8/11/2019 STS 2014

1/30

National Industrialization

for Science and Technology Development

Dr. Giovanni Tapang

Associate Professor, National Institute of PhysicsUniversity of the Philippines Diliman

STS 2014

8/11/2019 STS 2014

2/30

Walkthrough

Introduction

Science and technology in the Philippines

National industrial policy

Critical innovation for national industrialization

8/11/2019 STS 2014

3/30

8/11/2019 STS 2014

4/30

Philippine poverty

and backwardness Widespread poverty

1 out of 4 (NSCB 27.9 %, < P7,821/mo)

Worsening inequality

Agricultural and industrial

backwardness

Overly reliant on cheap labor

export (OFW), foreign capital

and debt

8/11/2019 STS 2014

5/30

2012 data: Agri 12.3%, Industry 33.3 %, Services 54.4% (2011 est) Feb 2013 data: Agri 12.4 %, Industry 31.3%, Services 56.4 % (2012 est)

De-industrialization and shrinking manufacturing: As small as in 1950s Falling food production per capita, rising agricultural trade deficits

8/11/2019 STS 2014

6/30

SWS survey (1Q 2013):25.4% unemployment Around 10.6 million

unemployed (IBON) + 5million (due to Yolanda)

47.2%-49 % in the 18-24age range, 30.2% -32.9

% for 25-34 (Dec 2012SWS)

Overseas Remittances,

1980-2009 (US$ million, % of GDP)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008

Year

US$million,current

0

2

4

6

8

10

12

%o

fGDP

OFWremittances (US$million)

As percentageofGDP (%)

8/11/2019 STS 2014

7/30

8/11/2019 STS 2014

8/30

Weak Manufacturing Manufacturing industry has been weak, growth has been slowand

contribution to value added and employment has been limited.

..Industrial structure remained hollow or missing in middle andmedium enterprises... never seriously challenged the large

entrenched incumbents.

Linkagesbetween SMEs and large enterprises [remain] limited

Heavy concentration of Philippine exports on three majorproducts groups: electronics, garments and textiles and auto parts

Within these major product groups, exports are highly concentratedin low value added and labor-intensive productssectors.

Twenty Years after Philippine Trade Liberalization and Industrialization: What Has Happened and Where Do We Go from HereRafaelita M. Aldaba, Philippine Institute for Development Studies

DISCUSSION PAPER SERIES NO. 2013-21

8/11/2019 STS 2014

9/30

Brain Drain Worsens In 1998, there were 9,877 outbound science workers. In

2009, the number has grown to 24,502 (2.5x)

More than half of these are health professionals and nurses

while a fifth are engineers.

23 % of total science workers pool go abroad to seek

employment.

Philippines ranked 96 out of 139 nations in terms ofavailability of scientists and engineers in the 2010-2011Global Competitiveness Report by the World Economic

Forum.

Emigration of Science and Technology Educated Filipinos (1998-2006) and 2011 DOST SEI studies

8/11/2019 STS 2014

10/30

Brain Drain Worsens The number of scientists and engineers currently

engaged in research and development (R&D)activities across the Philippines is about 8,800.

Allocation for DOST comes to only 0.085% of GDP(1/3 of Thailand's 0.26% and 1/8 of Malaysia's 0.69%) [2012]

UNESCO Science Report 2010: researcherpopulation density of the Philippines is 1 per 12,345population in 2009.Singapore (one per 164), Thailand (one per 3,215), Indonesia

(one per 6,172) and Vietnam (one per 8,695).

Emigration of Science and Technology Educated Filipinos (1998-2006) and 2011 DOST SEI studies

8/11/2019 STS 2014

11/30

Current situation

Lack of basic industries

No program for ruralindustrialization, agricultural

modernization

No genuine infrastructure in

energy, transportation,communications, information

technology and basic services

8/11/2019 STS 2014

12/30

NationalIndustrialization

8/11/2019 STS 2014

13/30

Why build national

industries? Key to establishment of

modern and diversified

industrial economy

Secure livelihood

Satisfy basic needs

Ensure rapid and sustained

economic growth

Achieve economic

independence

Heavy industriesbase metals, basic

chemicals, petrochemicals,pharmaceuticals, machinery,

precision instruments,electronics, and consumer

durables.

LEADING FACTOR

Light industriesprocessing of grains, cereals,

fruits and vegetables,beverages and dairy products,meat and poultry; aquaculture

and fisheries, clothing-footwear,textile and garment industries

and mass housingBRIDGING FACTOR

Agriculture(modernized and

mechanized)BASE

8/11/2019 STS 2014

14/30

National industrialisation

Maximum self-sufficiency in

industrial production of capital

Provide intermediate andconsumer goods for domestic

needs based on national

potential

Ensure food security and self-

sufficiency

Produce primarily for domestic

consumption not exports

Heavy industriesbase metals, basic

chemicals, petrochemicals,pharmaceuticals, machinery,

precision instruments,electronics, and consumer

durables.

