Prometheus Bound: The State of Science and Technology in the Philippines (2005) PDF

Prometheus Bound The State of Science and Technology in the Philippines Samahan ng Nagtataguyod ng Agham at Teknolohiya para sa Sambayanan (AGHAM) Advocates of Science and Technology fo...

Prometheus Bound The State of Science and Technology in the Philippines Samahan ng Nagtataguyod ng Agham at Teknolohiya para sa Sambayanan (AGHAM) Advocates of Science and Technology for the People 2005 sntfinal.pmd 1 3/2/2006, 3:36 AM  This material has been published with financial support from the office of Representative Satur C. Ocampo. Reproduction in parts or in whole is allowed even without permission from the publishers provided that the authors are properly acknowledged when quoted. sntfinal.pmd 2 3/2/2006, 3:36 AM  FOREWORD ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ S WITH ANY SEARCH FOR UNDERSTANDING OF A PARTICULAR a SITUATION, we begin the analysis of the Philippine state of science and technology with its description. This entails quantifying and describing the concrete state of things and listing the particulars of what we mean by a backward and stunted state of science and technology. That we do not have an advanced state of science and technology is a statement generally shared and experienced directly by many scientists and engineers in the Philippines. To deepen and enrich our understanding beyond this perceptual and descriptive level, we have to investigate and study the existing relations between science and society; between scientists and the products of their activities; between scientists, science and technology and the rest of society. The place of science in society is already familiar to scientists— how scientific activities depend on the changing needs of society; how these activities change productive methods and how these productive methods eventually contribute to change in society. Science, technology and society are inextricably linked in the daily production activities to meet man’s material needs. This is true in every historical epoch human societies have undergone. This is one of the key elements that have guided us in writing this paper and therefore we take a bit more detail in looking at the relations between our economic and social conditions to the current state of science and technology. Another key idea is trying to understand why despite new knowledge and technologies being developed almost routinely around the world, still a great majority of people live in abject poverty. And nowhere is this irony more intense than in countries like the Philippines. We have bright and learned scientists; we have people who can benefit from the skills of these scientists. Yet scientists find it hard to practice in this country and develop new technologies for our people. We have engineers who can find jobs only in foreign-owned companies or abroad. Meanwhile, we import manufactured goods at great costs. This despite the intellectual understanding of the processes and technologies necessary to produce such goods. Why is it so? Who benefits from this situation? How can we change it? Improving the state of science and technology in the Philippines is therefore not just a matter of increasing the number of scientists, building the necessary infrastructures and generating successful technologies. Improving science and technology should mean addressing both sides of the coin: why Philippine science and technology remains backward and stunted and why it fails to benefit our people. sntfinal.pmd 3 3/2/2006, 3:36 AM  This paper hopes to contribute in the understanding of these issues. In the process of writing this paper, we saw that there are a lot more information that should be sought and that even more questions need to be answered. But we believe that this paper is a step bring closer to understanding and discovering ways on how to make science and technology meaningful to the Filipino people. Edward Deveza, MS Assistant Professor Technology Management Center University of the Philippines Diliman Henry Ramos, Ph.D Head Science and Society Program, College of Science University of the Philippines Diliman. Giovanni Tapang, Ph.D. National Chairperson Samahan ng Nagtataguyod ng Agham at Teknolohiya para sa Sambayanan AGHAM sntfinal.pmd 4 3/2/2006, 3:36 AM  TABLE OF CONTENTS ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ Foreword Introduction 01 Framework 03 The Backward and Stunted State of Science and Technology in the Philippines 6 Basic Industries in the Philippines: Little or No Industrial Activity 7 Mineral Extraction 8 Chemicals 9 Energy 9 Manufacturing 10 Food Products Manufacturing Chemical Manufactuuring Garment and Textile Manufacturing Electronics Manufacturing Agriculture 13 Crops Subsector Livestock and Poultry Subsector Science and Technology Education 16 Research and Development (R&D) 17 Control and Ownership of Industrial Firms in the Country 21 Analysis 22 Conclusion 28 References The title PROMETHEUS BOUND is a metaphorical statement of the current S&T situation in the Philippine society. Prometheus is also a greek word for “forethought”. Prometheus is a god in greek mythology, who gave the mortals all sorts of gifts. Prometheus’ divine gift of fire unleashed a flood of inventiveness and productivity in the rapidly developing mortals. As punishment for giving the ability to create and develop without the gods, Zeus had Prometheus in shackles and each day, Zeus’ eagle would devour the liver of his immortal flesh. Each night the flesh would heal so the eagle could begin anew at the first touch of dawn. sntfinal.pmd 5 3/2/2006, 3:36 AM  LIST OF TABLES ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ Table Number and Title 1 National Income in Millions of Pesos during the First Quarter of 2002 and 2001 2 Number of Employed Persons, in Thousands, by Major Industry Group, January 2003 3 Manufacturing Sector Based on Employment in 1993 4 Capacity of the Food Manufacturing Sector in Metric Tons 5 Philippine Private Agricultural Research, 1985 and 1995 6 Types of Agricultural Firms with R&D Activities 7 Total Quantity of Patented Agricultural Technologies from 1948-1995 8 R&D Expenditures in US$ 9 Preliminary Estimates of National R&D Expenditures by Sector at Current Prices (2002), in Thousand Pesos 10 Preliminary Estimates of National R&D Expenditures by Types of Research at Current (2001) Prices, in Millions of Pesos 11 Patent Applications of Residents and Foreigners in Selected Countries 12 Total Number of R&D Personnel 13 Full-time and Part-time R&D Personnel by Sector sntfinal.pmd 6 3/2/2006, 3:36 AM  The State of Science and Technology in the Philippines 1 INTRODUCTION ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ T HE EXTRAORDINARY RAPID ADVANCES in science and technology (S&T) are transforming old industries, creating new ones and now permeate almost every aspect of human life. Yet science and technology also confronts its greatest challenges to address widespread famine and hunger, rapid ecological destruction, the breakdown of health systems, social decay and disintegration. Daily, one sees and hears of new discoveries that typify the progress in humanity’s understanding of nature and society: new advances in physics, biology, technology, space discoveries and the like are commonplace. Yet the pace at which these rapid changes occur obscure the fact that the immense newly-released constructive forces of a new scientific technology are brought into a deeply divided world with uneven development. These great technological advances and scientific discoveries have failed to bring concrete benefits and real development for the majority of the people of the world. Even with the level of agricultural productivity possible today, almost one billion people go hungry and 160 million more are malnourished. Every day, more than 70,000 persons join the hungry and starving masses in the world. On the other hand, in 2004, the world’s richest 20 percent own 85 percent of the world’s income. This is 150 times the wealth of the world’s poorest 20 percent. The world’s three wealthiest persons, all based in the US, have combined assets greater than the gross domestic product (GDP) of the 48 poorest countries with a total population of 600 million. The concentration and centralization of technologies, research and development and capital