Philippine Foreign Policy

By David Wurfel. In The Political Economy of Foreign Policy in Southeast Asia David Wurfel and Bruce Burton, eds., London: Palgrave MacMillan, 1990.

In comparison with other countries in the region the Philippines and its policies have four major distinguishing characteristics. First, the Philippines has been more dependent for trade, investment, credit and military assistance on one power over a longer period than another Southeast Asian state. Despite the growing intrusion of Japan into the region, the Philippines remains most tightly linked with the US.

It is, of course, the only ex-colony of the US in the region, with a cultural as well as structural legacy. Second, as a consequence of the first point and despite the abrupt changes of regime type in 1972 and 1986, there has not been a full foreign policy restructuring.

Helping to sustain a unique relationship and fostering special perceptions of the external environment is the Philippine’s geographical separation from other Asian countries. The fourth distinguishing characteristic is that, with the possible exception of Burma or, for a time, Cambodia, the Philippines has the weakest state structure in the region, measured in terms of ability to maintain order, implement decisions, and extract resources, with only the early martial law years being at variance from that pattern.

This is manifest in foreign policy by the weakness of the bureaucracy, the child of patronage politics. As a result the policy process has been easily affected by the pressures of intra-elite rivalries, organized interests – both foreign and domestic – and the intrusions of elected politicians, their business friends, and their wives. Together these four characteristics give Philippine foreign policy its distinctive flavor.


Philippine society is loosely structured, dominated by a complex pattern of patron-client relations which arose from the ancient bilateral kinship system overlayed by increasing economic inequality. Human relations beyond the nuclear family tend to be calculated for mutual benefit. Traditionally the weak seek protection not so much in group cohesion as in finding a strong patron. Patrons who do not fulfill the obligations traditionally incumbent upon their supenor wealth and power are abandoned. However, crisis assistance from relatives or friends creates an undying debt of gratitude. Such cultUral values seem to have had an impact on Filipino thinking about international relations (Wurfel, 1966: 152ff). Philippine society more recently, because of the nature of economic policies followed, has been rent by increasing class conflict. A substantial number of peasants and workers, led by some intellectuals, have thus adopted Marxist analysis which glorifies class struggle.

Though the Philippines is home to over 85 distinct languages and dialects, among the approximately 90 per cent of Christian Filipinos cultural cohesion is greater than it is in most other Southeast Asian societies. However, the two most significant ethnic minorities, the Chinese and the Moros, do have an impact on foreign policy. The Chinese, who now number only a few hundred thousand, are important because of their disproportionate economic influence and because their ancestral homeland is a nearby great power. The Moros, or Filipino Muslims, numbering perhaps three million, and concentrated in Mindanao and the Sulu archipelago, were never assimilated to the Filipino nation. A combination of social change, international currents, and perverse government policies, particularly in the matter of land rights, led to an intensified Muslim consciousness in the late 1960s, and to rising armed conflict, which turned Manila’s attention toward the Muslim world (Wurfel, 1985: 222-7) .

In 1972 the Philippines stood third in ASEAN in terms of per capita GNP – a ‘middle ranking developing country’ by worldwide standards. But by the mid-1980s it had become ASEAN’s poorest, and is now struggling to regain the 1981 per capita GNP in the 1990s. The economy was dominated by a largely indigenous entrepreneurial elite (the distinctly Chinese role declined from the 1950s as assimilation progressed) with legitimate and influential access to the policy process (see Agpalo, 1962 and Stauffer, 1966). This weakened state autonomy. Despite past state interventions, for example attempts at land reform and minimum wage laws, wealth and income are more inequitably distributed than elsewhere in Southeast Asia. In fact, the concentration of wealth has grown in the last generation, which has contributed to growing unrest. Besides being highly inequitable, the Philippine economy is heavily dependent on US trade, investment and credit, a legacy of the colonial era.

The Philippine polity, though profoundly affected by socio-economic structures and indigenous cultural values, has borrowed major institutions from the US, by way of the colonial experience. Formal independence in 1946 was preceded by 30 years of almost complete internal self-government, with free elections. The bureaucracy was immersed in patronage politics by the 1920s. Democratic institutions operated primarily for the benefit of the elite; only in the late 1960s did populist tendencies assert themselves, interrupted by the imposition of martial law in 1972. Since the departure of Marcos and the end of the authoritarian period in February 1986, populist democratic tendencies have re-emerged; but the socio-economic elite, which has not significantly changed in composition, appears to be reasserting its dominance through patronage politics. Though mass participation is greater than in the 1960s, the political role of the military has also grown. This holds the possibility of future confrontation. In all periods political parties, important for electoral victory, have had almost no impact on policy.

Despite the rapid expansion of middle class political participation in 1985-86, before that the trend had been towards polarization between ideological extremes. In fact, the Philippines has the strongest Communist-led insurgency in Southeast Asia. It began, like the Viet Minh, as an anti-Japanese guerrilla force during the Second World War, growing to be a threatening revolutionary army – the Huks – at the gates of Manila in 1950, after which it was crushed with US military aid, charismatic leadership and a taste of reform.

It rose again in the late 1960s under new leadership, but was apparently put down after the declaration of martial law . In fact, however, martial law created the political conditions for its revival; the New People’s Army and the National Democratic Front were vehicles for the greatest Communist strength ever by the early 1980s, achieved without significant foreign aid. The doctrinaire anti-Communism which serves the interests of the military institution re-emerged with new vigor after 1986.

leaders, journalists, and businessmen. The elite were almost all male and highly educated (87 per cent were college graduates and twothirds had a second university degree – though less than 15 per cent had any education abroad) (Makil, 1970; Simbulan, 1965; Wurfel, 1979).

The top elite after 1972 took on a somewhat different shape. power was, of course, more tightly concentrated in the President and his family. Elected legislators were gone, as were journalists. A few generals entered the top elite as did a few businessmen financially linked to the President and his wife (the ‘cronies’), replacing families of old wealth. The cabinet became relatively more important. The change in business representation in the top elite had a broader significance: those with old wealth, engaged in commerce, agriculture and manufacturing with relatively minor links to foreign capital (roughly eqivalent to the Marxist category of ‘national bourgeoisie’) were out, while the ‘compradors’, new wealth that was heavily dependent on foreign credit, capital and technology, were in. This was not, however, a simple shift in economic structure, but an overnight transformation of political access and influence determined by Ferdinand Marcos. The ‘relative autonomy’ of the neo-patrimonial Philippine state from the old elite had been sharply increased. By 1980, however, the economic interests of the cronies had become so wide and so distinct from the priorities of technocrats, that crony political influence was directed against that bureaucratic elite, at one point nearly dislodging the Prime Minister. Pressures from the new economic elite thus had again reduced state autonomy, a distinction between the Philippines and the East Asian NICs which may help explain the former’s relatively poor economic performance (Johnson, 1985).

