of high-income families in the mid-1980s. Middle-income families paid the largest percentage. This situation was caused in part by the government's heavy reliance on indirect taxes. Individual income taxes accounted for only 8.9 percent of tax collections in 1989, and corporate income taxes were only 18.5 percent. Taxes on goods and services and duties on international transactions made up 70 percent of tax revenue in 1989, about the same as in 1960. The consolidated public sector deficit--the combined deficit of national government, local

government, and public-sector enterprise budgets--which had been greatly reduced in the first two years of the Aquino administration, rose to 5.2 of GNP by the end of 1990. In June 1990, the government proposed a comprehensive new tax reform package in an attempt to control the public sector deficit. About that time, the IMF, World Bank, and Japanese government froze loan disbursements because the Philippines was not complying with targets in the standby agreement with the IMF. As a result of the 1990-91 Persian Gulf crisis, petroleum prices increased and the Oil Price Stabilization Fund put an additional strain on the budget. The sudden cessation of dollar remittances from contract workers in Kuwait and Iraq and increased interest rates on domestic debt of the government also contributed to the deficit. Negotiations between the Aquino administration and Congress on the administration's tax proposals fell through in October 1990, with the two sides agreeing to focus on improved tax collections, faster privatization of government-owned and government-controlled corporations, and the imposition of a temporary import levy. A new standby agreement between the government and the IMF in early 1991 committed the government to raise taxes and energy prices. Although the provisions of the agreement were necessary in order to secure fresh loans, the action increased the administration's already fractious relations with Congress.

Monetary Policy
The Central Bank of the Philippines was established in June 1948 and began operation the following January. It was charged with maintaining monetary stability; preserving the value and covertibility of the peso; and fostering monetary, credit, and exchange conditions conducive to the economic growth of the country. In 1991 the policy-making body of the Central Bank was the Monetary Board, composed of the governor of the Central Bank as chairman, the secretary of finance, the director general of the National Economic and Development Authority, the chairman of the Board of Investment, and three members from the private sector. In carrying out its functions, the Central Bank supervised the commercial banking system and managed the country's foreign currency system. From 1975 to 1982, domestic saving (including capital consumption allowance) averaged 25 percent of GNP, about 5 percentage points less than annual gross domestic capital formation. This resource gap was filled with foreign capital. Between 1983 and 1989, domestic saving as a proportion of GNP declined on the average by a third, initially because of the impact of the economic crisis on personal savings and later more because of negative government saving. Investment also declined, so that for three of these years, domestic savings actually exceeded gross investment. From the time it began operations until the early 1980s, the Central Bank intervened extensively in the country's financial life. It set interest rates on both bank deposits and loans, often at rates that were, when adjusted for inflation, negative. Central Bank credit was extended to commercial banks through an extensive system of rediscounting. In the 1970s, the banking system resorted, with the Central Bank's assistance, to foreign credit on terms that generally ignored foreign-exchange risk. The combination of these factors

mitigated against the development of financial intermediation in the economy, particularly the growth of long-term saving. The dependence of the banking system on funds from the Central Bank at low interest rates, in conjunction with the discretionary authority of the bank, has been cited as a contributing factor to the financial chaos that occurred in the 1980s. For example, the proportion of Central Bank loans and advances to governmentowned financial institutions increased from about 25 percent of the total in 1970 to 45 percent in 1981-82. Borrowings of the government-owned Development Bank of the Philippines from the Central Bank increased almost 100-fold during this period. Access to resources of this sort, in conjunction with subsidized interest rates, enabled Marcos cronies to obtain loans and the later bailouts that contributed to the financial chaos. At the start of the 1980s, the government introduced a number of monetary measures built on 1972 reforms to enhance the banking industry's ability to provide adequate amounts of long-term finance. Efforts were made to broaden the capital base of banks through encouraging mergers and consolidations. A new class of banks, referred to as "expanded commercial banks" or "unibanks," was created to enhance competition and the efficiency of the banking industry and to increase the flow of long-term saving. Qualifying banks-those with a capital base in excess of P500 million--were allowed to expand their operations into a range of new activities, combining commercial banking with activities of investment houses. The functional division among other categories of banks was reduced, and that between rural banks and thrift banks eliminated. Interest rates were deregulated during the same period, so that by January 1983 all interest rate ceilings had been abolished. Rediscounting privileges were reduced, and rediscount rates were set in relation to the cost of competing funds. Although the short-term response seemed favorable, there was little long-term change. The ratio of the country's money supply, broadly defined to include savings and time deposits, to GNP, around 0.2 in the 1970s, rose to 0.3 in 1983, but then fell again to just above 0.2 in the late 1980s. This ratio was among the lowest in Southeast Asia. Monetary and fiscal policies that were set by the government in the early 1980s, contributed to large intermediation margins, the difference between lending and borrowing rates. In 1988, for example, loan rates averaged 16.8 percent, whereas rates on savings deposits were only slightly more than 4 percent. The Central Bank traditionally maintained relatively high reserve requirements (the proportion of deposits that must remain in reserve), in excess of 20 percent. In 1990 the reserve requirement was revised upward twice, going from 21 percent to 25 percent. In addition, the government levied both a 5 percent gross tax on bank receipts and a 20 percent tax on deposit earnings, and borrowed extensively to cover budget deficits and to absorb excess growth in the money supply. In addition to large intermediation margins, Philippine banks offered significantly different rates for deposits of different amounts. For instance, in 1988 interest rates on six-month time deposits of large depositors averaged almost 13 percent, whereas small savers earned only 4 percent on their savings. Rates offered on six-month and twelve-month time deposits differed by only 1 percentage point, and the rate differential for foreign currency deposits of all available maturities was within a single percentage point range. Because

savings deposits accounted for approximately 60 percent of total bank deposits and alternatives for small savers were few, the probability of interest rate discrimination by the commercial banking industry between small, less-informed depositors and more affluent savers, was quite high. Interest rates of time deposits also were bid up to reduce capital flight. This discrimination coupled with the large intermediation margins, gave rise to charges by Philippine economists and the World Bank that the Philippine commercial banking industry was highly oligopolistic. Money supply growth has been highly variable, expanding during economic and political turmoil and then contracting when the Philippines tried to meet IMF requirements. Before the 1969, 1984, and 1986 elections, the money supply grew rapidly. The flooding of the economy with money prior to the 1986 elections was one reason why the newly installed Aquino administration chose to scrap the existing standby arrangement with the IMF in early 1986 and negotiate a new agreement. The Central Bank released funds to stabilize the financial situation following a financial scandal in early 1981, after the onset of an economic crisis in late 1983, and after a coup attempt in 1989. The money was then repurchased by the Treasury and the Central Bank--the so-called Jobo bills, named after then Central Bank Governor Jose Fernandez--at high interest rates, rates that peaked in October 1984 at 43 percent and were approaching 35 percent in late 1990. The interest paid on this debt necessitated even greater borrowing. By contrast, in 1984 and 1985, in order to regain access to external capital, the growth rate of the money supply was very tight. IMF dictates were met, very high inflation abated, and the current account was in surplus. Success, however, was obtained at the expense of a steep fall in output and high unemployment.