to only a few industrialized countries has been unprecedented. Giant corporations have merged with each other resulting- to only two companies engaged in manufacturing big commercial planes, only three giant oil companies remained out of the “seven sisters” of the 1970s and only 11 from the former 40 independent car manufacturers worldwide. The adoption of higher technology and the full swing of “free market” globalization have served to deepen and aggravate the situation of the people not only of those in developing countries but even those in industrialized ones. Why is it that despite the great advances, science and technology is still unable to answer the needs of the people? This glaring fact is most felt in underdeveloped countries where science and technology is not accessible nor has it effectively accelerated social progress. Most of the high technologies are used and appropriated by corporations towards production for their own profit and providing for the needs of the people is not given attention. Developing countries, the markets for the products of the same corporations and sources of their raw materials, are left out and prevented to develop their science and technology capability. sntfinalb.pmd 1 3/2/2006, 3:30 AM  2 PROMETHEUS BOUND In the case of the Philippines, this has been pointed out by several studies on the national science and technology situation that focused on research and development indicators in relation to economic productivity [1-7]. Some studies [4-6] show that the dismal economic growth in the last 35 years is due to gaps in research and development (R&D). These gaps are national and sectoral in terms of expenditure, budget, manpower and inefficiency in institutional arrangement. Philippine firms would rather import foreign technology and pursue the “adaption of existing products from abroad to the Philippine market”. Poor economic performance and the backwardness of S& T is indeed a vicious cycle from which existing and past government policies in science and technology have failed to bail the country out of. These policies are in the numerous S&T development plans of the Department of Science and Technology (DOST) since 1986: the S&T Master Plan (1991-2000), Science and Technology Agenda for National Development (STAND, 2000), The Medium Term Plan of the Department of Science and Technology (DMTP, 1999-2004) and the recent National Science and Technology Plan for 2002-2020. These plans fixed targets for certain levels of indicators such as technology achievement index, patent output, publication, R&D, manpower per million population, corporate R&D spending, number of private R&D laboratories, education, expenditures and high technological exports as percentage of manufacturing, but have failed to address the fact that even with high levels of these indicators, it would still not automatically follow that science and technology would bring long-term benefits to our people. While these indicators were adequate in comparing the S&T situation relative to other countries , they overlook the end-beneficiaries of S&T products. While there were attempts in linking scientific and technological indicators with economic conditions , they were incomplete and inadequate. The greater significance of a deeper look at the state of S&T lays not so much in comparing the country’s performance with others but more in how the greater segment of the population has been unable to benefit from the fruits of S&T in a social setup that keeps our economy underdeveloped. This paper attempts to put the state of S&T within the context of the country’s overall national development in order to point out the factors that have prevented the growth of science and technology in the Philippines and to gain insights on how we can take the path of science and technological development that would benefit the majority. The paper would proceed as follows: after a brief discussion of the overall framework, the next section provides data and outlines trends in the science and technology sector. An analysis of these trends and data follows in section 4 while the last section puts forward our recommendations. sntfinalb.pmd 2 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 3 FRAMEWORK ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ T HROUGHOUT THE AGES, human societies have created the bases of survival, sustenance and advancement using natural resources through S&T. Science is used to create processes, tools and technology to enhance man’s interaction with nature. Significant advances in S&T have been reached in the past few decades. Man witnessed rapid developments in information technology, genetic engineering, medicine, chemistry and other fields. Advances in science and developments of new technologies have pushed the economic development of society. The industrial revolution in the early stage of free market competition provided the tools for mass production of goods. The use of S&T for the market increased the production and profit for the capital owners. At present, the intense market competition dictates the direction and pushes the rapid development of S&T [10-13]. The present era is characterized by advanced technology on the one hand and widespread suffering and dislocation on the other. Science is now a definite fixture in any industry. Research and development for new materials and processes is vital to industrial success. Governments have also poured a lot of investment in research activities with similar aims as industry. At no time other time in the past has the interaction between science and the productive process become much closer and more important than today. In comparison to the 1900s and before, science and technology is now done on a larger scale and at a much more rapid pace. Historically, man use science and technology in his interaction with nature, to produce goods for everyday existence. The advent of surplus led to the stratification of society into classes and permitted the economic and politically dominant class to dictate the allocation and use of resources and tools in the production of goods. Science and technology bridges the established and transmitted practice of the production activities of man, the pattern of ideas and traditions in society and the rights and privileges of the classes that make it up. Science and technology in each epoch of historical development was shaped and directed by the existing relations in that era. The flowering of Greek science was reflective of the rise and decline of the slave-owning Iron Age society. The growth and instability of the feudal subsistence economy that had little use for science was reflected in the long interval of the Middle Ages where superstition reigned supreme. It was in the Middle East where scientific activity had proceeded during this time keeping classical Greek knowledge alive. When the feudal order was broken by the rise of the bourgeoisie, it was only then that science could again advance at a faster pace than before. sntfinalb.pmd 3 3/2/2006, 3:30 AM  4 PROMETHEUS BOUND As capitalism fought its early battles and had its first successes as the dominant economy in Holland and Britain, these same conditions for the rise of capitalism made experimental science possible and necessary. The practical success of the subsequent discoveries made by Galileo, Newton and their contemporaries all contributed to the next great technical advance: the Industrial Revolution. The Industrial Revolution ushered in the factory system and seemed to forecast at the time the triumph of a progressive capitalism allied with science. However, the extraordinary rapid evolution of understanding of nature and the development of techniques— science and technology— was much faster than the motion of social arrangements that controlled them. These new discoveries inevitably required new social adaptations to cope with them successfully. Currently the dominant mode of producing goods is one that sacrifices people and the environment in favor of profit. The current capitalist system is one with global reach and is characterized with increased concentration of production capacity into a few. Production for profit by its very nature does not provide the vast The dominant mode of new population of wage laborers that it had brought into existence a sufficient share of goods producing goods