The values and attitudes of the top elite produced images of the Philippines that had consequences for both national power and foreign policy. The shifting self-image had at least two salient dimensions, Asian identity and world importance, in some way linked. Soon after independence, explicitly under Quirino. and implicitly under Magsaysay, the Filipino elite saw itself as apart from Asia, but able to form a ‘bridge’ between Asia and the West (Lopez, 1966: 29-31). This would have meant a uniquely important world role. But during the 1950s, as Filipino leaders came into closer contact with their Asian neighbors, they became aware of the low regard in which they were held, precisely because they were not seen as ‘Asian’, and of their consequent incapacity to play any role as bridge. A new


Although the degree of involvement of particular individuals varied from issue to issue, foreign policy-makers are essentially the top political elite, since the role of the bureaucracy has seldom been very important. Before martial law these numbered 30-40 persons, primarily elected officials (the President, and leading members of Congress), prominent cabinet members, as well as influential Church spate of realism spawned the sense of being a small, weak country. This low posture was functional for gaining greater acceptance in the Asian community, while the pre-Western cultural heritage was resurrected in art, dance and historical research.

By the 1970s, under Ferdinand and Imelda Marcos, self-deprecation was abandoned for unprecedented world ambition, culminating in an unsuccessful bid to host the UN General Assembly meetings. The greatest boost to the national ego, however, was the highly favorable world press treatment of the non-violent ‘revolution’ of February 1986. But the quick turn in the world press to sharp criticism, the seriousness of internal problems, plus the empowerment of a genuinely modest president in Mrs Aquino, revived the ‘small, weak’ self-image.


A well institutionalized foreign policy process is one which relies heavily on a specialized bureaucracy and which usually conforms to procedural norms. By these standards 1972 was a turning point, in different directions. Before martial law constitutional guidelines were taken much more seriously, with the Supreme Court often being asked to adjudicate constitutional disputes. As a result the Supreme Court sometimes made decisions with important foreign policy consequences, for instance, on the criminal jurisdiction of the US under the bases agreement (Dodd, 1968) or on the rights of US businessmen under the Parity Amendment to the 1935 Constitution. Congress also had an important role.

After 1972 President Marcos assumed for himself all power, and the new constitution and the courts were used, often capriciously, to justify his acts. He exercised all executive and legislative powers without a National Assembly until 1978, and even after that he could override the legislature with his own decrees at will. The exercise of his unlimited power to make decrees became increasingly irregular, with secret decrees as well as public ones. Decisions lost legitimacy and became more difficult to implement, Not just foreign policy, but the entire decision-making process was poorly institutionalized.

In the constitutionalist era a confidante of the President had noted that the Philippines did not have a ‘truly professional’ foreign service (Corpuz, 1966: 64). He also pointed out that diplomats did not owe their primary loyalty to the foreign service, or even to the President, but to their Congressional patrons who secured the job. More than a decade later the President himself noted the need to ‘further professionalize the service’ (Marcos, 1980: 213).

However, there had been a shift in 1972 towards a greater role for the Department of Foreign Affairs, and for other bureaucratic agencies involved in the making of foreign economic policy, for instance, the Department of Finance, the Central Bank, the National Economic Development Authority or the Board of Investments. This was a consequence of both the emphasis on an increased role for ‘technocrats’ (top bureaucrats with high academic qualifications and no political backers besides the President) and of the absence of a legislature sharing in policy or patronage. Career diplomats felt that their influence had been enhanced in the first few years of martial law; even the First Couple usually accepted their advice on foreign affairs. But by the late 1970s power and wealth had so corrupted the top leaders that decisions were increasingly made on personal whims without rational analysis. The fact that the First Lady more often substituted for Mr Marcos as his illness worsened also helped explain the situation. The policy process lacked institutionalization in both essential respects.

Thus it is fair to say that the ‘rational choice’ model of foreign policy decision-making, requiring a solid institutional base, was by itself seldom the most useful approach to understanding Philippine decisions. Intra-elite politics and the leader’s imperative were, on the other hand, important in explaining Philippine foreign policy throughout, and were dominant on many occasions. Before 1972 intra-elite politics was structured in large part by the struggle between legislative and executive branches inherent in a system of checks and balances, though, of course, there were also factions within cabinet, and personal rivalries within the Department of Foreign Affairs. The nationally elected Senate usually had several members with presidential ambitions, intent on making life difficult for the incumbent chief executive. The most celebrated conflict over foreign policy was that between the pro-American President Ramon Magsaysay and the nationalist Senator Claro Recto in the mid-1950s. This was complicated by the fact that the under-secretary of foreign affairs was a protege of Senator Recto, while the secretary spoke for the President. Thus intra-bureaucratic rivalries were linked to those between Recto, with some Senate backing, and the President (Romani, 1956: ch 6; Abueva, 1971: ch 19). Perhaps the greatest impact of this controversy was the scuttling of the Garcia-Ohno Agreement on Japanese reparations. Political rivalries intervened to delay an important foreign policy decision again in the 1960s. President Macapagal, acceding to an American request, asked Congress for funds to send a contingent of Filipino troops to Vietnam. Senate President Marcos, who was soon to be Macapagal’s opponent in the 1965 elections, took a nationalist stance against it. But after he was elected, Marcos himself pushed through Congress essentially the same proposal (Buss, 1977: 42-3,46-7). The legislative role in policymaking re-emerged strongly after an elected Congress reconvened in July 1987.


With a population of over 50 million and a per capita GNP of several hundred dollars, rising steadily, plus a wealth of natural and human resources, the Philippines by the late 1970s should have been able to qualify as a ‘middle power’, at least in the Third World. With nearly a quarter of a million men under arms, in regular and militia forces, neither was Philippine military strength insignificant. The level of output of the institutions of higher education provided the Philippines with a pool of skills that was used both at home and around the world. The United Nations and its agencies had given prominent positions to several Filipinos, most particularly to Rafael Salas, Marcos’ former executive secretary, who was under-secretary general and director of the UN Population Programme. The financial resources and sophistication of the Philippine corporate world were also sufficient to be making an impact abroad.

But whatever the potentials – which could be realized only in the context of a confident self-image – Philippine constraints far exceeded resources, not uncommon in the Third World. One constraint that had been painfully obvious even in the 1970s was that created by a divided political culture, with many Muslims rejecting

Filipino identity, then rising in rebellion. Coming as it did in conjunction with a world oil crisis, with Muslim states the major suppliers, this jeopardized Philippine petroleum supplies.

In some ways the very nature of the political system was a constraint. A ruling elite with a neo-colonial mentality quickly turns to the dominant power when resources are needed. And a neopatrimonial system – in which support is recruited by distributing material benefits, from both private and public sources, controlled by the patron – with an expanding population and increasing political mobilization is always seeking new resources to reinforce and extend clientage. Since the bureaucracy in such a system is weak, and thus also extractive capabilities, it will have an even greater tendency to turn to the international patron for help, as happened especially under Roxas, and Quirino, and again under Marcos. Philippine bargaining power on the world scene, already constricted by pressures from the world capitalist system, was limited by these domestic tendencies.