Privatization
When Aquino assumed the presidency in 1986, P31 billion, slightly more than 25 percent of the government's budget, was allocated to public sector enterprises--government-owned or government-controlled corporations--in the form of equity infusions, subsidies, and loans. Aquino also found it necessary to write off P130 billion in bad loans granted by the government's two major financial institutions, the Philippine National Bank and the Development Bank of the Philippines, "to those who held positions of power and conflicting interest under Marcos." The proliferation of inefficient and unprofitable public sector enterprises and bad loans held by the Philippine National Bank, the Development Bank of the Philippines, and other government entities, was a heavy legacy of the Marcos years. Burdened with 296 public sector enterprises, plus 399 other nonperforming assets transferred to the government by the Philippine National Bank and the Development Bank of the Philippines, the Aquino administration established the Asset Privatization Trust in 1986 to dispose of government-owned and government-controlled properties. By early 1991, the Asset Privatization Trust had sold 230 assets with net proceeds of P14.3 billion. Another seventy-four public sector enterprises that were created with direct government investment were put up for sale; fifty-seven enterprises were sold wholly or in part for a total of about P6 billion. The government designated that about 30 percent of the original

public sector enterprises be retained and expected to abolish another 20 percent. There was widespread controversy over the fairness of the divestment procedure and its potential to contribute to an even greater concentration of economic power in the hands of a few wealthy families.

Presidency of Gloria Macapagal-Arroyo

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Presidency of Gloria Macapagal-Arroyo

14th President of the Philippines In office January 20, 2001 June 30, 2010 Vice Teofisto Guingona (2001-2004)

President

Noli de Castro (2004-2010)

Preceded by Joseph Estrada Succeeded by Benigno Aquino III Personal details Born Political party April 5, 1947 (age 64)[1] San Juan City, Philippines Lakas-Kampi-CMD (2009present)

Other LDP (Before 1998) political KAMPI (19972009) affiliations Lakas-CMD (19982009) Spouse(s) Jose Miguel Arroyo

Edmund A. Walsh School of Foreign Service Assumption College Alma mater Ateneo de Manila University University of the Philippines School of Economics Profession Economist Religion Signature Website Official website Roman Catholicism

The Presidency of Gloria Macapagal-Arroyo spans from January 20, 2001 to June 30, 2010. Her term ended on June 30, 2010, pursuant to the provisions of the 1987 constitution.

Contents
[hide]

1 Overview 2 Administration and Cabinet o 2.1 Other cabinet-level and high posts o 2.2 Gallery 2.2.1 Malacaang Staff 2.2.2 Domestic 2.2.3 Economic 2.2.4 Environment and Energy 2.2.5 Foreign Affairs and National Security 3 Supreme Court Appointments 4 First Term (2001-2004) o 4.1 Succession o 4.2 2001 Midterm Elections o 4.3 Oakwood mutiny o 4.4 2004 Presidential Election 5 Second Term (2004-2010) o 5.1 Inauguration o 5.2 State of Emergency o 5.3 2007 Midterm Elections o 5.4 The Manila Peninsula Rebellion o 5.5 Impeachment complaints o 5.6 Estrada pardon o 5.7 Martial Law o 5.8 Congressional bid in Pampanga 6 Domestic policies o 6.1 Economy o 6.2 Charter change o 6.3 Executive Order No. 464 and calibrated preemptive response o 6.4 Human rights o 6.5 Amnesty proclamation 7 Foreign Policies o 7.1 Iraq War o 7.2 ASEAN Summit o 7.3 Philippines-Japan Trade Deal o 7.4 Council of Women World Leaders 8 Pardons 9 Controversies o 9.1 Fertilizer Fund Scam o 9.2 Hello Garci Controversy o 9.3 National Broadband Network Scandal o 9.4 Controversial Dinner party and Ondoy o 9.5 Northrail Controversy 10 End of Presidency 11 References 12 External links

[edit] Overview
This section does not cite any references or sources. Please help improve this section by adding citations to reliable sources. Unsourced material may be challenged and removed.
(January 2011)

Presidential styles of

Gloria Macapagal-Arroyo
Reference style Spoken style Alternative style Her Excellency,Gloria Macapagal-Arroyo President Arroyo, President MacapagalArroyo, PGMA Madame President

Gloria Macapagal-Arroyo assumed the presidency on January 20, 2001, following the 2nd EDSA revolution that ousted democratically-elected President Joseph Estrada. As she anticipated this event, she told Time International in a November 2000 interview that she planned to look to two predecessors as examples: "I will follow my father's footsteps in doing what is right, and God will take care of the rest. My father is my role model. My living role model is Cory Aquino. I am prepared." Although her recent predecessors had lived outside Malacaang Palace, Macapagal-Arroyo opted to return to her girlhood home. The new president faced numerous challenges, including an unstable economy and violent protests launched by Estrada's supporters. She was also accused of providing special treatment to the jailed former president. On May 27, 2001, Islamic militants abducted 20 hostages at a resort in the province of Palawan, and Macapagal-Arroyo was thrust into the ongoing battle between the Philippine government and the rebel forces, known as Abu Sayyaf. Several other kidnappings by various criminal gangs followed. Macapagal-Arroyo officially adopted a hardline "no ransom" response to the rebels and launched military operations against them. Her administration was embarrassed, however, when it was revealed that several of the hostages families paid ransom to the kidnappers directly, with some claiming that Philippine military officers received a portion of the funds. The Macapagal-Arroyo administration received another black mark when Mike Arroyo was accused of receiving bribes from a telecommunications company seeking government-approved contracts. On the economic front, Macapagal-Arroyo developed a blueprint to lift the Philippines out of its financial crisis. In 2002, looking back on her first year as president, she cited the country's economic survival as her greatest achievement, although she remained well aware that much work lay ahead, according to The Power and the Glory. "We have been able to survive, to have a

higher growth rate than our neighbors," she said. "I dwell on what must be done. I am a very focused person. I don't focus on laurels, on feeling secure, feeling comfortable. Even on the day I was sworn in as president, I didn't say, 'Wow, I am now president,' I said, 'What should I do now?' " Despite the obstacles and various charges of impropriety directed at those close to her, Macapagal-Arroyo was elected to a full six-year presidential term in May 2004. She edged out her closest competitor, Filipino actor Fernando Poe Jr., by only one million votes. In her inaugural address, Macapagal-Arroyo vowed to create up to 10 million jobs in the next six years, balance the budget, improve tax collection, provide inexpensive medicine for the poor, and unite the country. "Our nation must embrace a vision of economic opportunity, social cohesion and always an everdemocratic faith," she stated, as quoted in the July 1, 2004, edition of the International Herald Tribune. Macapagal-Arroyo made international headlines in July after a Filipino driver was kidnapped by militant rebels in war-torn Iraq. In defiance of the United States government's requests, Macapagal-Arroyo honored the rebels' demands to pull all Filipino troops out of the country. Later that month, she called for an end to political in-fighting in her own nation in order to turn the focus to economic recovery. After former president Estrada declared the Philippines a "nation in distress," as reported on CNN.com on July 23, 2004, Macapagal-Arroyo stated in a State of the Nation address, "Let us set aside political bickering and politicking for at least one year." She also used the address to reiterate her pledge to relieve poverty and promote economic growth.