is one that or opportunities to allow for continuous prosperity. With this logic of capitalist sacrifices people and the production, monopoly capital conscripted science and technology to create new products and environment in favor of profit. processes, better and more efficient than the old, in order to survive intense competition. This fueled further the technological revolution as monopoly capital used these new ideas and processes to increase production. The transformation and revolution in the physical sciences in the twentieth century were important and far more rapid than the great seventeenth-century revolution. They enormously increased the power of the physical sciences as a means of understanding not only physics and chemistry but nearly every branch of science. The explanation of biological phenomena in atomic and molecular terms transformed biology into one where we can understand molecular structure, the interrelations of specific nucleic acids and proteins and link it to wider ecological processes. This new vision of biology was given a push largely from outside the discipline of the subject due to new techniques, ideas and explanations from other sciences under the pressure of new problems presented by the expanding fields of agriculture and medicine. This irony and tragedy of modern science and technology are thus due to the fact that science and technology has been under the almost complete dominance of monopoly capital in the current production system for the ultimate objective of gaining profits. The advances in S&T are not used to sntfinalb.pmd 4 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 5 solve the problems of humankind, such as starvation, poverty, failure of health systems, environmental catastrophes and social disintegration and rottenness. In underdeveloped countries such as the Philippines, the situation is aggravated by the absence of basic industries and a real manufacturing sector. Agricultural and mineral production is geared for export of raw products. Most industrial enterprises are owned and controlled by foreign interests. These foreign investments have not translated to technology transfer or to the development of an industrial sector in the country. In fact, worldwide, the net capital transfer from developing countries to the developed capitalist countries amounting to US $111 billion in 1998 nearly doubled to US $193 billion in 2002. This paper will present how this dominance is particularly reflected in the case of the Philippines. This paper will show that the lack of basic industries, the concentration of control and ownership of existing firms in the country and the export-oriented and extractive nature of mining and agriculture can all be understood as a result of the country still serving its role as a provider of raw materials and market for the US, Japan and other countries. sntfinalb.pmd 5 3/2/2006, 3:30 AM  6 PROMETHEUS BOUND THE BACKWARD AND STUNTED STATE OF SCIENCE AND TECHNOLOGY IN THE PHILIPPINES ASIC INDUSTRIES PROVIDE THE FOUNDATION for development B and the advances in other industries. The minerals and metals industry provide copper, iron, aluminum and other ore for the production of capital and consumer goods, energy and tools for the communications, construction, engineering and food industries. Basic industries are the foundations for industrialization. The presence of a thriving industry necessitates the development of skilled S&T manpower. Its absence on the other hand, indicates that there would be no real impetus for the development of an adequate number of science and technology manpower. The state of science and math education reflects the quality of S&T training in the country and the support programs for the development of S&T manpower. What are the needs that current S&T education caters to? Are the graduates of S&T courses in schools, particularly from state universities and colleges, sufficiently trained for our own industrialization? Meanwhile, research and development (R&D) is one of the major factors in increasing further the production of goods and services. A review of the state of R&D is given by Cororaton. R&D activities are usually conducted both by government institutions and private firms. Looking at R&D would give us an idea of how S&T is used in production as well as how scientists acquire the skills and technologies in government laboratories and private firms. The use of technology in these firms produces innovations for the development and production of value-added products. This would in turn increase the competitiveness of these manufacturing firms. Finally, it is necessary to look into the ownership and control of the country’s strategic industries. This will basically answer how S&T resources (i.e., technology and manpower) are used in our economy and who primarily benefit from them. This will also reveal why most advanced developments in science and technology are not used and enjoyed by the people through improved production. Looking at the control and ownership of these sntfinalb.pmd 6 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 7 industries would also reflect the general direction of S&T development in the country. Using these parameters, the generally backward and stunted state of S&T will be shown in the context of current economic situation. It is our assertion that the backward and stunted science and technology is primarily due to the character of our economy. Taken in this light, the strategic plans of the government for science and technology can be assesed and appreciated on how they address these economic causes of underdevelopment. Basic Industries in the Philippines: Little or no domestic industrial activity ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ A close inspection of the existing industries in the country shows that the scale of industrial production is small and underdeveloped. For example, in a country where 70% of the labor force is involved in agricultural production, there are only 12 fertilizer firms producing all their input needs. Employment in major economic sectors reflects this low development in industry. The yearly employment profile reflects the small and underdeveloped level of industrial production. The labor profile from 1960 to 1995 for instance showed that the share of the industry and manufacturing have not risen from between 15% and 11%. Of the 30 million workforce in the industry, only 1% is in the manufacturing and electronics industry. Based on government statistics, local basic industries including agriculture, mining/quarrying, chemical manufacturing and energy, contribute to the national income by almost one-third of the total revenues. Local industries engaged in micro and livelihood enterprises make up 91% of all the business in the country. These home-based cottage industries employ low technology and have a labor-management structure of less than 10 workers. Micro enterprises cannot answer the need for long term investments necessary to spur industrialization as they only subsist on simple tools and equipment with a very small management structure. They are unstable, providing informal and semi-formal employment, little job security, lack of standard benefits and give wages below the minimum set by Congress. According to Habito, even the small to medium enterprises comprising of 10 – 199 workers are too small to respond to the prerequisites for industrialization. An almost negligible 1% of the total number of businesses that account for large enterprises is concentrated in garments and semiconductor production. Service providers of basic utilities such as telecommunications, transportation, water and electricity exist although most technologies and research and development for the maintenance and upgrading of these utilities are mostly foreign sourced. Basic industries such as steel production are absent. Manufacturing of sntfinalb.pmd 7 3/2/2006, 3:30 AM  8 PROMETHEUS BOUND machinery, chemicals and other industrial products are limited or non- existent. Furthermore, most of this industrial activity would be limited to foreign owned firms. Wealth and businesses in the Philippines are concentrated in the hands of a few families. The largest 10 families control half of the capitalization in the corporate sector. For example, the Ayala family alone controls 17.1% of the total market