The most serious constraint until 1986 was regime legitimacy at home and abroad; already low in the mid-1970s, it declined further as the 1980s progressed. After the assassination of Ninoy Aquino, the world was more aware of how Mr. Marcos dealt with opponents and how the Filipino people felt about his government. Armed opposition spread to more and more provinces. His need for American support grew.

The growing political instability which declining legitimacy produced also affected economic decisions. Billions in investments left the country in the months after the assassination of Aquino. By the end of 1986 the Philippines had become the first country in the region to register negative economic growth for three years straight. The GNP declined by nearly 10 per cent with the Philippines’ increasingly referred to as ‘the sick man of Asia’. The expanding debate in the US Congress on military assistance highlighted corruption in the Philippine armed forces. The utilization of existing diplomatic skills and the training of younger foreign service officers also deteriorated. Many of the factors which allow a nation to mobilize its resources and then apply them to foreign policy were in decline

Even when governmental legitimacy rebounded after February 1986 and national pride swelled at the unique, non-violent method used to banish a dictator, the extent of economic devastation and military incompetence only became more obvious; national power itself did not rebound, for capabilities were not rebuilt. Nevertheless the promise of more rational and honest economic management did initially improve Philippine bargaining power with the IMF and private banks. By 1987, however, political stirrings in the military revived Filipino self-doubt about stability as well as international misgivings. A patronage binge by Vice-President and Foreign Minister Salvador Laurel had further weakened the Department of Foreign Affairs. Laurel’s successor, Raul Manglapus, found the restoration of at least minimal professionalism a difficult task in 1988 especially since he was himself subject to patronage pressures. ‘


Philippine trade was skewed toward the metropolitan power more strongly than that of any other Southeast Asian colony. Just before independence 80 per cent of Philippine trade was with the US, and in 1946 the Bell Trade Act of the US Congress legislated an extension of free trade until 1974. Reliance on US markets, and high US prices, helped to determine the costs of Philippine production in sugar, once the major export, thus making later efforts at diversification very painful. Reliance on American suppliers, on the other hand, made Filipino consumers keenly aware of and loyal to American brands, thus inhibiting production and sales by Filipino entrepreneurs in the same product line. Nevertheless, Philippine trade with the US did drop from nearly 75 per cent in 1950 to about 33 per cent in 1973, a lessening of trade dependence. Yet in the 1980s the US, though rivaled by Japan, was still the major trading partner, the only case in Southeast Asia where that position had hardly changed in 50 years.


While international constraints may have appeared to some to be more severe than those emerging from the domestic political economy, they were often intertwined with domestic initiatives or failures. Dependence on the US in several respects was not simply an imposition of the world system on the Philippines – though in part it was that, dating back to 1898 when Dewey sailed, uninvited, into Manila Bay – but was also a reflection of the attitudes, actions and inactions of Filipino leaders, which helped transform assymetrical interdependence into ‘dependency’. It was fair to say, as some did (Pomeroy, 1977), that that leadership was itself the creature of American colonialism. But after more than 40 years of possession of the apparatus of legal sovereignty, with the bargaining potential which that involves, the colonial heritage does not seem to be a fully adequate explanation of all that has happened. Even the declaration of martial law , which was so convenient for American military and economic interests, and was stamped with US approval, was to a considerable degree a product of raw Filipino ambitions within the framework of intra-elite competition. Even as one recognizes the impositions of the world system, it is not possible to ignore the Philippine political process.

Classical dependencia would deny any autonomy to either leadership formation or foreign policy in the Third World. But here it is necessary to assert the semi-autonomy of both, as would appear to be the view even of some writers in the dependency mode (for instance, Sunkel, 1969). Nevertheless, we must reiterate that the scope of autonomy in the Philippines over time has been less than for most other Southeast Asian states. Dependence has both economic and military dimensions. Economic dependence can be quantiifed in the areas of trade, investment, aid, and debt, moving from the oldest form of world-wide economic relationships to the form most recently of major interest.


American investment built up over the colonial period until it was $ 173 million by the late 1930s. This investment – according to US sources – grew to nearly $ 450 million by 1961, but at a declining rate as 1974 approached, the date on which special status for Americans, that is, parity with Filipino citizens, was to come to an end (Villegas, 1983: 181).

While American investment in the Philippines by some standards may have seemed modest – Golay claimed that direct US investment in 1977 was only about 4 per cent of the assets of all non-governmental enterprises (Golay, 1983: 159) – by other standards it was extensive. A Philippine government study just before martial law found US-controlled firms had holdings of over $ 2 billion, amounting to 80 per cent of all foreign investment. Furthermore, 43 per cent of the sales of the top 50 Philippine corporations were made by firms with more than 50 per cent US equity, while in certain industries American dominance was even greater (Poblador, 1971). Nor was command of economic resources limited to investment capital: through interlocking directorates foreign-owned banks sometimes exercised control without much equity. And for every dollar foreign investors brought into the Philippines they borrowed $ 25 locally (Villegas, 1983: 11; Doherty, 1979).

This last phenomenon was so upsetting to Filipino entrepreneurs, who had to compete for scarce credit, that in 1977 – reviving a similar, unsuccessful, move in 1971 – a government committee was established to screen credit applications by foreign corporations, and then moved towards a policy to restrict approval. The US Ambassador came to the defense of American business interests on this one however, and Philippine restrictions crumbled. Here was a clea; negative link between the extent of American economic interests and Philippine government autonomy.


Government to government grants and loans may also constrain the recipient’s autonomy. In the 1940s the threat of withholding of ‘aid’, in the form of war damage payments, was used to force the adoption of the ‘parity amendment’ to the Philippine constitution. In the early 1950s, when the US was still the only significant source of intergovernmental assistance, the offer of $ 250 million over a fiveyear period was made conditional on the signing of an agreement requiring the Philippine government to undertake certain reforms, upon recommendation of US advisers (Wurfel, 1959). While the US still calibrates its grants and loans to signal political favor or disfavor to recipients – AID releases to the Philippines in the four years prior to martial law were $ 56.2 million, compared to $240.5 million in the next four year period (Bello and Rivera, 1977: 50) – American leverage by the 1970s had been reduced by the fact that Japanese official development aid had become greater than that from the US. Yet in many situations the Japanese acted in concert with US policy anyway.