[edit] Administration and Cabinet

Title President
Head of State Head of Government

Name

Term

Gloria Macapagal-Arroyo

20012010

Vice President

Teofisto Guingona Noli de Castro

20012004 20042010 20012003 20032005 20052010 January - February 2001

Agrarian Reform Secretary

Hernani Braganza Rene C. Villa Nasser C. Pangandaman

Agriculture Secretary

Domingo F. Panganiban

Leonardo Q. Montemayor Luis Lorenzo Arthur Yap Domingo F. Panganiban Budget and Management Secretary Emilia T. Boncodin Romulo Neri Rolando Andaya Education Secretary Raul Roco Edilberto de Jesus Florencio Abad Fe Hidalgo (acting) Jesli Lapus Mona Valisno Energy Secretary Jose Isidro Camacho Vincent Perez Raphael P. M. Lotilla Angelo Reyes Environment and Natural Resources Secretary Heherson Alvarez Elisa Gozun Mike Defensor Angelo Reyes Lito Atienza

20012002 20022004 20042005, 20062010 20052006 20012005 20052006 20062010 20012003 20032004 20042005 20052006 20062010 20102010 Jan. 2001-June 2001 20012004 20042007 20072010 20012003 20032004 20042006 20062007 20072010

Finance Secretary

Alberto Romulo Jose Isidro Camacho Juanita Amatong Margarito Teves

2001 20012003 20032005 20052010 Jan.2001-Feb.2001, 2002 20012002 20022003 20032004 20042010 20012004 20042009 20092010 20012004 20042006 20062010 20012003 2003 20032004 20042009 20092010 2010

Foreign Affairs Secretary

Gloria Macapagal Arroyo (acting) Teofisto Guingona Blas Ople Delia Albert Alberto Romulo

Health Secretary

Dr. Manuel Dayrit Francisco Duque, III Esperanza Cabral

Interior and Local Government Secretary

Joey Lina Angelo Reyes Ronaldo Puno

Justice Secretary

Hernando Perez Simeon Datumanong Merceditas N. Gutierrez Raul M. Gonzalez Agnes Devanadera Alberto Agra

Labor and Employment Secretary

Patricia Sto. Tomas

National Defense Secretary

Orly Mercado Angelo Reyes Eduardo Ermita

JanuaryFebruary 2001 20012003 20032004 20012005 20052006 20062008 20082009 20012003 2003 20032005 20052007, 20072010 February - June 2007 20012010 20012005 20012004 2004 20042010 20012003 20012004

National Economic and Development Authority

Romulo Neri Augusto Santos Romulo Neri Ralph Recto

Public Works and Highways Secretary

Simeon Datumanong Bayani Fernando Florante Soriquez Hermogenes E. Ebdane, Jr.. Manuel M. Bonoan

Science and Technology Secretary Social Welfare and Development Secretary Tourism Secretary

Estrella Alabastro Corazon Soliman Richard Gordon Roberto Pagdanganan Joseph Ace Durano

Transportation and Communications Secretary Trade and Industry Secretary

Pantaleon Alvarez Mar Roxas

[edit] Other cabinet-level and high posts

Executive Secretary o Renato de Villa (2001)

Renato Corona (acting) (2001) Alberto Romulo (20012004) Eduardo Ermita (20042010) Leandro Mendoza (2010) National Security Adviser o Roilo Golez (20012004) o Norberto Gonzalez (20042010) Press Secretary o Silvestre Afable (April - July 2002) o Milton Alingod (2003) o Hernani Braganza (20032004) o Ignacio Bunye (20042008) Presidential Spokesman o Rigoberto Tiglao (20012002) o Ignacio Bunye (20022008) Presidential Chief of Staff o Rigoberto Tiglao (20022004) o Michael Defensor (20062007) o Joey Salceda (2007) Presidential Management Staff o Rigoberto Tiglao (20042006) o Arthur Yap (2006) o Cerge Remonde (20062010) Metropolitan Manila Development Authority Chairman o Benjamin Abalos (20012002) o Bayani Fernando (20022009) o Oscar Inocentes (20092010)

o o o o

[edit] Gallery
[edit] Malacaang Staff

Some of the Malacaang Staff

Alberto Romulo, Executive Secretary (2001-2004)

Eduardo Ermita, Executive Secretary (2004-2010)

Ignacio Bunye, Press Secretary (2004-2008)

Mike Defensor, Chief of Staff (2006-2007)

Joey Salceda, Chief of Staff (2007)

Arthur Yap, Head of the Presidential Management Staff (2006)

Raul M. Gonzalez, Chief Presidential Legal Counsel (2009-2010)

[edit] Domestic

Some of the Cabinet Members and Advisors for Domestic Affairs

Arthur Yap, Secretary of Agriculture (2004-2005; 2006-2009)

Raul Roco, Secretary of Education (2001-2002)

Jesli Lapus, Secretary of Education (2006-2010)

Esperanza Cabral, Secretary of Health (2009-2010)

Bayani Fernando, Secretary of Public Works and Highways (2003) and Chairman of the Metropolitan Manila Development Authority (2002-2009)

Hermogenes E. Ebdane, Jr., Secretary of Public Works and Highways (2007-2009)

Mike Defensor, Chairman of Housing and Urban Development Coordinating Council (2001-2004)

Noli de Castro, Chairman of Housing and Urban Development Coordinating Council (2004-2010)

Leila De Lima, Chairperson of the Commission on Human Rights (2008-2010)

Gilbert Teodoro, Chairman of the National Disaster Coordinating Council (2007-2009)

Benjamin Abalos, Chairman of the Metropolitan Manila Development Authority (20012002) and Chairman of the Commission on Elections (2002-2007)

Resurreccion Borra, Acting Chairman of the Commission on Elections (2007-2008)

[edit] Economic

Some of the Cabinet Members and Advisors for Economic Affairs

Romulo Neri, Secretary of Budget and Management (2005-2006) and Director-General of the National Economic and Development Authority (2001-2005, 2006-2008)

Alberto Romulo, Secretary of Finance (2001)

Margarito Teves, Secretary of Finance (2005-2010)

Richard Gordon, Secretary of Tourism (2001-2004)

Mar Roxas, Secretary of Trade and Industry (2001-2003)

Augusto Santos, Director-General of the National Economic and Development Authority (2005-2006; 2007-2008)

Ralph Recto, Director-General of the National Economic and Development Authority (2008-2009)

Rafael Buenaventura, Governor of the Central Bank (2001-2005)

[edit] Environment and Energy

Some of the Cabinet Members and Advisors for Environment and Energy

Angelo Reyes, Secretary of Environment and Natural Resources (2006-2007) and Secretary of Energy (2007-2010)

Mike Defensor, Secretary of Environment and Natural Resources (2004-2006)

Lito Atienza, Secretary of Environment and Natural Resources (2007-2009)

[edit] Foreign Affairs and National Security

Some of the Cabinet Members and Advisors for Foreign Affairs and National Security

Gloria Macapagal-Arroyo, Acting Secretary of Foreign Affairs (2001, 2002)

Teofisto Guingona, Jr., Secretary of Foreign Affairs (2001-2002)

Blas Ople, Secretary of Foreign Affairs (2002-2003)

Alberto Romulo, Secretary of Foreign Affairs (2004-2010)

Raul Gonzalez, Secretary of Justice (2004-2009)

Agnes Devanadera, Secretary of Justice (2009-2010)

Orly Mercado, Secretary of National Defense (2001)

Angelo Reyes, Secretary of National Defense (2001-2003) and Secretary of Interior and Local Government Secretary (2004-2006)

Eduardo Ermita, Secretary of National Defense (2003-2004)

Hermogenes E. Ebdane, Jr., Secretary of National Defense (2007)

Gilbert Teodoro, Secretary of National Defense (2007-2009)

Hilario Davide, Jr., Ambassador to the United Nations (2007-2010)

Roilo Golez, National Security Adviser (2001-2004)

Norberto Gonzales, National Security Adviser (2004-2010) and Secretary of National Defense (2007, 2009-2010)

[edit] Supreme Court Appointments

Arroyo nominated the following to the Supreme Court of the Philippines:

Artemio Panganiban - Chief Justice, 2005 (an associate justice since 1995) Reynato Puno - Chief Justice, 2006 (an associate justice since 1993) Renato C. Corona - Chief Justice, 2010 (an associate justice since 2002) Antonio T. Carpio - 2001 Conchita Carpio-Morales - 2002 Presbitero J. Velasco, Jr. - 2006 Antonio Eduardo B. Nachura - 2007 Teresita Leonardo-de Castro - 2007 Arturo D. Brion - 2008 Diosdado M. Peralta - 2009 Lucas P. Bersamin - 2009 Mariano C. del Castillo - 2009 Roberto A. Abad - 2009 Martin S. Villarama, Jr. - 2009 Jose P. Perez - 2009 Jose C. Mendoza - 2010