capitalization. Ayala Corporation is owned by the Ayalas and Meiji Life of Japan. Other tie-up corporations of the Ayalas are the Globe Telecom and ITT. Mineral extraction The Philippines is ranked in the world’s top 10 in chromite, copper, gold and nickel production. It is in fact second to Indonesia in Asia-Pacific in terms of mineral prospectivity and resources [18-19]. Around 400,000 people, 75% of whom are small-scale miners, are involved in the mineral industry. Forty-four percent are in the extraction of metals (44%) and the rest are in limestone, marble and sand extraction. The Philippine Associated Smelting and Refining Corporation (PASAR) remains to be the only copper producer in the country. Metal production accounts for nearly 100% of mineral export earnings. This indicates that little or no mineral processing is being done inside the country, with most of the raw ores directly exported to countries such as Japan (in the case of nickel and copper). The minerals and metals industry can provide copper, iron and ore for the production of capital and consumer goods, energy and tools for the communication, construction, engineering and food industries. Given the scope of mineral utilization, the establishment of a mineral industry would be the foundation of industrialization. With the existing policies geared towards foreign-based investments for export of raw and semi-processed minerals, the state of the mining industry remains extractive and underdeveloped with little or no processing done for domestic industrial use. Despite sporadic mining activities, communities along mining areas subsist on small opportunities that are offered to them with no just compensation from the land that they have nurtured. Government mining policies favoring foreign mining interests have been hurting small-scale miners who have to contend with piecemeal resources. With the recent reversal of the Supreme Court of its earlier decision, the Philippine Mining Act of 1995 or RA 7942 now allows 100% foreign ownership under Financial or Technical Assistance Agreements (FTAAs) and Mineral Processing Permits (MPPs). This law favors foreign corporations to venture into large-scale mining in the country and allows them “beneficial ownership” of the country’s vast mineral resources. Some 30 mining companies are expected to start operations after the SC reversal on top of the 299 mining sntfinalb.pmd 8 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 9 rights and contracts that have been approved and registered at the DENR. These cover at least 14.226 million hectares, or roughly 50 percent of the country’s land area. Under the FTAA, complete ownership of water rights, land rights and mineral resources is given to foreign corporations. These are mostly monopoly transnational corporations (TNCs) that help project illusory economic growth with the entry of these investments. The law, however, allows the repatriation of profits and resources to where these TNCs are based. Chemicals The chemical industry plays a significant role in the development of other basic industries. Petrochemicals are vital to plastic production as well as a variety of downstream products that can be processed into various consumer goods as well as packaging and construction materials and other industrial goods. Drugs, medicines, cosmetics and toilet preparation production are also dependent on a well established chemical industry. At least 1,000 local firms comprise the chemical industry in the Philippines that involve small-scale development of petrochemicals, oleochemicals and fertilizers. The Philippine Resins Industries, Inc. remains as the only active producer of The chemical industry in the polyvinyl chloride (PVC) in the country, while only two other companies engage in country remain small and polystyrene plastic production. In 1998, two more plants for polyethylene and peripheral in nature and firms polypropylene production were established. All other materials that are used for these plastic production are currently imported. serve as distribution arms. Production of minor coconut oil based-chemicals and raw outputs from vegetable and animal fats comprise the oleochemical sub-industry. Twelve firms are in the manufacturing of fertilizers, two of these, the Philippine Phosphate Fertilizer Corporation and Atlas Fertilizer Corporation, are government owned. The chemical industry in the country clearly remains small and peripheral in nature, with Philippine firms merely serving as distribution arms of large foreign multinationals of major industrial chemical products. Energy A consortium of local and multinational conglomerates that covers the entire energy production from supply and distribution runs the local energy industry. Meralco, providing supply in Luzon while private owned electric cooperatives supply electricity in the provinces, governs the power distribution sector. The government has put up for sale the generation and transmission sntfinalb.pmd 9 3/2/2006, 3:30 AM  10 PROMETHEUS BOUND components of the government-owned National Power Corporation (Napocor) after the Philippine Congress passed the Electric Power Industry Reform Act (EPIRA) in 2001, resulting in relatively high industrial and residential costs of power. Energy is primarily imported even if the domestic geothermal power production is the second largest in the world. The Malampaya natural gas field discovery is being developed by Shell Philippines Exploration B.V. (SPEX), Texaco Inc. of the US and the Philippine National Oil Co. (10%). It is estimated to have some 70.8 billion cubic meters of gas reserves for 20 years. R&D for safe and sustainable sources of energy, such as solar, wind and hydropower, is also under foreign dominance and control. The country’s oil consumption is estimated at 360,000 barrels/day [bbl=barrels] and about 6 million tons of coal per year. Local production accounts to only around 8,460 bbl per day. In 2001, energy production was broken down into the following: fossil fuel: 55.6%, hydro: 17.5% and other sources (mainly geothermal): 26.9%. Manufacturing Based on government statistics, industry includes four sub-sectors; mining and quarrying, manufacturing, electricity and gas (or energy) and construction. It accounts for almost 33 percent of the country’s total revenues. Table No 1: National income in millions of pesos during the first quarter of 2001 and 2002 Source: GNP/GDP by industrial origin 2001 2002 2003 Agriculture, fisheries, forestry 0 49,176 051,358 Industry sector 077,977 079,453 Service sector 105,969 111,054 GDP 233,122 241,865 Net factor income from abroad 015,728 019,265 GNP 248,850 261,130 Micro enterprises are very small businesses using simple tools and equipment and have a very small management structure with less than 10 workers. “Livelihood enterprises employ material-based, low technology, labor-intensive activities directed at earning a living rather than making profits. They are mostly home-based or cottage enterprises engaged in furniture making, handicrafts, food preparation, garments and others.” Small firms may even fall under the category of “sweatshops.” The capacity to use and develop the technology of the country is a major factor for the success of industrialization. In the era of globalization, technology has been the “key to achieving international competitiveness.” This will be seen on the level of innovation in the different sectors of the industry. sntfinalb.pmd 10 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 11 Table No. 2: Number of employed persons, in thousands, by major industry group, January 2003. Source: Major Industry Group Total Philippines 30,119 Agriculture 11,146 Agriculture, hunting, and forestry 10,012 Fishing 01,134 Industry 04,560 Mining and quarrying 000.98 Manufacturing 02,767 Electricity, gas, and water 00.117 Construction 01,578 Services 14,414 Table No. 3: Manufacturing sector based on employment in 1993. Source: Type Total Cottage (less than 10) 78,530 small (10-99) 09,761 Medium (100-199) 00.818 large (200) 00.945 In an effort to boost industry productivity, the Department of Trade and Industry (DTI) identified 10 priority sectors. These are dominant export producers of the country. Among them are the manufacturing of construction materials, electronics, food, giftware and holiday décor, home furnishing, IT services, marine products, motor