LEADING FACTOR

Light industriesprocessing of grains, cereals,

fruits and vegetables,beverages and dairy products,meat and poultry; aquaculture

and fisheries, clothing-footwear,textile and garment industries

and mass housingBRIDGING FACTOR

Agriculture(modernized and

mechanized)BASE

8/11/2019 STS 2014

15/30

...as opposed to...

Current pattern of production,

investments, and trade

Export of agricultural andextractive raw materials

Importation of surplus finished

goods, agricultural

commodities and capital,

Re-export of reassembled or

repackaged imported

manufactures

8/11/2019 STS 2014

16/30

Is there economic basis for

national industrialization? Comprehensively rich natural

resource base

Metals, minerals, energy,

biodiversity, marine resources

Skilled forces of production

Workers, peasants,professionals (incl. scientists

and technologists)

8/11/2019 STS 2014

17/30

Some features ofa national industrialization policy

8/11/2019 STS 2014

18/30

Public sector ownership and

operation of vital industries Nationalization of vital and

strategic enterprises

Main source of raw materials

Main lines of distribution

All public utilities

Social services (housing,

health, education, social

security)

8/11/2019 STS 2014

19/30

Limited foreign corporations and

entities in manufacturing enterprises

Foreign investments will be

allowed only in clearly

unreplicable advantagesin

terms of technology transfer oraccess to capital, products and

markets

Strict regulation and supervision

including entry of all forms of

speculative capital

May be allowed a minority equity

share (not more than 40%)

8/11/2019 STS 2014

20/30

Financing National Industries

Public finance to maximize funds for the

realization of the strategic plan

Eliminate bureaucratic, military andother counterproductive expenditures

(aka pork barrel)

Remove automatic appropriation forforeign debt service

Balance accumulation and consumption

2007 2009

8/11/2019 STS 2014

21/30

2007-2009size of lines correspond toamount of money transferred

Text

Network Visualization ofPDAF releases 2007-2009

Legislator and NGOsthickness of lines = amount of money

8/11/2019 STS 2014

22/30

Anong nawawala dahil sa pork?

8/11/2019 STS 2014

23/30

Genuine national developmentwith a domestic industrial policy

8/11/2019 STS 2014

24/30

Agriculture as base

Provide means of subsistence

Source of industrial raw materials

Vast market for industrial products;

Main reservoir of labor power for

industry and other sectors of economy

Important source of accumulation funds

Biotechnology, high yield farming, low

inputs, efficency, etc.

Heavy industriesbase metals, basic

chemicals, petrochemicals,pharmaceuticals, machinery,

precision instruments,electronics, and consumer

durables.

LEADING FACTOR

Light industriesprocessing of grains, cereals,

fruits and vegetables,beverages and dairy products,meat and poultry; aquaculture

and fisheries, clothing-footwear,textile and garment industries

and mass housingBRIDGING FACTOR

Agriculture(modernized and

mechanized)BASE

8/11/2019 STS 2014

25/30

Heavy industry is leading factor

Provide modern machinery,motor power, chemicalfertilizers, pesticides, and othermeans of production for

agriculture

Produces various lightindustrial machines and lightindustrial raw materials

Provides necessary conditionsfor technical innovation anddevelopment of the nationaleconomy as a whole andguaranteeing independence

Heavy industriesbase metals, basic

chemicals, petrochemicals,pharmaceuticals, machinery,

precision instruments,electronics, and consumer

durables.

LEADING FACTOR

Light industriesprocessing of grains, cereals,

fruits and vegetables,beverages and dairy products,meat and poultry; aquaculture

and fisheries, clothing-footwear,textile and garment industries

and mass housingBRIDGING FACTOR

Agriculture(modernized and

mechanized)BASE

8/11/2019 STS 2014

26/30

Light industry as a bridging factor

Produces necessary

consumer goods for rural and

urban areas

Indispensable in raising living

standards

Requires smaller investments

but provides quick returns

Accumulation fund for

expansion of heavy industry

Heavy industriesbase metals, basic

chemicals, petrochemicals,pharmaceuticals, machinery,

precision instruments,electronics, and consumer

durables.

LEADING FACTOR

Light industriesprocessing of grains, cereals,

fruits and vegetables,beverages and dairy products,meat and poultry; aquaculture

and fisheries, clothing-footwear,textile and garment industries

and mass housingBRIDGING FACTOR

Agriculture(modernized and

mechanized)

BASE

8/11/2019 STS 2014

27/30

Patriotic Science and Technology

! Pushing for pro-people

development

! National industrialization

! Genuine agrarian

Reform

! United with other

progressive sectors

8/11/2019 STS 2014

28/30

Science and technology for the people

Committed to peoples interests

Science for peoples requirements and needs

Responsive and constantly plans

Development and management

Science, technology and natural resources

Consciously linked on peoples needs

Greatest and continuing challenge is to make scienceand technology and progress serve the benefit of themajority

8/11/2019 STS 2014

29/30

Man can find meaning in life. Short and perilous as itis, only through devoting himself to society.

Albert Einstein

Prometheus BoundWeekly column in the Manila Times

Every Thursdaywww.agham.org

8/11/2019 STS 2014

30/30