[edit] First Term (2001-2004)

[edit] Succession

Gloria Macapagal-Arroyo being sworn in as president by Chief Justice Hilario Davide Jr. in January 2001. Main articles: EDSA II and EDSA III

Arroyo's ascent to the Philippine presidency in 2001 is mired in controversy as much as the ouster Gloria Arroyo[2], January 20, 2001 of her predecessor with which it is intertwined. On January 20, 2001, after days of political turmoil and popular revolt, the Supreme Court declared the presidency vacant. The military and the national police had earlier withdrawn their support for Estrada. At noon, Arroyo was sworn in as President of the Philippines by Chief Justice Hilario Davide, Jr.[3] Coincidentally, Arroyo assumed office the same day as US President George W. Bush. While the local media and its proponents hailed EDSA II as another peaceful "People Power," international views expressed through foreign media described it as a "conspiracy" to oust Estrada and install Arroyo as president. The New York Times reported that Southeast Asia-based political economist William Overholt called it a "either being called mob rule or mob rule as a cover for a well- planned coup."[4] The International Herald Tribune reports how the "opportunist coalition of church, business elite and left... orchestrated the 'People Power II movement."' [5] On Arroyo's proclamation as President, Former Singaporean Prime Minister Lee Kuan Yew opined that there is "an assumption of power here which isn't in the constitution."[6] Weeks later, Estrada filed a lawsuit challenging the legal basis of the Arroyo presidency and insisting he remained the lawful president, though adding he would not try to reclaim his post.[7] The Supreme Court issued its decision on March 2, 2001, asserting that Estrada had resigned the presidency and relinquished his post.[3] The court unanimously voted to dismiss Estrada's petition, reaffirming the legitimacy of Arroyo's presidency.[3] On May 1, 2001, a week after Estrada was arrested on charges of plunder, an estimated 3,000,000[8] protesters sympathetic to Estrada degenerated into violence and attempted to storm the presidential palace to force Arroyo from office.[9] Four people died, including two policemen, and more than 100 were wounded in clashes between security forces and rioters.[9][10] After being dispersed the crowd had looted stores and burned cars.[9] Arroyo declared a 'state of rebellion' in Manila and ordered the arrests of opposition leaders who led the uprising and conspired to topple the government.[9] The state of rebellion was lifted one week later, with Arroyo declaring "the disorder has subsided".[10]

Join me therefore as we begin to tear down the walls that divide. Let us build an edifice of peace, progress, and economic stability.

Support for the opposition and Estrada subsequently dwindled after the victory of administration allied candidates in the midterm elections that was held later that month. Arroyo outlined her vision for the country as "building a strong republic" throughout her tenure. Her agenda consists of building up a strong bureaucracy, lowering crime rates, increasing tax collection, improving economic growth, and intensifying counter-terrorism efforts.

[edit] 2001 Midterm Elections

Main article: Philippine general election, 2001

The 2001 legislative elections and local elections were held in the Philippines on May 14, 2001 four months after Arroyo took office. Independent senatorial candidate Noli de Castro, a former television anchor of TV Patrol of ABS-CBN was announced as the topnotcher. This is the first synchronized national and local elections held after the ouster of Former President Joseph Estrada in January due to a military-backed civilian uprising (popularly known as EDSA II). On February 20, 2007, the Supreme Court of the Philippines ruled that Former Senator Gregorio Honasan lost in the 2001 Philippine elections and lost to Sen. Ralph Recto but declared constitutional the special election for the remaining three-year term of Teofisto Guingona.

[edit] Oakwood mutiny

Main article: Oakwood mutiny

The Oakwood mutiny occurred in the Philippines on July 27, 2003. A group of 321 armed soldiers who called themselves "Bagong Katipuneros"[11] led by Army Capt. Gerardo Gambala and Lt. Antonio Trillanes IV of the Philippine Navy took over the Oakwood Premier Ayala Center (now Ascott Makati) serviced apartment tower in Makati City to show the Filipino people the alleged corruption of the Gloria Macapagal-Arroyo administration. They also stated that they saw signs suggesting that the President was going to declare martial law.

[edit] 2004 Presidential Election

Although the Philippine Constitution bars a president from reelection, it allows for the election of a person who has succeeded as president and has served for not more than four years.[12] In December 2002, Arroyo made the surprise announcement that she would not seek a new term in the Philippine general election, 2004.[13] Ten months later, however, she reversed her position and declared her intention to seek a direct mandate from the people, saying "there is a higher cause to change society... in a way that nourishes our future".[14] Arroyo faced a tough election campaign in early 2004 against Estrada friend and popular actor Fernando Poe, Jr., senator and former police general Panfilo Lacson, former senator Raul Roco, and Christian evangelist Eddie Villanueva. Her campaign platform centered on a shift to a parliamentary and federal form of government, job creation, universal health insurance, antiillegal drugs, and anti-terrorism.[13]

Arroyo lagged behind Poe in the polls prior to the campaign season, but her popularity steadily climbed to surpass Poe's.[15] As predicted by pre-election surveys and exit polls, she won the election by a margin of over a million votes against her closest rival, Fernando Poe, Jr.[16]

[edit] Second Term (2004-2010)

[edit] Inauguration

Arroyo taking her Oath of Office in Cebu City on June 30, 2004.

Arroyo took her oath of office on June 30, 2004. In a break with tradition, she chose to first deliver her inaugural address at the Quirino Grandstand in Manila before departing to Cebu City for her oath taking: the first time a Philippine president had taken the oath of office outside of Luzon.[13]

[edit] State of Emergency

Main article: 2006 state of emergency in the Philippines

On Friday, February 24, 2006, an alleged coup d'tat plot was uncovered in the Philippines, headed by Brig. Gen. Danilo Lim. The declaration of Proclamation No. 1017 gave Gloria Macapagal-Arroyo the power to issue warrantless (and until then unconstitutional) arrests and to take over private institutions that run public utilities. The President, through the Department of Education, suspended classes in elementary and high school levels. In response, colleges and universities suspended classes. By virtue of PP 1017, she declared a State of Emergency for the whole country in an attempt to quell rebellion as her grip on power began to slip, to stop lawless violence and promote peace and stability. The government's first move after the declaration was to disperse demonstrators, particularly the groups picketing along EDSA. Former Philippine president Corazon Aquino was among those

that protested, along with leftist and extreme right activists. A number of public figures were reported to have been arrested. After the foiling of the plot and the dispersal of the rallies, PP 1017 continued for a week on threats of military plots (such as the military stand-off of February 26 at Fort Bonifacio headed by Col. Ariel Querubin), violence, illegal rallies and public disturbance. Six leftist representatives - Satur Ocampo, Teodoro Casio, and Joel Virador of Bayan Muna, Liza Maza of GABRIELA, and Crispin Beltran and Rafael Mariano of Anakpawis - were charged with rebellion. Crispin Beltran of Anakpawis was arrested on February 25 on charges of inciting to sedition and rebellion. To avoid further arrest, the other five found shelter at the Batasang Pambansa Complex. On Saturday, February 25, the office of the Daily Tribune, a newspaper known as a hard-hitting critic of the Arroyo administration, was raided. After the raid, an issuance of Journalism Guideline followed, authored by the government in order to cope with the "present abnormal situation", according to then Chief of Staff Michael Defensor. The move to suppress freedom of the press against the Daily Tribune was criticized by Reporters Without Borders.[17] The decree was lifted on March 3, 2006. However the opposition, lawyers, and concerned citizens filed a complaint in the Supreme Court contesting the constitutionality of PP 1017. The court, on May 4, declared the proclamation constitutional, but said it was illegal to issue warrantless arrests and seize private institutions.