vehicle parts and components, organic and natural products and wearables. In the succeeding paragraphs, different industry groups are considered. Much of the discussions were taken from Nolasco and DTI studies. Food Products Manufacturing. This industry includes fresh and processed food. Fresh food includes papaya, banana, mango, pineapple and others. Processed food includes coffee, meat, beverages and others. In 2003, food products were 4.47% of the total export of the country amounting to Php1.3 Billion. R&D in this industry is confined to packaging and preservation techniques, employing low-level technology. For example, meat is cured, smoked and dried to prolong its storage life. Raw materials for food manufacturing are sourced locally. In dairy processing however, the prime raw material called dry skimmed milk and sntfinalb.pmd 11 3/2/2006, 3:30 AM  12 PROMETHEUS BOUND butterfat are imported from New Zealand, the Netherlands, Australia and the United States. In addition, packaging materials are also mostly imported. In a 1999 study , the cocoa sub-sector has 13 establishments. Seven are directly involved in the processing of cocoa for industrial and common (chocolate mix) applications. The fruits and vegetables processing sub-sector produces dehydrated fruits, preserved fruits and vegetables, puree concentrates and canned vegetables. The ethnic food and marine organism preparation and processing sub-sector produces food mixes as substitute for common ingredients in dishes and canning of different marine organisms. In the flour-milling sub-sector, 13 flour mills supply 96% of domestic demands of which 90% is consumed by home-based industries. Table No. 4: Capacity of the food manufacturing sector in metric tons. Source: qouting BOI, Industry profile, 1997 and INDUSTRY NUMBER TOTAL OF FIRMS CAPACITY/YR Cocoa 013 0.00 36,000.000 Fruit and Vegetable Processing 135 22, 098,360.500 Ethnic Foods, Marine products, Tuna canning 086 582,772.600 Meat Processing 500 Flour Milling 013 Banana+ 023 27.040 Mango+ 006 0.047 Pineapple+ 002 0.017 Papaya+ 002 1.400 Chemical Manufacturing. The chemical industry is almost nonexistent. Macapanpan describes it as “mere distribution arms of major international chemical industry.” This reflects the dismal R&D activity and innovation. The R&D efforts of local firms are limited to assisting local buyers in incorporating or adapting their chemicals into local buyers’ processes. Garment and Textile Manufacturing. The garment industry accounts for 6.30% of the country’s total exports amounting to $1.8B in 2003. In 2002, the country exported garments to 110 countries, tapping about 1,200 manufacturers, 240 traders and 1,150 subcontractors. The Philippine Textile Research Institute of the DOST is the lead institution in research and innovation. The private firms though, are doing insignificant R&D efforts. In 1999, only 19 big firms had the capability to integrate the multi-process textile production. Electronics Manufacturing. In 2004, semi-conductors and electronic products amounted to US$ 24.411 billion or 67.19% of the total value of Philippine export. This industry includes manufacturing of office equipment, medical and industrial instrumentation, telecommunications, automotive sntfinalb.pmd 12 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 13 electronics, consumer electronics, components and devices and electronic data processing. Semiconductors and electronic products assembly and telecommunication services make up the bulk of the IT industry. The IT industry employment is second to garment and textile employment in the manufacturing sector. In 2003, some 335,000 workers were employed in different electronic firms. The DTI itself characterizes the industry as export-oriented, engaged in assembly and testing and dominated by multinational firms. There are 715 electronics firms of which 72% are foreign-owned, mostly by Japanese corporations. Indeed, the industry has a very limited knowledge input. The electronics and semi-conductors manufacturing is also heavily dependent on imported raw materials. Agriculture Agriculture is the main source of food staples and raw materials for local light manufacturing and handicrafts and other export products. From 1996- 2000 the self-sufficiency ratio for the basic staple food indicated an average of 87.11 percent for rice and 93.89 percent for corn. But productivity in the agricultural sector was very low. From the 4% annual growth rate in the 1960s, it slowed down to 2% during the 1980s and in the last decade, it became 1%. Four sub-sectors compose the sector: crops, livestock, poultry and fishery. The monopoly of agricultural lands by a few landlord families is pervasive in the country. About 70% of the 10 million hectares being farmed are in the hands of a few landowners. The top 0.5% of landowners control 21% and 5% of the total number of landowners control 43% of the total farming area. The majority of the landowning population (67%) owns small plots of seven acres or less. Farmlands with less than three hectares make up about 37.7% of the total agricultural land area. These small parcels of land comprise 79.2% of the total number of individual farms. From 1992 to 1998, about 118,000 hectares were placed under land-use conversion. This was expanded to 6.2 million hectares or 63.3% of the total agricultural lands in the 1991 census. The conversion aimed to increase the export-oriented commercial production of high-value crops, livestock and poultry. Between 1987 to 1991, a total of 11,337 hectares of irrigated rice lands, at an average rate of 2,267 hectares annually, were converted for use of urban settlements and industry. This was shown in the 1991 Department of Agriculture’s Bureau of Soils and Water Management nationwide survey. But the Australian International Development Assistance Bureau estimated a higher conversion rate at 2,300 hectares per year. Crops sub-sector. The Bureau of Agricultural Statistics (BAS), estimated the total harvest area of different crops, like palay, corn, coconut and sugarcane, at about 12.61 million hectares in 1993. This was around 42.03% of the total sntfinalb.pmd 13 3/2/2006, 3:30 AM  14 PROMETHEUS BOUND land area of 30 million hectares. In the 1991 Census of Agriculture, the total farm area of the country was pegged at 9,974,871 hectares, comprised of 4,610,041 farms. A mere 2,296,111 hectares or about 23.4% were regularly irrigated. In 1999, the National Irrigation Administration (NIA) estimated the potentially irrigable area to about 4.66 million hectares with 29% or 1.34 million hectares within the irrigation service area. The Philippine Agricultural Census showed there were about 70 combined numbers of two-wheel and four-wheel tractors for every 1,000 hectares of cropland and less than two combined harvester and thresher. There were about 6 irrigation pumps providing irrigation needs to 1,000 hectares of the total agricultural land. Mechanized farming only exists in pineapple plantations owned by multinational corporations. In general, 80% of agricultural lands are dependent on rainwater for irrigation and farmed manually with plows and farm animals. In 1995, the R&D expenditures of private firms amounted to about $10.5 million or 22% of all agricultural researches conducted in the country. Today, fruit plantations are the most active in R&D spending. The seed industry concentrates on breeding new varieties of hybrid corn, hybrid vegetables and hybrid rice. The company Pioneer has the largest corn breeding program. Other companies like Cargill, Cornworld, Ayala and Asia Hybrids also have corn breeding programs. Table No. 5: Philippine private agricultural research, 1985 and 1995 Source: Research expenditure 1985 1995 Agricultural machinery 305 Unknown, but small Agricultural chemicals 1,657 02,562 Livestock 0,708 01,480 Plant breeding 2,242 01,800 Plantations 1,610 04,680 Total private research 6,522 10,522 Public research expenditure 0,n.a. 37,000 Private research as a percentage of total research 0,n.a. 22% Agricultural gross domestic product 11,054,000 16,319,000 Private research as percentage of agriculture gross domestic product 00.06% 000.06% 1,000 1995 U.S. dollars Except in vegetable and corn breeding, coconut and sugar cane research, agricultural research and development is oriented towards the introduction of foreign