Letter to Inquirer:

Success in Philippine Industrialization

I was touched by the letter of Mr. Manuel F. Almario, dated July 15, 2009 regarding
industrialization as key to development.

Having been in the electronic components industry for twenty three years and teaching
Production and Operations Management in an International Academy in Makati City for
fifteen years, I was able to expose and obtain actual experiences in the so called
Philippine industrialization.

According to Claro M.Recto, a noted Philippine statesman and senator, the

industrialization in the Philippines was not real and genuine but only superficial. Two
examples he mentioned were on the Beverage and Pharmaceutical Industries being
operated by the Multinationals. Beverage industry was using imported malt and cola
concentrate to mix with Filipino sugar and water. Pharmaceutical Industry was using
imported concentrate to repackage them into capsules and tablets. Profit generated from
this process was repatriated to the home country rather than invest it on again for further
economic activities.

Working as a Tin Plating Engineer in late 70’ to a Semiconductor company in Taguig

Metro Manila, I was instructed and pushed by a Plating consultant from United States to
buy only American analytical reagent grade acid chemicals and postpone the use of
locally made acid chemicals. I wonder at that time if analytical chemistry was different
from that being used in the United States. I followed him only for three months and help
develop ChemPhil chemically pure grade acid. I was able to reduce cost from 450 pesos
per liter to 120 pesos per liter and help the Pasig- based company to continuously provide
jobs.

Working as an Engineering Manager to a local Semiconductor Company in Muntinlupa

Rizal in the 80’s, I noticed that for every integrated circuit we assembled, 75 percent of
the dollar value were being sent back to the country where we purchased the raw
materials.The value added concept was very minimal and the usual local components
utilized were only labor and energy. Machineries, equipments and technologies were all
imported from Japan, United States, and Germany. Some machine tool spare parts were
all imported from Hong Kong, Singapore, and South Korea. Note that no local alternative
is available during that time. This has been a good example of how to drain our foreign
exchange reserves.

Industrialization in the Philippines will only succeed if our current and future policy
makers will seriously and religiously adhere to the tenets of 1987 Article XII of
Philippine Constitution-National Economy and Patrimony. Yes I believe to Mr. Manuel F.
Almario’s idea of leaving agriculture economy but not totally. My idea is to use
agriculture as a first stage and upgrade and strengthen our existing policies to grow and
speed up to second stage agro-based industries and further to third stage to service
industries. It’s about time to exploit and use our own bountiful natural and marine
resources. We can industrialize our agriculture and mineral produce. We can manufacture
dairy products out of our carabaos and goat milk. We can maximize fish production from
our sea waters and package them to acceptable cost canned goods. We can develop
technologies to extend life of fruits and vegetables to weeks if not months. We have
Filipinos that can mined our mineral resources and convert these to acceptable
application. We have and can be the best tourism haven in this part of the world. We have
best mind Filipino inventors and scientist that will answer our research both basic and
applied. We have the best human resources that we can utilized to operate these Filipino
industries.

It is true that industrialization is a primary tool in country development. However we

only accept a development that is sustainable and green. We do not want an Industrial
development that will destroy environment and exploit people in the name of profit as
Western industrialization did.

Pedrito A. Salvador
Deputy Spokesman, NEPA
National Economic Patriotism Association

Professor, Production and Operations Management

International Academy of Management and Economics