Foreign debt did not become a major constraint in the Philippines until the 1970s. This was, in part, an imposition of the external environment and, ironically, a consequence of Philippine policy designed to avoid the constraints of foreign investment. (It was noted, quite correctly, by officials in 1972 that foreign equity might flee on threat of political instability, whereas borrowing put capital under Filipino control.) The timing in the great spurt in foreign indebtedness – from $2.2 billion in 1972 to $ 9 billion by 1979, and then a threefold jump by 1985 – was at first linked to the world oil crisis of the early 1970s which produced hundreds of billions of ‘petrodollars’ which needed to be recycled. Bankers avidly peddled loans, seducing many a hapless Third-World leader. As the debt grew larger – World Bank loans to the Philippines, 1973-76, grew 1060 per cent, faster than to any other recipient – and interest rates climbed, the creditors’ concern about repayment also escalated and thus their tendency to impose more conditions (Bello, 1982). But not until 1984 did non-performance on IMF conditions slow down lending.


Military bases themselves have an ambivalent implication for dependency. The imposition of the bases agreement practically as a condition for legal sovereignty certainly demonstrated a neo-colonial status in 1946. Furthermore, the hundreds of millions of dollars of US expenditures each year to maintain and operate the bases flows into the Philippine economy and creates another type of economic dependence; this is an amount that the Philippines has come to count on. The presence of US forces also serves as an ultimate fallback, a potential source of assistance to a government facing a serious insurgency. The US began to play such a role in 1973-74, but then phased it out; calculations of political cost both in the Philippines and in the US cautioned against it.

However, just like a major investment of foreign capital after it is made, the bases once established can become a kind of hostage. They give bargaining power to the Philippines as long as the US wants to continue operating them without hindrance. This may have played a role in the secret funding of the Philippine contingent in Vietnam. But it was not until the negotiations began in 1975 on the bases agreement revision that the Philippine government appeared to recognize the full potential of its leverage. American withdrawal from Vietnam had actually increased the bases’ strategic value, further enhanced by the US desire to project a presence in the Middle East.

In any case, US military assistance provided the overwhelming majority of supplies needed by the Philippine armed forces. In FY 1975 the Marcos budget revealed that P 81 million was allocated to ‘logistical services’ and P 45 million to a ‘self-reliant defense posture’, meaning investment in a Philippine-based small arms industry. In the same year US military assistance (grants and sales), mostly arms! and equipment, totalled $ 54.8 million, or more than P 363 million (US DoD, 1978; RP; 1975, 459, 465). Military supplies still come primarily from the US. It was this kind of logistical dependence that gave the Joint US Military Advisory Group (JUSMAG) such weight (see below). The slowing down of US military aid deliveries in the last years of the Marcos- Ver regime because the Armed Forces of the Philippines (AFP) would not follow the advice being given was thus ‘self-reliance’ purchased at considerable cost. What must be noted, however, is that the cost was shouldered because the line of advice was seen as threatening to the power of regime incumbents. This was, in fact, a pattern: deviance from the role of dependent elite was most often initiated only when top decisionmakers felt their short-term power in jeopardy. Quirino in early 1950 was another case in point. Even in 1986 one could see this phenomenon, with Mrs. Aquino being most sharply critical of the US just at the point she felt she was not being supported by the White House.

The evidence of dependence on the US along several dimensions is quite impressive. But to argue ‘dependency’, or loss of autonomy, one must go further to show common interest between dominant and dependent elites and, I would insist, shared values and attitudes as well – what is frequently referred to as the ‘neo-colonial’ mentality. Shared elite values and interests are certainly both present in the Philippine case. But the introduction of import substituting industrialization in the late 1940s created new frictions, both between Americans and Filipinos and within the Filipino elite. A rupture was avoided by the Laurel-Langley Agreement of 1955 which provided for a compromise in which Filipinos could impose tariffs on US imports until 1974 more rapidly than the US could tax Philippine imports, while ‘parity rights’ for US businesses in the Philippines were greatly expanded. Filipino exporters, Filipino manufacturers and American investors in the Philippines all got something. Nevertheless, the rise of economic nationalism in the late 1950s indicated that the expanding group of Filipino manufacturers still felt disadvantaged.

The imposition of martial law and the ascendency of Marcos neopatrimonialism from 1972 restored an earlier level of commonality between Filipino and American elite interests. Marcos, challenged politically by nationalist manufacturers and their friends, sought either to crush them or control them with martial rule. The single incident which most dramatically revealed the new pattern of shared interest was the Westinghouse contract to build (with outmoded technology) a nuclear power plant. Though the New York Times reported that a Marcos crony pocketed $ 30-40 million as middleman for the deal, subsequent indications are that persons closer to the centers of political power in both Washington and Manila received even more substantial benefit. The challenge of the revolutionary movement by 1979 further expanded areas of common political interest between the Marcos and US elites.


The Americanization of Filipino elite values and attitudes, the psychological dimension of neo-colonialism, brings us to the sharing of American perceptions of the external environment. In the late 1960s the Far Eastern Economic Review had noted that some viewed ‘the Philippine political establishment as so closely tied to the US that it fails to conceive the possibility of separate national interests’ (FEER, 28 December 1967). President Diosdado Macapagal, speaking for the Liberal Party, reminded his audience that ‘Our party believes that if our Republic is to endure . . . our people must remain committed to . . . the free world led by the United States in the ceaseless struggle between democracy and communism’ (Macapagal, 1961: 96-7). As leading members of Congress debated the sending of Filipino troops to Vietnam in 1965, they relied primarily on Time and Newsweek as sources of information, without questioning the journalistic biases; there were almost no independent Filipino sources on Vietnam. In fact, Vietnam was not even considered a ‘crucial issue’ by most members of the elite (Makil, 1970, Table II); it was before Congress only as a result of an American request.

When Ferdinand Marcos defeated Macapagal in 1965 he enthroned a new level of rhetorical autonomy, declaring that the ‘first principle’ underlying Philippine foreign policy was ‘the conscious exercise of national independence and sovereignty on each and every issue’, then led the Philippines into closer dependency on the US. Shared perceptions with the US of the world economy became relatively more important in the 1970s as technocrats trained at Wharton and Harvard took over management of foreign economic policy.

Marcos’ ambivalence was perhaps more. blatant, but not fundamentally different from that which underlay the policies of some of his predecessors. Even those Filipino leaders capable of flights of cold war rhetoric harbored a deep-seated lovelhate relationship to the US which colored, unevenly, their world image. Macapagal out of power became quite critical of the US in the 1980s. A world image consistently inconsistent with that of the US also became the dominant one in intellectual circles by the early 1970s. Already in the 1950s Senator Claro Recto, the most renowned nationalist, had declared ‘Asia for the Asians’ and opposed a whole range of US policies with lengthy arguments that challenged standard American perceptions (Constantino, 1965).

But only three significant aspects of the external environment were seen differently by the Philippine and American ruling elites: Japan, the Borneo situation, and the world-wide colonial question. In no case, however, was the difference great enough to put a severe strain on Philippine-American relations and by the 1980s these differences had faded. The view of Japan in the 1950s was based, of course, on the fact that Filipinos, unlike Americans, had suffered an invasion and brutal occupation (Wurfel, 1986). But it was also linked to the Filipino image of Philippine-American relations. The absolute amount of postwar American aid to Japan, the enemy, was greater than that to the Philippines, the loyal ally (or client), for which Filipinos are still deeply resentful. Thus the Japanese obligation to pay reparations was much larger in Filipino than in American eyes, which produced policy conflict.