[edit] 2007 Midterm Elections

Main article: Philippine general election, 2007

Legislative and local elections were held in the Philippines on May 14, 2007. Positions contested included half the seats in the Senate, which are elected for six-year terms, and all the seats in the House of Representatives, who were elected for three-year terms. The duly elected legislators of the 2007 elections joined the elected senators of the 2004 elections to comprise the 14th Congress of the Philippines. Most representatives won seats by being elected directly, the constituency being a geographical district of about 250,000 voters. There are 220 seats in total for all the legislative districts. Some representatives were elected under a party-list system. Only parties representing marginalized groups were allowed to run in the party-list election. To gain one seat, a party must win 2% of the vote. No party-list party may have more than 3 seats. After the election, in a controversial decision, the Commission on Elections (COMELEC) changed how it allocates the party-list seats. Under the new formula only one party will have the maximum 3 seats. It based its decision on a formula contained in a Supreme Court decision. Local elections for governor, vice governor, provincial board seats and mayoral, vice mayoral and city/municipal council seats in Metro Manila and the provinces are up for grabs as well.

Arroyo's coalition won 3 senate seats and 123 seats in the house.

[edit] The Manila Peninsula Rebellion

Main article: Manila Peninsula rebellion

The Peninsula Manila Rebellion was a rebellion in the Philippines on November 29, 2007. Detained Senator Antonio Trillanes IV, General Lim and other Magdalo (mutineers) officials walked out of their trial and marched through the streets of Makati City, called for the ouster of President Gloria Macapagal-Arroyo, and seized the second floor of The Peninsula Manila Hotel along Ayala Avenue. Former Vice-President Teofisto Guingona also joined the march to the hotel. Sen. Antonio Trillanes IV and Brigadier Gen. Danilo Lim surrendered to authorities after an armored personnel carrier rammed into the lobby of the hotel.[18] Director Geary Barias declared that the standoff at the Manila Peninsula Hotel is over as Sen. Antonio Trillanes IV, Brig. Gen. Danilo Lim along with other junior officers agreed to leave the hotel and surrender to Barias after the 6 hour siege.[19] There was difficulty getting out for a while due to the tear gas that was covering the area where they were hiding. Days after the mutiny, the Makati City Regional Trial Court dismissed the rebellion charges against all the 14 civilians involved in the siege, and ordered their release.

[edit] Impeachment complaints

In 2005, 2006, 2007 and 2008, impeachment complaints were filed against President Arroyo although none of the cases reached the required endorsement of 1/3 of the members for transmittal to and trial by the Senate. On October 13, 2008, the 4th 97-page impeachment complaint against President Arroyo was filed at the House of Representatives of the Philippines with the required endorsements by Party list Representatives Satur Ocampo, Teodoro Casio and Liza Maza. The complaint accuses Arroyo of corruption, extrajudicial killings, torture and illegal arrests. The impeachment further raised the issues on "national broadband network agreement with China, human rights violations, the Northrail project, the Mt. Diwalwal project, fertilizer fund scam, alleged bribery of members of the House, the swine scam under the Rural Credit Guarantee Corporation, and 2004 electoral fraud." The opposition complainants were Edita Burgos, Iloilo Vice Governor Rolex Suplico, Jose de Venecia III, Harry Roque, Armando Albarillo, a human rights victim, Roneo Clamor, Karapatan deputy secretary general, Josefina Lichauco, and representatives from civil society Renato Constantino, Jr., Henri Kahn, Francisco Alcuaz, Rez Cortez, Virgilio Eustaquio, Jose Luis Alcuaz, Leah Navarro, Danilo Ramos, Concepcion Empeo, Elmer Labog, Armando Albarillo, Roneo Clamor, and Bebu Bulchand. The justice committee has 60 days to rule upon the complaint's sufficiency in form and substance. However, the opposition has only 28 House seats.[20][21][22][23][24]

Under Sections 2 and 3, Article XI, Constitution of the Philippines, the House of Representatives of the Philippines has the exclusive power to initiate all cases of impeachment against, the President, Vice President, members of the Supreme Court, members of the Constitutional Commissions (Commission on Elections, Commission on Audit), and the Ombudsman. When a third of its membership has endorsed the impeachment articles, it is then transmitted to the Senate of the Philippines which tries and decide, as impeachment tribunal, on the impeachment case.[25]

[edit] Estrada pardon

On October 25, 2007, Arroyo granted a pardon to Joseph Estrada, supposedly based on the recommendation by the Department of Justice. Press Secretary Ignacio Bunye quoted the signed Order: "In view hereof in pursuant of the authority conferred upon me by the Constitution, I hereby grant Executive clemency to Joseph Ejercito Estrada, convicted by the Sandiganbayan of plunder and imposed a penalty of reclusion perpetua. He is hereby restored to his civil and political rights." Bunye noted that Estrada committed in his application not to seek public office, and he would be free from his Tanay resthouse on October 26, noon.[26][27][28] Accordingly, Justice Secretary Raul Gonzales categorically stated in 2008 that an Estrada plan to run for president in the scheduled 2010 elections is unconstitutional. Estrada, however, disagrees, saying that he is eligible to run for president again, based on the legal advice he gets from former Supreme Court Chief Justice Andres Narvasa.[29]

[edit] Martial Law

Main article: Maguindanao massacre

In the wake of the massacre of 57 people in Ampatuan town, President Arroyo placed Maguindanao under a state of martial law, Executive Secretary Eduardo Ermita announced on the morning of December 5, 2009. In so doing, Malacaang has suspended the writ of habeas corpus in the province except "for certain areas," enabling the military to make arrests without court intervention. This constitutes the first declaration of martial law in the Philippines since 1972, when then-president Ferdinand Marcos imposed military rule over the entire country.[30][31]

[edit] Congressional bid in Pampanga

Main article: Philippine House of Representatives elections, 2010

On November 30, 2009, after much speculation, President Arroyo announced on the Philippine Broadcasting Service her congressional bid for the second district of Pampanga.[32] On December 1, 2009, she filed her candidacy under the Lakas-Kampi-CMD.[33]

[edit] Domestic policies

[edit] Economy

President Arroyo, President Bush and other state leaders at the 2004 APEC Trade Summit

Arroyo, a practicing economist, has made the economy the focus of her presidency. Based on official (National Economic and Development Authority) figures, economic growth in terms of gross domestic product has averaged 5.0% during the Arroyo presidency from 2001 up to the first quarter of 2008.[34] This is higher than in the administration of the previous recent presidents: 3.8% average of Aquino, 3.7% average of Ramos, and 3.7%[35] average of the Joseph Estrada administration. The Philippine economy grew at its fastest pace in three decades in 2007, with real GDP growth exceeding 7%.[36] Arroyo's handling of the economy has earned praise from former "friend" and classmate in Georgetown, ex-US President Bill Clinton, who cited her "tough decisions" that put the Philippine economy back in shape.[37] Whether the official economic figures are accurate, or how they translate to improving lives of the citizens, however, is debatable. Studies made by the United Nations (UN) and local survey research firms show worsening, instead of improving, poverty levels. A comparative 2008 UN report shows that the Philippines lags behind its Asian neighbors, Indonesia, Thailand, Vietnam and China, in terms of poverty amelioration. The study reveals that from 2003 up to 2006, the number of poor Filipinos increased by 3.8 million, with poverty incidence being approximately three times higher in agricultural communities.[38] With regards the problem of hunger, quarterly studies by the social polling research firm Social Weather Stations show that the number of Filipino households suffering from hunger has significantly increased during Arroyo's presidency. Her administration first set the record for hunger levels in March 2001, and beginning June 2004, broke the record again seven times. December 2008 figures saw the new record high of 23.7%, or approximately 4.3 million households, of Filipino families experiencing involuntary hunger.[39] A controversial expanded value added tax (e-VAT) law, considered the centerpiece of the Arroyo administration's economic reform agenda,[40] was implemented in November 2005, aiming to complement revenue-raising efforts that could plug the country's large budget deficit. The country aims to balance the national budget by 2010. The tax measure boosted confidence in the government's fiscal capacity and helped to strengthen the Philippine peso, making it East Asia's best performing currency in 2005-06.[41] The peso strengthened by nearly 20% in 2007, making it by far Asia's best performing currency for the year, a fact attributed to a combination of increased remittances from overseas Filipino workers and a strong domestic economy.[42]

