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Philippines Economic and Social Developments
The Taft Commission, appointed in 1900, viewed economic
development, along with education and the establishment of
representative institutions, as one of the three pillars of the
United States program of tutelage. Its members had ambitious
plans to build railroads and highways, improve harbor facilities,
open greater markets for Philippine goods through the lowering or
elimination of tariffs, and stimulate foreign investment in
mining, forestry, and cash-crop cultivation. In 1901 some 93
percent of the islands' total land area was public land, and it
was hoped that a portion of this area could be sold to American
investors. Those plans were frustrated, however, by powerful
agricultural interests in the United States Congress who feared
competition from Philippine sugar, coconut oil, tobacco, and
other exports. Although Taft argued for more liberal terms, the
United States Congress, in the 1902 Land Act, set a limit of 16
hectares of Philippine public land to be sold or leased to
American individuals and 1,024 hectares to American corporations.
This act and tight financial markets in the United States
discouraged the development of large-scale, foreign-owned
plantations such as were being established in British Malaya, the
Dutch East Indies, and French Indochina.
The Taft Commission argued that tariff relief was essential
if the islands were to be developed. In August 1909, Congress
passed the Payne Aldrich Tariff Act, which provided for free
entry to the United States of all Philippine products except
rice, sugar, and tobacco. Rice imports were subjected to regular
tariffs, and quotas were established for sugar and tobacco. In
1913 the Underwood Tariff Act removed all restrictions. The
principal result of these acts was to make the islands
increasingly dependent on American markets; between 1914 and
1920, the portion of Philippine exports going to the United
States rose from 50 to 70 percent. By 1939 it had reached 85
percent, and 65 percent of imports came from the United States.
In 1931 there were between 80,000 and 100,000 Chinese in the
islands active in the local economy; many of them had arrived
after United States rule had been established. Some 16,000
Japanese were concentrated largely in the Mindanao province of
Davao (the incorporated city of Davao was labeled by local
boosters the "Little Tokyo of the South") and were predominant in
the abaca industry. Yet the immigration of foreign laborers never
reached a volume sufficient to threaten indigenous control of the
economy or the traditional social structure as it did in British
Malaya and Burma.
Data as of June 1991
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