technology. sntfinalb.pmd 14 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 15 Significant research activities can be seen in pesticide companies, banana growers, poultry integrators, hog breeders, vegetable and corn seed producers. All pesticides and their formulations and commercial breeds of chicken and hogs and their management systems that include housing design and gadgets are developed abroad. Likewise, all agricultural machineries are of foreign origin while local inventors are active in innovations. Only 46 of 300 companies involved in agricultural production have varying R&D activities. Table No. 6: Types of agricultural firms with R&D activities Source: Type Number Type Number Agrichemical producer 0009 Feed producer 3 Animal breeder 0007 Hog grower 3 Banana fruit producer 0005 Machinery Poultry integrator 0004 fabricators/assembler 1 Seed producer 0004 Grain producer 1 Organic fertilizers producer 0004 Ornamental plant grower 1 Animal health Research foundations 4 product producer 0004 Patents protect technologies for agricultural production like pesticides, growth regulators, fertilizers, feed formula, vaccines, therapeutics, chicken strains, hog breeds, seeds and farm implements, processing methods for crops and livestock and processing machineries. These technologies are imported by wholly owned subsidiaries of multinational corporations. Patents awarded to Filipinos are mostly in agricultural gadget innovations. Table No. 7: Total quantity of patented agricultural technologies from 1948-1995. Source: Agricultural technologies Foreign Local Agrichemicals 1656 024 Agricultural machineries and gadgets 0166 130 Animal husbandry 0146 009 Agroprocessing 0286 080 Total 2254 243 In the sugar industry, before the establishment of the Philippine Sugar Research Institute Foundation, sugarcane researches in the private sector was carried out by three companies: Victoria Milling Corporation (VMC), Hacienda Luisita and Ledesma Foundation. The VMC used to provide for free the technologies, such as on new varieties and information to its contract growers and, for a fee, to other sugar millers and planters. Livestock and poultry sub-sector. The few elite families that also dominate other businesses dominate the livestock and poultry businesses. sntfinalb.pmd 15 3/2/2006, 3:30 AM  16 PROMETHEUS BOUND Their firms include San Miguel Corporation, Purefoods, Swift, Vitarich and General Milling Corporation. They have hatcheries, large commercial pig farms, feed mills, poultry and meat processing facilities and retail outlets. All commercially available hog and poultry breeds are imported. In 1994 to 1997, 28 chicken strains and 19 hog breeds were being grown in the country. Most of them originally came from American international firms such as Arbor- Acres, Cobb-Ventries, Avian Farms and Hubbard supplies poultry breeds, Dallard, PIC, Babcock, Seghorn and Hypor Ralston supplied pig breeds. Purina has also now entered the feed business. Integrated swine and poultry corporations and feed companies conduct livestock research. Researches in beef and dairy though are of less priority. The researches are mostly on improving the management of livestock and identifying the most productive breed, feed additives, pharmaceutical and machinery inputs. Feed companies are focused on identifying low-cost combinations of inputs into processed feeds and eliminating anti-nutritional factors. However, a few separate R&D staff conducts these researches. Feed mills are imported systems acquired either by subsidiaries of multinational corporations or through a technology transfer tie-up. In 1997 there were 322 registered feedmills. Presently, Vitarich and San Miguel Corporation are the only feedmills with 1,000 tons per day production. Science and Technology Education ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ The Philippine educational system have the biggest number of college graduates, compared to other countries, but have one of the smallest number of graduates with science and engineering skills. There is less attraction on science and engineering courses. In the early ‘50s, S&T professionals were trained to identify flora and fauna native to the Philippines for American pharmaceutical companies. Engineers were trained to analyze minerals, map geologic sites and come up with chemical analyses of Philippine natural products that were useful to the colonizers. During the 1980s, emphasis was given in training high school students and out-of-school youths for vocational and technical skills which were direly needed by export-oriented industries. This has not changed up to the present. In 1994 to 2001, using average data, enrollment in engineering averaged at 312,023 students yearly, or about 14% of the total enrollees while the mathematics and information technology have about 7%, natural sciences attract only 1%. The most popular discipline for incoming students in the tertiary education are in business administration and related courses and agricultural related courses, having 30% and 32% of enrollment shares, respectively. sntfinalb.pmd 16 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 17 Recently, the information technology (IT) field has attracted a lot of students. There is a 20% average annual increase of graduation in Computer engineering and other I.T related programs. AMA Educational System alone has about 150,000 students in 200 campuses. But IT professionals eventually end up in the service sector and not as research scientists and engineers. The IT industry includes the manufacture of computer hardware, telecommunication equipment, semiconductors, computer software and services. Currently, call center services are pushed and marketed by the government. In January 2003, the total number of higher education institutions in the country was 1,470. Of these, 1,297 were private schools. Furthermore, private institutions owned 1,383 of the total 2,106 technical and vocational schools. But “private schools prefer not to go into these technical related courses because of their high laboratory requirement that is capital intensive. Non-technical courses are less laboratory-intensive and therefore less capital intensive.” Basic science and education is weak. The introduction of the new Basic Education Curriculum, criticized for the reduced emphasis on the sciences, will worsen the current situation. Moreover, teacher competency is questioned in Magpantay , with the additional description that “students are taught by the least academically inclined people….” This is reflected in the Trends in Mathematics and Science Study 1999 Assessment Results (TIMMS-R 1999). The Philippines ranked 36th among 38 participating countries in the survey. The TIMMS-R measures trends in high school students’ science and math achievements. This hardly improved in the TIMMS 2003 where the country ranked 41st in Mathematics and 42nd in Science out of the 45 countries surveyed. The government has instituted several incentives such as grants and scholarships in science high schools to students entering science and mathematics courses. Enrollment in some basic science and engineering courses in some universities (like the UP) has increased but corresponding support structures such as laboratories, teachers and classrooms have not been augmented. Furthermore, there are not enough available research positions in universities or in industry for new graduates prompting many to go abroad or to be employed differently from their educational training, either as managers, line inspectors or sales personnel. Research and Development ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ R&D Expenditure Based on the UNESCO definition, R&D is any systematic and creative work undertaken in order to increase the stock of knowledge that include sntfinalb.pmd 17 3/2/2006, 3:30 AM  18 PROMETHEUS BOUND knowledge of man, culture and society and the use of this knowledge to devise new applications. R&D affects the economic productivity of the country. R&D further increase the production of services as pointed out by Coronaton (2002) in areas where government and private institutions are engaged in. The type of R&D undertaken provides the basis on how S&T can improve production. The innovations developed and the value-added products that will be rendered would enhance production for economics of scale. R&D is