Donor activity in the Philippines dates back to the early years following independence from the Japanese occupation and American tutelage. During this period, what the Philippines needed the most were the resources to support the national recovery efforts of the newly independent state. This meant rebuilding the economic and social structures, which were damaged by the war.
The US, in recognition of this need, extended food aid and economic support to the Philippines as early as 1946, making it the first aid donor of the new Republic. The US led the development assistance to the Philippines during the latter’s early years as a sovereign nation. The US focused on the development of a wide range of basic institutions and national services that the country required (USAID Philippines 2005) to strenghten the government. Most of the assistance extended to the Philippines were in the form of grants.
In the succeeding decades, Japan, together with other donor agencies came in although the US remained as the Philippines’ biggest development partner.
During the 1960s, donor activities focused on “community development” to help people help themselves. This shift of focus was relevant to the needs of the country during that period. It was the period when there were increasing public calls for self-governing at the local levels. The US, encouraging democratic process in the Philippines, focused its assistance on rural development, specifically on small-scale activities in agriculture, social services, and community development. The US also focused on building the capacities of the local governments in local planning and program implementation.
Based on various estimates consolidated by USAID, the Philippines received a total of $1,104 million worth of official development assistance from 1952 to 1972 and $13,146 million from 1978-1988. There is a remarkable shift in the type of assistance received by the Philippines between these two periods. From 1952 to 1972, about 56% of the development assistance was in the form of grants and only 44% were loans. Meanwhile, Meanwhile, during the period 1978-1988, around 80% of the development assistance was in the form of loans. The US, nevertheless, maintained a larger proportion of grants in both periods.
Emerging from the dictatorship period which lasted from 1972 to 1985, the Philippines was in a state of economic and financial crisis. In support of the government’s priorities, donors concentrated on helping the country achieve economic stability and growth. The US concentrated on improving macroeconomic management, encouraging domestic and international private sector development, and alleviating sector-specific constraints through policy-based sector assistance programming (USAID Philippines 2005). Improved health and more manageable population growth were also emphasized during this era.
Today, Japan, the US, and Australia remain the Philippines’ major bilateral donors, while the World Bank and the Asian Develoment Bank are the biggest funding donors. Their development programs for the Philippines, since the recent years have focused on economic development, community development, governance, security, health, and education.
Article by: D.Medrana, 2007
Main Sources: USAID Philippines website, The Library of Congress Country Studies and the CIA World Factbook
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