Annual inflation reached the 17-year high of 12.5 percent in August 2008, up from a record low of 2.8 percent registered in 2007. It eased to 8.8 percent in December 2008 as fuel and energy prices went down.[43] The managing director of the World Bank, Juan Jose Daboub, criticized the administration for not doing enough to curb corruption.[44][45] Early in her presidency, Arroyo implemented a controversial policy of holiday economics, adjusting holidays to form longer weekends with the purpose of boosting domestic tourism and allowing Filipinos more time with their families.[46]

[edit] Charter change

In 2005, Arroyo initiated a movement for an overhaul of the constitution to transform the present presidential-bicameral republic into a federal parliamentary-unicameral form of government.[47] At her 2005 State of the Nation Address, she claimed "The system clearly needs fundamental change, and the sooner the better. It's time to start the great debate on Charter Change".[48] In late 2006, the House of Representatives shelved a plan to revise the constitution through constituent assembly.[49]

[edit] Executive Order No. 464 and calibrated preemptive response

In late September 2005, Arroyo issued an executive order stating that demonstrations without permits would be pre-emptively stopped. Then members of the military testified in Congressional hearings that they were defying a direct order not to testify about their knowledge of the election scandal. There is the issuance of Executive Order No. 464 forbidding government officials under the executive department from appearing in congressional inquiries without President Arroyo's prior consent.[50] These measures were challenged before the Supreme Court, which apparently declared some sections as unconstitutional.

[edit] Human rights

The neutrality of this section is disputed. Please see the discussion on the talk page. Please do not remove this message until the dispute is resolved. (December 2007)

A May 2006 Amnesty International report expressed concern over the sharp rise in vigilante killings of militant activists and community workers in the Philippines.[51] Task Force Usig, a special police unit tasked to probe reported extra-judicial killings, by state run death squads counts 115 murders and says most of these are the result of an internal purge by communist rebels.[52] Human rights groups put the number as high as 830. These violations were alleged to have been committed against left-leaning organizations and party-list groups including BAYAN, Bayan Muna and Anakpawis. These organizations accuse the Philippine National Police and Armed Forces of the Philippines for the deaths of these

political opponents. Arroyo has condemned political killings "in the harshest possible terms" and urged witnesses to come forward. "The report, which Melo submitted to Arroyo last month, reportedly linked state security forces to the murder of militants and recommended that military officials, notably retired major general Jovito Palparan, be held liable under the principle of command responsibility for killings in their areas of assignment."[53][54] [55] [56] [57] General Palparan who retired September 11, 2006 has been appointed by President Arroyo to be part of the Security Council. This has alarmed left-leaning political parties about the potential for human rights violations.[58] An independent commission was assembled in August 2006 to investigate the killings. Headed by former Supreme Court Justice Jose Melo, the group known as the Melo Commission concluded that most of the killings were instigated by the Armed Forces of the Philippines, but found no proof linking the murder of activists to a "national policy" as claimed by the left-wing groups. On the other hand the report "linked state security forces to the murder of militants and recommended that military officials, notably retired major general Jovito Palparan, be held liable under the principle of command responsibility for killings in their areas of assignment."[52] Stricter anti-terror laws have also caused some concern in recent years. Under Arroyo's government, the Philippines has become second only to Iraq as the world's riskiest place to report the news, with 23 journalists killed since 2003[59] In her July 23, 2007 State of the Nation Address, Arroyo has set out her agenda for her last three years in office, and called for legislation to deal with a spate of political killings that have brought international criticism to her presidency. She promised to bring peace to the troubled south, and also defended a controversial new anti-terrorism legislation. Arroyo told the joint session of Congress that "I would rather be right than popular."[60] Lawmakers and lawyers, however, were dismayed by the SONA's failure to highlight and address this major hindrance to human rights. Specifically, the Alternative Law Groups (ALG) echoed the lawmakers position that Mrs Arroyo failed to take responsibility for the problem.[61] In 2007, incidences of extrajudicial killings dropped 87%, with the decline attributed to the creation of a special task force to handle the killings.[62]

Gloria Macapagal-Arroyo visited by United States Marines.

[edit] Amnesty proclamation

On September 5, 2007, President Gloria Macapagal-Arroyo signed Amnesty Proclamation 1377 for members of the Communist Party of the Philippines and its armed wing, the New People's Army; other communist rebel groups; and their umbrella organization, the National Democratic Front. The amnesty will cover the crime of rebellion and all other crimes "in pursuit of political beliefs," but not including crimes against chastity, rape, torture, kidnapping for ransom, use and trafficking of illegal drugs and other crimes for personal ends and violations of international law or convention and protocols "even if alleged to have been committed in pursuit of political beliefs." The National Committee on Social Integration (NCSI) will issue a Certificate of Amnesty to qualified applicants. Implementing rules and regulations are being drafted and the decree will be submitted to the Senate of the Philippines and the House of Representatives for their concurrence. The proclamation becomes effective only after Congress has concurred.[63]

[edit] Foreign Policies

See also: International trips made by Gloria Macapagal-Arroyo

[edit] Iraq War

Main article: Iraq War

The Arroyo administration has forged a strong relationship with the United States. Arroyo was one of the first world leaders who expressed support for the US-led coalition against global terrorism in the aftermath of the September 11, 2001 attacks, and remains one of its closest allies in the war on terror.[64] Following the US-led invasion of Iraq, in July 2003 the Philippines sent a small humanitarian contingent which included medics and engineers. These troops were recalled in July 2004 in response to the kidnapping of Filipino truck driver Angelo de la Cruz.[64] With the hostage takers demands met, the hostage was released.[64] The force was previously due to leave Iraq the following month.[64] The early pullout drew international condemnation, with the United States protesting against the action, saying giving in to terrorist demands should not be an option.[64]

[edit] ASEAN Summit

Arroyo's foreign policy is anchored on building strong ties with the United States, East Asian and Southeast Asian nations, and countries where overseas Filipino workers work and live.[65] In 2007, the Philippines was host to the 12th ASEAN Summit in Cebu City.

[edit] Philippines-Japan Trade Deal

On August 21, 2007, Arroyo's administration asked the Senate of the Philippines to ratify a $4 billion (2 billion) trade deal with Japan (signed on 2006 with the former Japanese prime minister Junichiro Koizumi), which would create more than 300,000 jobs (by specifically increasing local exports such as shrimp to Japan). Japan also promised to hire at least 1,000 Philippine nurses. The opposition-dominated senate objected on the ground that toxic wastes would be sent to the Philippines; the government denied this due to the diplomatic notes which stated that it would not be accepting Japanese waste in exchange for economic concessions.[66]

[edit] Council of Women World Leaders

In keeping with this international mission, President Gloria Macapagal-Arroyo is a member of the Council of Women World Leaders, an International network of current and former women presidents and prime ministers whose mission is to mobilize the highest-level women leaders globally for collective action on issues of critical importance to women and equitable development.

Arroyo with World Leaders

Proceeding from public ceremony to private talks, Philippine President Gloria Macapagal-Arroyo and President George W. Bush meet in the Oval Office Monday, May 19, 2003.