a capital intensive endeavor. Industrialized countries allocate 3- 5% of their GNP to scientific research and development. Table No. 8: R&D expenditures in US$. Data source: [4,14,33] Year GNP at R&D % of GNP 1999 Prices Expenditures 1979 29,552 76.3 0.26 1980 35,219 91.9 0.26 1981 38,434 33.9 0.17 1982 39,278 60.3 0.15 1983 34,081 46.3 0.14 1984 31,580 36.7 0.12 1987-1997 00.2 1998 00.3 In the Philippine, the budget allotted to research and development efforts has hardly changed since the latter part of the 1970s. In 1998, P931.1 million of the government budget or 0.3% of GNP was allotted. This is far below the minimum of 1% standard set by UNESCO for developing countries. The direction of R&D has explicitly emphasized in the progression of applied research advancing more than in basic research, a trend observed from 1989 –1995. This shift towards responding to market-driven needs is reflective of the policy focus in the various DOST plans where the prioritization is on marketable technologies and products needed in the export industry. Four major sectors are involved in R&D activities in the Philippines: higher education (both in private and state universities and colleges), government agencies, non-government organizations and the private industry. Private industry expenditures account only to about 26% of the total R&D spending in 1989 to 1992 [15,17] and hardly changed from 1993 to 1996. During the 1980s the contribution on R&D expenditures of private industries was estimated to be just 10 to 20%. Government agencies’ expenditures account for more than 70% of the total RD expenditures in 1989-1992 and decreased by two percent in 1993 to 1996. sntfinalb.pmd 18 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 19 Table No. 9: Preliminary estimates of national RD expenditures by sector at current prices (2002), in thousand of pesos. Source: Sector 1993 1994 1995 1996 Higher Education 0,380,029 0,419,801 0,457,063 0,531,981 Government 1,036,304 1,131,363 1,433,187 1,742,483 Non-Government 0,155,626 0,170,442 0,207,700 0,249,918 Private Industry 0,547,484 0,599,603 0,730,677 0,879,195 Total 2,119,444 2,321,210 2,828,628 3,403,577 In industrialized countries, the private sector tops government expenditures in R&D. In 1995, private sector spending in the USA and Singapore was 59.4% and 62.5% respectively. In the previous year, South Korea’s private sector had a 84% share in R&D expenditures. By the UNESCO definition, there are three kinds of R&D activities. Basic research is “any original experimental or theoretical work pursued to have new knowledge of the underlying foundations of phenomena and observable facts, without considering any particular or specific application”. Applied research is “any original investigations, undertaken in order to acquire new knowledge but is directed primarily towards a specific practical aim or objective.” And experimental development is “directed to producing new materials, products and devices, to installing new processes, systems and services and to improving substantially those already produced or installed.” From 1989 to 1995, more than half of R&D expenditures in the Philippines were on applied researches and about 42% were on basic researches. This indicated that R&D was directed towards market needs, even with the relative high spending in basic R&D. Development of existing processes and innovation was a low priority. Table No. 10: Preliminary estimates of national R&D expenditures by types of research at current (2001) prices, in millions of pesos. Source: TYPE OF RESEARCH 1989 1990 1991 1992 Total 1,638.70 1,654.74 1,968.68 2,940.55 Basic Research 0,317.50 0,745.91 0,973.09 1,647.17 Applied Research 0,947.43 0,745.91 0,973.09 1,647.17 Experimental Development 0,373.76 0,490.87 0,426.75 579.16 Patent Applications Patent application is a good indicator of the technological innovation capacity and performance of a country. Foreign patent applications usually surpass local patent applications in most countries. In 2003, patent application by Filipinos was only 125 while foreigners submitted 3,440 patent applications. This discrepancy is much bigger than that of South Korea and Thailand. sntfinalb.pmd 19 3/2/2006, 3:30 AM  20 PROMETHEUS BOUND Table No. 11: Patent applications of residents and foreigners in selected countries Source: Country Patents Granted Patents Granted to Nationals to Foreigners 1976 1986 2000 1976 1986 2000 USA 44,162 38,124 - 26,074 32,736 - S. Korea 01,593 458 92,798 01,727 01,436 37,184 Philippines 00/108 082 00/125 00/767 00.755 03,440 Thailand - 060 00/238 - 00.634 05,205 S&T Manpower DOST data indicate that for 1987 to 1997, the average scientists and engineers involved in R&D was only 152 per million, less than half of the UN recommended 380 per million population. The estimated gap in R&D manpower was about 197 scientists and engineers per million population. Moreover, there were only 22 technicians per million population. During the 1990-1997 period, Japan had 5,561 scientists and engineers and 864 technicians per million population. In the same period, South Korea had 2,274 scientists and engineers and 223 technicians per million population. Table No. 12. Total number of R&D personnel. Source: [3,5] Year R&D Technicians Total Personnel and others 1989 9,029 5,180 14,209 1990 9,258 5123 14,381 1991 9,767 5576 15,343 1992 9,960 5650 15,610 1993 11,679 1996 15,243 In a recent survey of researches in state universities and government agencies, it was observed that less than 10% of R&D personnel have PhD degrees in engineering and technology. “This in itself presents a big stumbling block because new technologies available are already in advanced state and requires special technical skills.” S&T manpower is lacking in all sectors and very few are employed. In 1996, 69,375 graduates of the sciences and engineering became part of the 27 million labor force. But only about 9,896 of them were employed in the R&D related work. These employment statistics have barely changed since 1989. Government agencies employ only 37% of them. DOST researchers are about 7% of the total R&D personnel, while the private sector employs 11%. The Magna Carta for the Government Science and Technology Personnel sntfinalb.pmd 20 3/2/2006, 3:30 AM  The State of Science and Technology in the Philippines 21 (R.A. 8439) is yet to provide incentives such as honoraria, share of royalties, hazard allowance and other benefits to government S&T workers. In a recent survey, the number of part-time researchers has been increasing by 11.5% annually, from 1993 to 1996. While the number of full-time researchers with MS and Ph.D degrees has been decreasing. Rather than engaging in productive R&D, MS and Ph.D holders are in consulting work which has a much higher pay. Table No. 13: Full-time and Part-time R&D personnel by sector. Source: Sectors Full Time Part Time 1993 1994 1995 1996 1993 1994 1995 1996 Higher Education 2,961 3,397 3,500 3,865 2,423 2,780 2,863 3,162 Government Agencies 3,294 3,694 3,789 3,993 1,004 1,237 1,291 1,616 Non-Government Organizations 548 629 648 715 153 175 181 199 Private Sector 1,014 1,163 1,198 1,323 283 324 334 369 Total 7,817 8,883 9,135 9,896 3,863 4,516 4,669 5,346 S&T manpower development is closely linked with the current educational system. Assuming a genuine reform in the educational system, it would take 15-20 years “to properly equip and educate the children with the necessary skills and talents before they enter the workforce.” Magpantay describes the educational system as a “mismatch” between the needs and the actual supply. This “mismatch” is seen in the high number of non-technical graduates, yet, local industries “demand” technical and engineering-related graduates [8,9]. The quality of S&T manpower development is also reflected in the Human Development Report’s Technological Achievement Index of the UNDP. In 2000, the Philippines ranked 44th which was below Malaysia’s and Thailand’s ranking. In the Science and Technology Competitiveness, the Philippines ranked 41st. Control and Ownership of Industrial Firms in the Country The ownership and control of the local strategic industries is a gauge on how S&T is being utilized for the benefit of the economy. A conflicting reality is the advancement of technology that does not benefit the majority of the population. The structure of the