http://upload.wikimedia.org/wikipedia/commons/b/bf/InternationalReservesvsForeignDebt.jpg
Foreign Debt
The government financed its spending primarily from foreign
debt. From $2.9 billion in 1973, it rose to $6.8 billion in 1976
and $17.3 billion in 1980. The balance of payments also
behaved generally well in the earlier years, with surpluses
recorded from 1973 to 1974. However, an increasing trend of
deficits followed the years afterwards. From 1974 to 1976,
investments were still very high as the government still
engaged in massive spending. Spending on infrastructures
was primarily the focus of the government, targeting an
increase economic growth and tourism . Because of the large
influx of investments from the public and private sector and
the increase in economic activity, together with high domestic
savings which financed part of government spending , the
Philippines survived the first oil price shock, the Middle East
oil embargo which started in 1973 and caused inflation to rise
in the Philippines.
By the years 1977-1980, the Marcoses primarily supported
and focused on the expansion of its government-owned
corporations, which were able to loan from foreign
institutions for investments. According to Joseph Lim of
the University of the Philippines , a businessman in 1981
related to Marcos fled the country with $80 million worth of
debt in international and local banks. Because of the gravity
of the parties involved, the Central Bank, together with
national banks like Philippine National Bank and Development
Bank of the Philippines, formed a bailout package and rescued
the banks and companies implicated, which paved way for
“the expansion of the money supply from 1980 to 1983.” [3]
The outflow of capital, termed “ capital flight ", contributed to
the foreign exchange depletion as seen in Table 2 (qtd. in
Boyle, 1990). "As the import liberalization program started to
be implemented, important sectors … became more and more
monopolized by the cronies of Marcos.”
source wikipidea
natatawa ako dun sa kabilang thread 1 billion ($ or P) lang daw inutang ni Apo, tumawad pa
Ilokanong Cronies lang nakinbang sa Billion Billiong Dollar