Differences over Sabah were less open, on a less salient issue, but still led to friction. While the US viewed the creation of Malaysia as an orderly transfer of power by a colonial ruler, which would lead to a stable pro-Western regime, most Philippine leaders, including the fiercely anti-Communist Macapagal, were not only sympathetic to Sukarno’s charge of ‘neo-colonialism’, but were even concerned that there was a national security threat because left-wing Chinese from Singapore would have easy access to the Borneo territories (Fernandez, 1962). These images were, of course, useful, since they served to justify the Philippine opposition to Malaysia which was more firmly based on an entirely different ground, the territorial and proprietory claim to Sabah.

The third and final difference was derived not only from contrasting experiences between the Philippines and the US but from the awareness in Manila by the 1950s that the Philippines’ international image needed bolstering. Thus the Philippines came to view colonial issues in the” United Nations not as cold war questions, as the US often did, but as situations demanding a show of solidarity between colonial and ex-colonial peoples. This was the issue area in which there was greatest divergence between the US and the Philippines in the General Assembly.

Finally elite perceptions of foreign threats should be noted. Perhaps because of geographical isolation, Filipino leaders had less of a sense of threat from any direction than those in other Southeast Asian countries. Interviews in the early 1970s produced the conclusion that even senior military staff ‘appear relatively unconcerned about foreign threats’ (Maynard, 1976: 466). In the early postwar years the recollection of a real Japanese threat was strong, and is still latent. While the fear of China was reinforced by Cold War rhetoric in the 1950s and 1960s, it quickly dissipated as the US shifted its stance and Beijing avoided aiding the New People’s Army (NPA). The ‘threat of Vietnam’ was sustained by Filipino participation in the war, even as non-combatants. But when the Americans withdrew, fears of and interest in Vietnam subsided, despite the invasion of Cambodia. Occasional reports of Soviet submarines from Camh Ranh Bay disgorging supplies on the Philippines coast seem to be without basis and are believed only on the far right. The unconcern about foreign threats may, in part, have been a side effect of most Filipinos’ exaggerated notion of the efficacy of American power which was not really shaken even in 1975, since American strength in the Philippines was not affected. Certainly the highest salience reserved by the elite for US words, actions and capabilities cannot be doubted. Only a distinct minority define those words and deeds as seriously threatening.


In talking about attitudes and images and about the changing structure of economic relations we have already suggested some possible patterns in the shifts of Philippine foreign policy since independence. It is now appropriate to group those patterns in four periods, though the differences between periods are not great. Philippine foreign policy has experienced a slow evolution, with no fundamental change in basic orientation because there have been no fundamental changes in the character of elites or elite images or in the nature of constraints.

Postwar Reconstruction: Pure Neo-Colonialism – 1946-57

Given the magnitude of wartime destruction and the granting of independence to a nation in ruins, the degree of economic and military dependence on the US was probably inevitable. The urgency of economic recovery displaced concerns for autonomy.

After more than three years of Japanese military oppression American colonialism looked very good by comparison. The Philippines was the only country in the colonial world that referred to the return of the Western colonial power at the end of the Second World War as ‘liberation’. The US imposition of a constitutional amendment to favor American business, endorsed by President Manuel Roxas but faced with opposition in the Congress of the Philippines, was still supported in a referendum. The retention of 23 American bases with free rent for 99 years had been a prerequisite of the granting of independence. A Joint US Military Advisory Group was set up in March 1947 to train the new Philippine armed forces.

Elpidio Quirino, the second president, was faced with a growing Communist-led peasant rebellion in Luzon, and within a year witnessed the victory of Mao Zedong in China. He was not well regarded by Washington, because of corruption and mismanagement, and his call for an Asian NATO and more economic aid had been dismissed (Welch, 1984: 300-1). So that in early 1950 he briefly explored the question of neutralism (Buss, 1979: 29) apparently to attract the American attention that he had failed to get in a more suppliant mode. But with the invasion of South Korea in June, the Chinese threat became real and thus also the felt need for US protection. In 1951 he signed a rather weakly worded Mutual Security Treaty with the US. Both security and economic welfare goals took precedence over autonomy in Philippine policy priorities.

But the further growth of the Communist-led Huks nearby Manila was Quirino’s main concern, as it was that of the US. American military aid increased and Ramon Magsaysay was appointed secretary of defense to reorganize and revitalize the armed forces. But in order to get substantial new economic assistance, Quirino had to sign an agreement that committed the Philippine government to tax, labor and agrarian reform and gave American advisers considerable opportunity to shape the policies in question. The Quirino-Foster Agreement was, in effect, institutionalized neo-colonialism, giving a peculiar legitimacy to American penetration of the Philippine political process, despite objections from some Filipino Congressmen. American penetration continued at a covert level with CIA guidance and support for Magsaysay’s successful presidential campaign in 1953.

Magsaysay’s pro-American sentiments were not hidden; during the campaign he said, ‘I was not so sure . . . after we were given our independence that American-Philippine unity would last undiminished. These doubts are gone. We belong together and know it’ (Abueva, 1971: 214n). It is not surprising that Magsaysay hosted the conference that created the US-dominated SEATO. He endorsed US policy in Vietnam after the Geneva Conference and some of his friends and supporters worked with the CIA to establish a Filipino civilian presence there.. In fact, it may be said that Magsaysay’s pro-Americanism stimulated the growth of the Filipino nationalist movement.

The Nationalist Interlude: 1957-72

Vice-President Carlos Garcia, who succeeded to the presidency when Magsaysay died in a plane crash in 1957, was much more sympathetic to the new nationalism than had been his predecessor. For a time it appeared that autonomy goals might be given highest priority. Senator Recto and his slogan ‘Asia for the Asians’ became so influential under Garcia that many Americans were frightened. But Recto’s recommendation that the Philippines recognize Communist China was not followed. In fact, despite the rising tide of nationalism in the Congress and the press, Garcia felt the need to make the traditional pilgrimage to Washington to ask for aid. The Philippines continued to be a mainstay of SEATO. Nevertheless, Vice-President Macapagal, with a more pro-American image and reputedly some American financial backing, defeated Garcia’s bid for re-election in 1961, primarily because charges of widespread corruption seemed justified to the voters.