President Barack Obama jokes with Philippine President Gloria Macapagal-Arroyo before a news conference in the Oval Office on July 30, 2009.

President Gloria Macapagal Arroyo with Russian President Vladimir Putin during a meeting of the APEC leaders

President Arroyo with Russian president Dmitry Medvedev during her visit in Moscow, Russia for St. Petersburg International Economic Forum, June 46, 2009

President Gloria Macapagal-Arroyo and U.S Secretary of State Condoleezza Rice

Secretary of State Hillary Clinton held a bilateral meeting with Philippine President Gloria Macapagal-Arroyo

Defense Secretary Donald H. Rumsfeld and Republic of the Philippines President Gloria Macapagal-Arroyo meet the press Nov. 20 outside the Pentagon. Macapagal-Arroyo is in Washington to meet with President Bush and other senior U.S. government officials.

U.S. Defense Secretary Robert M. Gates, right, escorts Philippine President Gloria Arroyo through an honor cordon into the Pentagon for a meeting, June 24, 2008.

[edit] Pardons

President Gloria Macapagal Arroyo granted pardon the following:

Former President Joseph Estrada (2007) - convicted of plunder Pablo Martnez (2007) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Claudio Teehankee, Jr. (2008) - convicted of murder Rogelio Moreno (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Rubn Aquino (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Arnulfo Artates (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Romeo Bautista (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Jess Castro (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Arnulfo De Mesa (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Rodolfo Desolong (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Claro Lat (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Ernesto Mateo (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Filomeno Miranda (2009) - convicted for being involved in the Assassination of Benigno Aquino, Jr. Former Congressman Romeo Jalosjos (2009) - convicted of rape

[edit] Controversies
[edit] Fertilizer Fund Scam
Main article: Fertilizer Fund Scam

The Fertilizer Fund Scam is a Philippine political controversy involving accusations that Agriculture Undersecretary Jocelyn Bolante diverted P728 million in fertilizer funds to the 2004 election campaign of President Gloria Macapagal-Arroyo.

[edit] Hello Garci Controversy

The neutrality of this section is disputed. Please see the discussion on the talk page. Please do not remove this message until the dispute is resolved. (December 2007) Main article: Hello Garci scandal

In the middle of 2005, Samuel Ong who is a former deputy director of the country's National Bureau of Investigation (NBI) claimed to have audio tapes of wiretapped conversations between President Arroyo and an official of the Commission on Elections. According to Ong, the contents of the tape prove that the 2004 national election was rigged by Arroyo in order to win by around one million votes. On June 27, Arroyo admitted to inappropriately speaking to a Comelec official, claiming it was a "lapse in judgement", but denied influencing the outcome of the election. Attempts to impeach Arroyo failed later that year.

Two witnesses, Antonio Rasalan and Clinton Colcol, stepped forward in August 2006, claiming involvement in an alleged plot to alter the results for the May 2004 elections. Rasalan claimed that he was fully convinced that the election returns presented at the House of Representatives were manufactured and had replaced the original documents. Colcol, a tabulator for the Commission on Elections (Comelec), said that Arroyo only received 1,445 votes, while Poe received 2,141 in South Upi, Maguindanao during the May 2004 elections.[67][68] On January 25, 2008, Pulse Asia survey (commissioned by Genuine Opposition (GO) per former Senator Sergio Osmea III) stated that 58% percent of Filipinos in Mindanao believed that President Gloria Macapagal-Arroyo cheated in the Philippine general election, 2004. 70% also "believed that because of recurring allegations of election fraud, the credibility of the balloting process in Mindanao was at a record low."[69]

[edit] National Broadband Network Scandal

The neutrality of this section is disputed. Please see the discussion on the talk page. Please do not remove this message until the dispute is resolved. (March 2008) Main article: Philippine National Broadband Network controversy

The Philippine National Broadband Network controversy is a political affair that centers upon allegations of corruption primarily involving Former Commission on Elections (COMELEC) Chairman Benjamin Abalos, First Gentleman Mike Arroyo and President Gloria MacapagalArroyo regarding the proposed government-managed National Broadband Network (NBN) for the Philippines and the awarding of its construction to the Chinese firm Zhong Xing Telecommunication Equipment Company Limited (ZTE), a telecommunications and networking equipment provider. The issue has captivated Filipino politics since it erupted in Philippine media around August 2007, largely through the articles of newspaper columnist Jarius Bondoc of the Philippine Star. It has also taken an interesting turn of events, including the resignation of Abalos as COMELEC chairman, the alleged bribery of congressmen and provincial governors (dubbed as "Bribery in the Palace"), the unseating of Jose de Venecia, Jr. as House Speaker, and the alleged "kidnapping" of designated National Economic and Development Authority (NEDA) consultantturned-NBN/ZTE witness Rodolfo Noel "Jun" Lozada, Jr.

[edit] Controversial Dinner party and Ondoy

Again, a serious blow marked an another controversy in the Philippines. In July 2009, Arroyo went to New York City to dine with her friends at a lush Le Cirque restaurant and was highly criticized for her supposed outlandish dinner at Le Cirque with the Philippine delegation during her visit to the United States. President Arroyo and her group reportedly had dinner for the cost of $20,000 or P1,000,000 as reported in the New York Post. This has been linked to corruption and anti-Gloria protests to sprawl anger among the poor, and more people went hungry as a

result of rising hunger, and also, anti-Gloria coup attempts. In September 2009, Typhoon Ondoy became devastative throughout Metro Manila and Luzon leaving 464 people dead and resulted to massive flooding and landslides. After Benigno Aquino III took office on June 30, 2010, he criticized Arroyo and PAGASA for lack of disaster preparedness and new equipment in the aftermath of Ondoy, Chief Administrator Prisco Nilo was fired and resigned for having a foolproof forecast as the typhoon struck the metropolis.

[edit] Northrail Controversy

The Northrail project is being surrounded by a controversy since 1997, Arroyo signed a Memorandum of agreement with Sinomach and other contractors in 2004, to construct a rail line from Caloocan to Clark Special Economic Zone once to be completed in 2010. Many opposition senators and congressmen opposed that the project could cost US$500 million and this has been led to corruption in the Arroyo cabinet and even her, and also a series of cancellations. After it was constructed from 2009-2010, again, it eventually cancelled in March 2011, no plans and substitute foreign support (Japan for example) to continue the project.

[edit] End of Presidency

In November 2009, Arroyo formally declared her intention to run for a seat in the House of Representatives representing the 2nd District of Pampanga, making her the second Philippine President - after Jose P. Laurel - to pursue a lower office after the expiration of their presidency.[70] A petition seeking to disqualify Arroyo from the race was dismissed by the Comelec for lack of merit, a decision which was later affirmed by the Supreme Court.[71] With little serious competition, she was elected to congress in May 2010 with a landslide victory.[72] After receiving final military honors at the inauguration ceremony of incoming President Benigno Aquino III, she headed straight to Pampanga for her own oath-taking as congresswoman.[73]

