{
  "id": 3599700,
  "title": "Philippines’ growth problem: Is it corruption — or industrial policy?",
  "url": "https://urgent.news/2026/08/26/philippines-growth-problem-is-it-corruption-or-industrial-policy",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-26T21:44:53.000Z",
  "source": {
    "name": "Gulf News",
    "slug": "gulf-news",
    "url": "https://gulfnews.com/opinion/philippines-growth-problem-is-it-corruption-or-industrial-policy-1.500652442"
  },
  "original_language": "en",
  "account": "The Philippines has long grappled with economic underdevelopment, with corruption and weak institutions widely cited as major factors. However, economic historian and University of California-Berkeley professor Lisandro Estrada Claudio argues that there might be a deeper issue at play. Claudio's book, \"The Profligate Colonial: How the US Exported Austerity to the Philippines,\" suggests that the Philippine economic system may not be conducive to actively promoting development.\n\nClaudio challenges the conventional wisdom that corruption is the primary reason for the country's woes. While acknowledging that corruption is indeed a problem, he questions whether the deeper problem lies in the country's industrial policy. He argues that inherited economic systems tend to discourage the state from actively promoting development, which has major implications for industrial policy.\n\nIndustrial policy refers to a government's strategy for deciding what kind of economy it wants to build. Historically, the Philippines' industrial policy has been skewed towards services and workforce development, rather than focusing on building domestic industries and factories. This mindset is reflected in the education system, which emphasizes English and job-ready skills, as well as the creation of institutions like the Department of Migrant Workers. As a result, the Philippines has become exceptionally good at exporting labour and services but less successful at building the industries that can absorb this talent at home.\n\nA government that views fiscal and monetary restraint as almost self-evidently good may be less willing to invest in large-scale projects necessary for industrialization, such as building ports, power systems, railways, industrial parks, research institutions, and technical schools. This austerity mentality, reinforced by American policymakers, may hinder the country's ability to move up the value chain and become more competitive in manufacturing and other strategically important sectors.\n\nIn conclusion, while corruption and weak institutions are undoubtedly part of the problem, Claudio argues that the real issue may be the deeper economic system that has been inherited and promoted industrial policy skewed towards services rather than actively promoting development.",
  "summary": "Manila: For decades, the debate here has often treated corruption as the prime reason for the country's economic woes . The standard explanation goes something like this: weak institutions and a culture of patronage create fertile ground for \"rent-seeking\" — public money gets siphoned into unproductive uses, businesses face political gatekeeping, and investment retreats in the face of uncertainty…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}