For all of his pro-American rhetoric, however, Macapagal’s foreign policy initiatives gave the US some discomfort. He had a long-time personal interest in the claim of the Sultanate of Sulu in the southern Philippines to North Borneo. In June 1962 Manila presented such a claim to the British, complicating plans for the formation of Malaysia. In the meantime Macapagal also became enthused about an old Philippine dream of a pan-Malayan federation, to be a counter to Chinese influence in Southeast Asia. After preparatory talks Macapagal and Sukarno, together with a somewhat reluctant Tunku Abdul Rahman of Malaysia, held a summit meeting in Manila in July 1963 where there was agreement in principle on the formation of a tripartite MAPHILINDO. But the dispute over

North Borneo caused the Philippines to withhold recognition of Malaysia later in the year, so that attempts to implement the MAPHILINDO idea failed. At the same time Sukarno’s increasingly aggressive stance caused Macapagal to back away from that entente under pressure from his own intelligence advisers as well as the US. The US quietly scuttled Philippine efforts to get serious negotiations on their territorial claims. Macapagal’s frustrations led him to change Philippine independence day from the US-determined 4 July and to end American diplomatic representation of Filipinos abroad in the absence of Philippine missions (Sussman, 1983: 210-28).

Yet in economic terms Macapagal’s policies were quite congruent with US interests. He devalued the peso and removed foreign exchange controls, as well as undertaking other recommendations made by the IMF and favored by exporters. Before the end of his term he had requested Congress to authorize the sending of Philippine forces to South Vietnam. But the US regarded him as unreliable. The traditional Philippine ambivalence about the US had produced too much policy variance. US war damage funds which could have been released before Macapagal’s re-election bid in 1965 were not; for this and other reasons he lost to Ferdinand Marcos. Marcos more skillfully wove the nationalist strain into a foreign policy that gained wide support without upsetting the Americans. In fact, he became quite successful at inducing expanded American aid and putting it to his own political benefit, as in the construction of school houses before the 1969 elections. And it was Marcos who received secret American funds to support Filipino troops in Vietnam.

Changes in the policy process were closely related to the declaration of martial law . But coincidentally there was also a change in the international environment in the 1970s which helped give a new cast to foreign policy. Strategic threats and challenges receded. There was no Korean invasion, no descending Chinese horde, nor even a new Malaysia on the border. The final Communist conquest of South Vietnam and Cambodia in 1975 had been a foregone conclusion for some time. Even top military officers were not concerned about foreign threats. Thus President Marcos had unchallenged control of the policy process and was not diverted by strategic fears. He could devote his attention to domestic priorities, as he did. He bolstered the regime by neutralizing its enemies and building support among key groups within society. For the first time regime survival became the dominant theme of Philippine foreign policy. It was designed to deny support to Muslim rebels and the New People’s Army, and to win over intellectuals, the economic elite, and the middle class while solidifying support among the military. Marcos’ policies were ‘developmentalist’ (in the sense used by Weinstein, 1976) since he saw rapid economic growth as the most likely source of legitimacy.

One nationalist critique had been of the ridiculous extremes to which anti-Communism had been carried – exclusion of the Yugoslav basketball team from a Manila tournament by President Macapagal is often cited as the zenith of this tendency. The Philippines had diplomatic relations with no Communist-ruled state until President Marcos’ second elected term, when, prodded by nationalist industrialists, he exchanged ambassadors with Yugoslavia and Rumania. The big break came when an embassy was opened in Beijing in June 1975, following a visit by the First Couple. Nationalist intellectuals, including some senior foreign service officers, were assuaged. The Americans, of course, had already shown the way and the Civil Liberties Union of the Philippines claimed that ‘The truth is that the “bold” and “innovative” moves taken by the Department of Foreign Affairs, which it passes off for “independence”, are the latest variation of its traditional subservience to America’s global interests’ (CLUP statement, 15 October 1975). This was probably an exaggeration, but the American shift did permit the Philippine initiative to take place without disturbing the Washington-Manila axis (Quisumbing, 1983: 26-8). Thus the Marcos moves did not warrant being called a full restructuring.

Foreign Policy for Regime Survival: 1972-86

Even though the declaration of martial law in 1972 marked a severe restructuring in domestic politics, the break with the Philippine tradition of foreign policy was much more modest. It is true, however, that with the disbanding of the elected legislature the President was more completely in charge than ever before. For instance, the Taiwan Lobby in Congress which could have blocked relations with Beijing, was rendered nearly impotent. Furthermore, a regime which relied heavily on a greatly expanded military was much more concerned about its arming and supply. An authoritarian regime also had the capability to reduce the penetration of the system by friend and foe alike. Access to government officials by foreigners was, for the first time, restricted. Foreign support for labor unions and other NGOs was regulated. Military intelligence became both more pervasive and more effective.

Establishing relations with China served another purpose. The President gained Chinese assurances that they would provide no aid to the Philippine Communist movement – the Chinese were also eager for diplomatic relations. Undoubtedly, this proved a persuasive argument for Marcos’ reluctant military brass. Furthermore, the Chinese promised small but steady shipments of oil to the Philippines at a time when Arabs were showing their displeasure with Marcos’ military action against the Moros.

Diplomatic exchange with the Soviet Union was not accomplished until 1977. Since the Soviet’s allies within the Philippines, the old Communist Party, had already been co-opted by Marcos, Moscow had a lower priority – but Moscow itself also showed less interest in the Philippines than did Beijing. In the same year the Philippines recognized the three Indochina states, and Vietnam pledged to refrain from the use of force or subversion.

The increasing prominence that Philippine foreign policy gave to ASEAN was also a response to the nationalist desire for a stronger Asian orientation. The membership of Indonesia, both a Moslem country and a major oil exporter, gave ASEAN added importance. Marcos was able to gain Jakarta’s understanding of and sympathy on the Moro problem, plus expanded oil supplies. Good relations with Malaysia, made easier by Marcos’ announcement in 1976 that he intended to drop the Philippines’ Sabah claim, was facilitated within the ASEAN framework, helping to cut off the MNLF’s foreign supply line. Furthermore, President Marcos described ASEAN in 1980 as an organization in which ‘there are exchanges which indicate a common and mutual interest in security . . .’, apparently referring to the anti-Communist intelligence network (Manila Journal, 18 February 1980).

Aside from ASEAN, Third-World affinity was shown by an (unsuccessful) effort to gain observer status at the Non-Aligned Conference in Colombo in 1976, an ostentatious appearance by the First Couple at the UNCfAD conference in Nairobi in the same year, and the hosting of UNCfAD in Manila in 1979, when Marcos helped draft the statement issued by the Group of 77 developing countries. Though designed to mollify Filipino nationalists, these events also provided an ego-satisfying role for the First Couple. (One has to recognize the existence of more than one level of motivation.)

Expanding ties with the Muslim world to help interdict support for the Moro forces included Imelda’s visits to Cairo and Riyadh, and a Manila invitation to King Hussein, as well as a stronger proArab stance on the Palestinian question. But the most dramatic and successful move was the opening to Colonel Muamar Khaddafi, who both supplied and influenced Nur Misuari, the MNLF leader, then living in Tripoli. The First Lady went to Libya as the President’s emissary in December 1976 and, following personal talks in which she apparently persuaded Khaddafi to cut military aid to the Moro forces, a Philippine government team hammered out an agreement with Misuari for a cease-fire and Muslim ‘autonomy’ in parts of Mindanao and Sulu (Manila Journal, 9 January 1977). The Tripoli Agreement was never fully implemented, however.