[edit] References
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32. ^ "Arroyo to run for Congress". Philippine Daily Inquirer. 2009-11-30. http://politics.inquirer.net/view.php?db=1&article=20091130-239344. Retrieved 2009-1231.[dead link] 33. ^ "Arroyo now an official bet for Congress". Philippine Daily Inquirer. 2009-12-01. http://newsinfo.inquirer.net/breakingnews/nation/view/20091201-239523/Arroyo-filescandidacy-for-Congress. Retrieved 2009-12-31. 34. ^ Economic Indicators Table, National Economic Development Authority 35. ^ Untitled Document 36. ^ Philippines Economy Profile 2008 37. ^ Arroyo shares spotlight with global leaders in forum - INQUIRER.net, Philippine News for Filipinos 38. ^ Leyco, Chino. "Philippines Trails In Poverty Reduction, Says UN Report." Manila Times. April 03, 2008, Retrieved January 28, 2009. http://www.manilatimes.net/national/2008/apr/03/yehey/top_stories/20080403top2.html[dead
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39. ^ Fourth Quarter 2008 Social Weather Survey: Hunger at new record-high 23.7% of families; Moderate Hunger at 18.5%, Severe Hunger at 5.2%. 2008, December 22.Social Weather Stations Site. Retrieved January 28, 2009. http://www.sws.org.ph/pr081222.htm 40. ^ Arroyo facing a dilemma after voiding of new tax - International Herald Tribune 41. ^ CIA - The World Factbook - Philippines[dead link] 42. ^ "Pacific Newsletter". Archived from the original on 2008-01-17. http://web.archive.org/web/20080117213927/http://www.pacificnewscenter.com/default.asp? sourceid=&smenu=97&twindow=&mad=&sdetail=17246&wpage=1&skeyword=&sidate=&ccat= &ccatm=&restate=&restatus=&reoption=&retype=&repmin=&repmax=&rebed=&rebath=&subn ame=&pform=&sc=1718&hn=pacificnewscenter&he=.com. 43. ^ Ferriols, Des. "December inflation falls to 9-month low of 8%." Retrieved January 28, 2009. http://www.philstar.com/Article.aspx?ArticleId=429620&publicationSubCategoryId=66 44. ^ "WB exec laments RPs slow growth". http://www.globalpinoy.com/news/news_inside.php?newsnum=3090. Retrieved 2008-03-26. 45. ^ "The World Bank smells corruption". http://www.preda.org/archives/research/digest/digest81.html. Retrieved 2008-03-26.[dead link] 46. ^ Calica, Aurea (2007-01-19). "GMA bares list of holidays". ABS-CBN News. http://www.abscbnnews.com/storypage.aspx?StoryId=63646. Retrieved 2007-06-05.[dead link] 47. ^ Dalangin-Fernandez, Lira (2006-07-27). "People's support for Charter change 'nowhere to go but up'". Philippine Daily Inquirer. http://archive.inquirer.net/view.php?db=1&story_id=12106. Retrieved 2006-07-27. 48. ^ "2005 State of the Nation Address". The Official Website of the Republic of the Philippines. 2005-07-25. Archived from the original on 2007-02-09. http://web.archive.org/web/20070209004700/http://www.gov.ph/sona/sonatext2005.asp. Retrieved 2007-06-06. 49. ^ Ubac, Michael Lim (2006-12-12). "Arroyo allies retreat". Philippine Daily Inquirer. http://newsinfo.inquirer.net/inquirerheadlines/nation/view_article.php?article_id=37690. Retrieved 2007-06-06. 50. ^ [1][dead link] 51. ^ "2006 Elections to the Human Rights Council - Background information on candidate countries". Amnesty International. 2006-05-01. http://www.amnesty.org/en/library/info/IOR41/006/2006. Retrieved 2006-09-13.

52. ^ a b Alberto, Thea (2007-02-15). "Melo: Commission report 'complete'". Philippine Daily Inquirer. http://newsinfo.inquirer.net/breakingnews/nation/view_article.php?article_id=49657. Retrieved 2007-06-04. 53. ^ "State of the Nation Address of President Gloria Macapagal-Arroyo". The Official Website of the Republic of the Philippines. 2006-07-24. Archived from the original on 2007-02-27. http://web.archive.org/web/20070227161854/http://www.gov.ph/sona/sonatext2006.asp. Retrieved 2007-06-05. 54. ^ STOP Extra-Judicial Killings in the Philippines 55. ^ PC(USA) News: Graft and corruption 56. ^ Radio Pinoy USA[dead link] 57. ^ Scared Silent: Impunity for Extrajudicial Killings in the Philippines 58. ^ Norman Borbadora; Michael Lim Ubac (2006-09-09). "Reign of terror continues". Philippine Daily Inquirer. http://archive.inquirer.net/view.php?db=1&story_id=20004. Retrieved 2006-0913. 59. ^ A Philippine Shame 60. ^ "Arroyo lays out economic agenda". BBC News. 2007-07-23. http://news.bbc.co.uk/2/hi/asiapacific/6911261.stm. Retrieved 2007-07-23. 61. ^ GMANews.TV - SONA: Prexy's silence on killings hit by lawmakers - Nation - Official Website of GMA News and Public Affairs - Latest Philippine News - BETA 62. ^ "PNP: Extrajudicial killings fell by 83% in 2007". Inquirer.net. 2008-01-14. http://newsinfo.inquirer.net/breakingnews/nation/view/20080114-112184/PNP-Extrajudicialkillings-fell-by-83-in-2007. Retrieved 2009-07-10. 63. ^ Inquirer.net, Arroyo signs amnesty proclamation for communists 64. ^ a b c d e CNN.com - Philippines begins Iraq pullout - July 16, 2004[dead link] 65. ^ Office of the President of the Philippines 66. ^ BBC NEWS, Philippines fight over trade deal 67. ^ Norman Bordadora (2006-08-18). "2 men claim cheating for Arroyo in '04 election". Philippine Daily Inquirer. http://archive.inquirer.net/view.php?db=1&story_id=15880. Retrieved 2006-0913. 68. ^ Senate election results could mean tough time ahead Arroyo - INQUIRER.net, Philippine News for Filipinos 69. ^ GMA NEWS.TV, Most Mindanaoans believe Arroyo cheated in 04 polls - Pulse 70. ^ Dino Maragay (2009-11-30). "GMA gunning for House seat". Philippine Star. http://www.philstar.com/ArticlePrinterFriendly.aspx?articleId=528207. Retrieved July 5, 2010. 71. ^ Edu Punay, Marvin Sy, Delon Porcalla, Ric Sapnu (2010-02-24). "It's final: GMA can run for House seat". Philippine Star. http://www.philstar.com/ArticlePrinterFriendly.aspx?articleId=552457. Retrieved July 5, 2010. 72. ^ "Regional Election Results Tally: PAMPANGA". GMA News and Public Affairs. 2010-05-20. http://www.gmanews.tv/eleksyon2010/provincialcount/PAMPANGA. Retrieved July 2, 2010. 73. ^ Dreo Calonzo (2010-06-30). "Arroyo takes oath of office as Pampanga rep". GMA News and Public Affairs. http://www.gmanews.tv/story/194848/arroyo-takes-oath-as-pampangarepresentative. Retrieved July 5, 2010.

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Office of the President of the Philippines President Gloria Macapagal-Arroyo official website Reporter's Notebook: Ang Palasyo Reporter's Notebook Special, 12/04/2007

Political offices Vice President of the Philippines 19982001 President of the Philippines 20012010 Secretary of Foreign Affairs 2002 Secretary of National Defense 2003 Secretary of Foreign Affairs 2003 Secretary of National Defense 20062007 Party political offices Preceded by Chair of Lakas-CMD Position abolished Succeeded by Teofisto Guingona Succeeded by Benigno Aquino III Succeeded by Blas Ople Succeeded by Eduardo Ermita Succeeded by Delia Albert Succeeded by Hermogenes Ebdane

Preceded by Joseph Estrada

Preceded by Teofisto Guingona Preceded by Angelo Reyes Preceded by Franklin Ebdalin Preceded by Avelino Cruz

Jose de Venecia Preceded by Luis Villafuerte Position established

20042009 Chair emeritus of KAMPI 20042009 Chair of Lakas-Kampi-CMD 2009

[show]v d eGloria MacapagalArroyo

Parties merged into LakasKampi-CMD

Succeeded by Gilberto Teodoro

[show]v d ePresidents of the Philippines

[show]v d eVice Presidents of the Philippines

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