While the effort to project the Philippine image as a successful, developing, non-aligned country may have been fun for the leadership, the effort to satisfy the military required some long, hard bargaining with the US. For Marcos it was most important to provide up-to-date arms and equipment for an armed force which was his strongest political supporter. But by 1974 the ‘human rights bloc’ in both the US House and Senate had growing influence, just as detailed reports of arbitrary arrests and torture of Philippine political dissidents began to reach Washington. Given the mood of Congress, Marcos had to find a new means to get the US to equip his forces. Familiar with US base rental arrangements in Spain, Portugal, Turkey and Greece, he perceived ‘rentals’ as politically more certain than ‘aid’, and laid the ground carefully. After a meeting of his National Security Council in April 1975 the President complained, echoing Recto, that ‘The bases, like magnets, only invite attack by any nation hostile to the US’ and suggested that the Philippines might take them over, then negotiate new terms with the US for their use. Anti-American stories began to appear more often in the controlled press. In Washington consternation prevailed; not all officials understood the Marcos strategy, nor the limits to his bargaining power (Wideman in Philippine Times, 16—31 May 1976).

In April 1976 formal talks began in Washington on revision of the bases agreement. But Marcos, overplaying his hand, asked for too much, was rebuffed and decided to wait for Carter (Romualdez,

1980: 52ff). In the Carter administration serious thought was given to moving the bases to Guam, should they become too costly. But after the Iranian revolution and the Soviet invasion of Afghanistan, Clark Field and Subic Bay suddenly became essential way stations to a new cradle of conflict, and were revalued upward by the Pentagon.

Philippine demands for broader jurisdiction over criminal acts by US servicemen, and continued insistence on generous base rentals delayed agreement, however, until January 1979. The US did not give on the jurisdiction question, and the designation of a ‘Philippine Base Commander’, with the Philippine flag flying alongside the American, was a cosmetic change that did not satisfy the nationalists. The Philippines received $ 500 million in military grants and credits over a five-year period, in addition to ‘economic aid’. This amounted to a doubling of the level of US military assistance. And with Reagan in office the next five-yearly review of the bases agreement was completed early, in June 1983, with military aid raised to $ 900 million for the period, including a higher grant component and lower interest rates. Congress tried to delay delivery as Marcos’ abuses became more obvious, but the Bases Agreement did reduce his vulnerability.

Despite the extreme importance of the military dimension, probably the most urgent task for foreign policy under Marcos was to mobilize international resources for economic growth. The economic elite were the prime beneficiaries of the President’s efforts, but he realized that without a general sense of economic progress he would lose legitimacy in the eyes of the Filipino people as a whole. His policies sought to attract more foreign capital, with numerous new concessions – from new areas for 100 per cent foreign investment to maintenance of low wages – and to expand foreign borrowing, influenced by successful export-oriented industrialization elsewhere.

New foreign investment entered at a sharply accelerated rate from 1973, but expectations were not sustained; the 1973 inflow in constant dollars was never again equalled.

With the increased emphasis on credit by 1978 commercial loans from private international banks were greater than all government rsources, bilateral or multilateral. But private banks acted on assurances of viability by the WB/IMF and its Philippine Consultative Group. The World Bank, in order to back up its assurances, exercised increasing influence over essential elements of Philippine government economic policy – as was admitted in a leaked memorandum from the Bank itself (Bello and Rivera, 1977: 97, citing draft by Gould). In 1976 the Marcos government formally agreed to three years of ‘close economic supervision’ by the IMF, renewed in subsequent agreements. World Bank officers gained some legitimacy within the Philippine policy process, at least as great as that of American advisers in the 1950s.

The events of the early 1980s indicate, however, that World Bank! IMF supervision was no more effective than the influence of the technocrats – who shared World BanklIMF views – over the cronies in the Marcos regime. Marcos and his cronies were powerful enough to divert foreign resources, which came in at higher and higher interest rates, to their own purposes, rescuing failed enterprises and salting away dollars abroad. It was such escapades that pushed the Philippine foreign debt up to $ 26 billion by 1983 while productivity declined. World economic conditions were certainly not favorablea point which Marcos frequently reiterated – but no other country in Southeast Asia combined rising debt and falling GNP to the degree that the Philippines did. It was a curious combination of circumstances: World BanklIMF control over the economy increased, but it was not sufficient to head off disaster instigated by the even greater power of the bureaucratic capitalists around Marcos over the distribution of credit from government institutions. Thus Philippine economic decline – which started as a great push for development – had to be blamed as much on autonomous patrimonialism as on dependency. Marcos’ foreign economic policy, largely viewed as a success in the mid-1970s, by the end of his term had put the country in an unprecedented tailspin.

Aquino Foreign Policy

Mrs. Aquino came to power in a manner unique in Philippine history. Not only were military intervention and unprecedented mass demonstrations necessary to implement her electoral victory, but she emerged without the prior blessings of the White House, loyal to Marcos almost to the end – though this is not to say that the CIA or the State Department were unsympathetic. Her unprecedented popularity gave her the potential of a new autonomy in both national and international realms. That popularity was reconfirmed in the constitutional plebiscite of February 1987 and the legislative elections of May. But she did not utilize her charismatic power as she might have. Charisma was merely used to reinvigorate neo-patrimonialism, substituting for the economic resources that were no longer available.

Foreign policy at first had relatively low salience under Aquino, perhaps because of her confidence of legitimacy achieved through charisma and electoral processes. She thus felt no compulsion to use foreign policy for regime survival as had Marcos.

Furthermore, a much more open regime, over which the President has ineffective control, is more penetrable by foreign interests. Thus Pentagon pressure exercised through the Philippine military helped to scuttle a more prolonged cease-fire, and the CIA moved in rapidly to promote armed anti-Communist vigilantes, working through cabinet-level contacts. The apparent use of delayed aid delivery by the Pentagon to press for greater military reform even goaded President Aquino herself into sharp criticism of Washington in May 1987 — shades of Marcos.

The most important foreign policy issue of the decade, the fate of US military bases, was deliberately downplayed by Mrs. Aquino. At the beginning of the election campaign in late 1985 she had favored the removal of the bases, but by January 1986 had become comfortable with a different formula: respect the present agreement until it expires in 1991, and then ‘keep my options open’ (Agence France Presse, 2 January 1986). This position was carefully crafted to hold together the disparate wings of her coalition, though her opponents on the Left believed that she would decide to renew in 1991. She stuck with this position after assuming office, for it avoided distracting attention from more urgent political and economic issues. Though it worried Pentagon officials, the State Department recognized the constraints on her and was hopeful about the President’s ultimate choice.

The new element in the situation was the constitution ratified in February 1987. Though proposed clauses outlawing foreign military bases had been defeated in the Constitutional Commission, two crucial provisions were adopted – small steps towards dependency reversal. One provided that if the bases agreement were to be extended in 1991, it would have to be elevated from an executive agreement to a treaty and would thus require concurrence by a twothirds vote of the Senate. Furthermore, the constitution’s ‘declaration of principles’ stated that ‘the Philippines, consistent with the national interest, adopts and pursues a policy of freedom from nuclear weapons in its territory’.

Even though the US refuses to confirm officially the presence of nuclear devices at Clark Field or Subic Bay, the belief that they are there is almost universal in well-informed circles. Thus the utility of the bases for the US,. if this provision were fully implemented, would be severely restricted. In August 1987, without consulting the President, ten members of the President’s party out of the 24 newly elected senators sponsored a bill that would outlaw ‘possession, storage, or transport’ of nuclear weapons on Philippine territory (Washington Post, 21 August 1987). In June 1988 it passed the Senate overwhelmingly. Thus it appeared that diplomatic nuances preferred in the executive branch might not determine Philippine policy. But the bill was stalled in the House and the Secretary of Justice ruled that regulation of nuclear weapons was the President’s prerogative. When a new base compensation package was signed by the US and the Philippines on 17 October 1988, providing a record $ 960 million over two years, there was an exemption of ‘transit, overflights or visits by US aircraft or ships’ from any requirement of Philippine government approval for ‘storage or installation of nuclear weapons’.

Finding 16 Senate votes to endorse renewal of the bases agreement in 1991 might be difficult. But the outcome is still very uncertain. Some senators, despite nationalist rhetoric, when face to face with the economic costs to the Philippines of US base withdrawal, might acquiesce. Yet, if Mrs Aquino, having lost her current popularity, should endorse an extension while the US presses its demands clumsily, nationalist rhetoric could carry the day. In any case, if the Senate should fail to ratify a new bases agreement, the danger of a successful military coup – if not already transpired – should not be discounted. For the impending loss of a large portion of US military aid could be the most effective unifier of a factionalized armed force. But by the end of 1988 there was increasing talk in both Washington and Manila of phased withdrawal of the bases. A speech by Secretary Manglapus in January 1989 suggested that the bases, for various reasons, might become ‘obsolete’. He concluded, ‘Whatever the developments, we are preparing for eventual conversion of US facilities to civilian use’ (Philippines Free Press, 28 January 1989).

Whatever the strains in US- Philippine relations, however, relations with the other superpower were initially much worse. An endorsement of the Marcos ‘re-election’ in February 1986 by the Soviet ambassador – almost unique in the Manila diplomatic community, naturally soured the incoming Aquino administration towards the USSR. But by 1988 the Gorbachev aura had warmed relations, though some officials had a hard time burying the Cold War. The first ever visit by a Soviet foreign minister on 22 December produced an invitation for Mrs Aquino to go to Moscow, which was accepted. Shevardnadze won favor by assuring Filipinos that the Soviet Union had never supported and had no intention of supporting the Communist Party of the Philippines/NPA insurgency (FB/S, 22 December 1988, p. 45). His hint that the Soviets might dismantle their bases in Vietnam even before Washington made any decision to withdraw from Clark Field or Subic Bay was also well received.

A state visit to Japan, on the other hand, was earlier on President Aquino’s agenda than for any of her predecessors, indicating Japan’s rising economic importance to the Philippines. Cory was also attracted by the great outpouring of sympathy for Ninoy shown by the Japanese public after his assassination, a sympathy transferred to her in 1986.

Economic constraints frustrated expressions of autonomy by some in Aquino’s government, for example, the statement by Solita Monsod, head of the National Economic Development Authority, in 1986 favoring ‘selective repudiation’ of the foreign debt, especially loans purloined by Marcos and his cronies. IMF/World Bank pressures have since helped to subordinate that view to the ‘full repayment’ stance of the Secretary of Finance and the Central Bank. Some of the same IMF/World Bank conditions, pushing ‘liberalization’, as had been imposed on Marcos have again been accepted. Debt to equity schemes will expand the role of foreign capital. But now economic nationalists have the benefit of a free press and representation in Congress. The debt rescheduling agreement initialed in 1987 -less favorable than Argentina’s – was not approved by cabinet and had to be renegotiated. Bills have been introduced in Congress to reduce the debt service payment to 25 per cent or less of exports, compared to the 1987 rate of 42 per cent. A bill creating a powerful, congressionally dominated foreign debt commission was passed, but was vetoed by the President. Thus the desire for greater economic autonomy is pushing against the constraints, but the trend in decision-making up to 1988 has favored the IMF/World Bank. In December the government promised the IMF to reduce budget deficits and scale down growth targets.

Initial indications are that Congress will indeed have an impact on relations with ASEAN. Some leading legal minds appear to be interested in reviving the Philippine claim to Sabah, blinded by juridicial and nationalistic argument to the adverse political consequences such a revival would have for regional consensus. In fact, the Aquino administration eagerly sought ASEAN support in May 1987 on the question of Mindanao autonomy. Negotiations with Nur Misuari of the MNLF broke down, despite a rather generous offer by Ambassador Emmanuel Pelaez, and the Philippines needed the understanding of Islamic nations to prevent Misuari from mobilizing them against Manila. Thus initiatives by Congress on Sabah and by the Department of Foreign Affairs on Muslim autonomy may collide, the consequence of constitutional separation of powers without strong executive leadership.

In fact, many observers fear that the Philippine government in the next two or three years will suffer severe immobilism, given the President’s unwillingness at times to exercise the power she has available. Immobilism will jeopardize economic growth, inhibit foreign policy initiatives, and broaden opportunities for foreign penetration. It could eventually trigger a military takeover.


The degree of Philippine dependency that we have noted, perhaps unique in Southeast Asia, is certainly the consequence of the international environment. The Philippines is the only ex-colony of a superpower in the region, which left it with the legacy of US military bases.

Even the structure of the domestic political economy is, a legacy of Spanish and American colonialism – large landholdings, weak industry, and an electoral system which fosters neo-patrimonialism and undermines bureaucratic effectiveness. But in the last 40 years that structure has become thoroughly integrated with Filipino culture. A process which is the result of interaction between structure and culture has a dynamism of its own, not simply determined by the external environment. The domestic political economy, through military corruption, incompetence and the failure of social reform, has created an insurgency which has seemed to survive its own crisis and is not likely to fade away. The horrendous foreign debt, unparalleled in the region, is also in large part a result of the domestic system – the unrestrained greed of neo-patrimonialism in an authoritarian setting. Thus, the future of Philippine dependency, or its reversal, will rely as much or more on internal dynamics as on developments in the world capitalist system.


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