business in the Philippines comprises small, medium and large enterprises. Micro livelihood enterprises are home- based cottage industries using simple tools and equipment with small management structure varying from 10-199 workers. They comprise 91% of the enterprise in the country varying from furniture-making, handicrafts, sntfinalb.pmd 21 3/2/2006, 3:30 AM  22 PROMETHEUS BOUND food preparation and garments making. A 1% rate is shared by large conglomerates of business owned by wealthy families. Only 10 families control half of the capitalization in the corporate sector. ANALYSIS ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ HE PHILIPPINE ECONOMY has remained agrarian and pre- T industrial. The agricultural sector contributed almost 19.76% to the GNP in the first quarter of 2002, the biggest share in the economy. Import dependence on technology and capital goods for the export-oriented manufacturing of goods remained. In agriculture for example, export earnings from agricultural crops were placed at US $1.30 billion while the value of agricultural imports reached US$2.10 billion in 2001. There is a marked lack of innovation in the industry due to foreign monopoly in technology. The data from the previous section reveal the almost non-existence of heavy industries in the country. Most mineral resources are exported with little or no processing at all. Meanwhile, our S&T education has failed to develop a scientific culture in the country. The educational system may produce yearly one of the biggest numbers of graduates in the region but with only a small number of engineers, technologists and scientists. The number of scientists and engineers in the country also does not meet the UN’s minimum requirement of scientists and engineers vis a vis the population size for a developing country. Thus, the scientific community in the country remains very small. Historical roots At the beginning of Spanish colonial rule, most of the peoples in the Philippines were living in riverine and maritime societies engaged in rice farming, fishing, pottery-making, weaving, mining and metallurgy. Pre- Spanish industries included the manufacture of liquors and vinegars like tuba, basi (rice wine) and others, the production of hides, the manufacture of gunpowder, the making of wax and the making of cotton stockings for trade. These early communities which were mainly societies with elements of both slavery of the patriarchal type and pre-feudal serfdom were trading among themselves and with traders from China, Japan, Vietnam, Malaysia, Indonesia, India and the Arab countries. Among their products were betel nuts, pearls and tortoise shells. Imports consisted of porcelain, silk, bronze gongs and semi-precious stones. The many and diverse cultures of these communities had alphabets, mathematics, calendar systems, herbal medicine, systems of weights and measurement and political systems. Clearly the most distinguishing technological feat of our forefathers was the building of the Banawe Rice Terraces, where rice fields were literally sntfinalb.pmd 22 3/2/2006, 3:31 AM  The State of Science and Technology in the Philippines 23 carved out of steep mountain slopes. The creation of the terraces proves that we have had knowledge in agricultural engineering, hydrology and meteorology, to say the least. Further development of Philippine societies during that time stopped when Spain colonized the Philippines. It forcibly subjugated early Filipinos and established political and economic systems designed to reap the most out of its new colony. As a colonial master, it took control over the land and other resources and dictated how these were to be utilized for the throne of Spain. Thus, control over local production systems shifted from the local communities to the Spanish colonizers who appropriated Philippine raw materials for the Galleon trade. Introduction of technology in production systems were kept to a minimum (crudest). Further developing manufacturing systems within the Philippine colony necessitates huge investments that would drain the coffers of the Spanish throne, then already strained with its engagement in several colonial wars. It was more beneficial for the colonizers to export the raw or semi-processed products of the islands in exchange for finished products from its trading partners. For 300 years, the Spanish colonizers imposed feudalism (landlord-tenant relations) first through the encomienda system, which likewise implemented the political management of towns. Colonial trade flourished with the export of sugar, coconut and other crops to industrial capitalist countries of Europe via the Galleon trade. Later, the hacienda system replaced the old encomienda system. This intensified the production of raw materials for trade during the opening of the ports of the Philippines after the fall of the Galleon trade. The rise of industrial capitalism in Europe from the late 18th century and the decline of the Galleon trade pushed Spain to intensify agricultural production for export that resulted in the rapid expansion of estates owned by the friars and the Spanish natives and mestizos. Instead of improving technological practice, it was more convenient to grab larger tracts of lands to satisfy the increased needs for export. The ever increasing colonial taxation, the arbitrary increases of the land rent by the friars and the rapid expansion of landed estates resulted in social unrest and the 1896 Philippine Revolution. By the end of the Spanish era, industries had been set up in the processing of tobacco for cigars, abaca (hemp) for rope, coconut for copra, oils for paints and sugar milling. The first distilleries for alcohol were likewise established at the end of Spanish rule. Mining activities under the Spaniards were not significant as the colonizers were unsuccessful in penetrating the gold-rich areas of the Cordillera peoples. Under US colonial occupation, the landlord-tenant structure of the hacienda system was maintained. The hacienderos or Filipino landlords prospered under US rule as Philippine agricultural products were exported sntfinalb.pmd 23 3/2/2006, 3:31 AM  24 PROMETHEUS BOUND to the US. In exchange, US goods had free access to the Philippine market. This uncontrolled dumping of surplus goods limited any prospect for domestic industrialization and led the Philippines to a growing dependence on agricultural exportation to the US. This policy of intensive agricultural exportation served to strengthen the hold of a small number of powerful landowners in the countryside. It created a small segment of society that became chief trading and financial partners of US corporations – or what we call the comprador big bourgeoisie who benefited the most from the export- oriented nature of the economy. Thus, while controlling large segments of the commercial and industrial sectors, they are also the landlords who control the vast tracts of land in the countryside. The economy today remains dominated by a few families with huge landholdings and big businesses. Half of the corporate capital is concentrated in the hands of only 10 families. They comprise only 1% of the population but wield economic power over the rest and are the main business and investment partners of foreign corporations. Before granting nominal The ever increasing colonial taxation, independence to the Philippines, the US imposed the Bell Trade Act of the arbitrary increases of the land rent 1946 and later on the Parity Amendment of 1946 and other similar and the rapid expansion of landed laws and treaties that instituted unequal trade relation with the estates resulted in social unrest and Philippines. These allowed American business interests to gain free access the 1896 Philippine Revolution to Philippine resources and markets with little or no technology transfer to the former colony. The nominal independence granted to the Philippines on July 4, 1946 did not result in the establishment of a truly sovereign nation with an independent economy. Obstacles to genuine growth The industries present in the Philippines is composed of light manufacturing, construction, public utility and mining enterprises dependent on imported equipment and raw materials. Most of these are paid for by the foreign exchange earnings of raw-material export and foreign loans. Despite government claims, assembly plants of semiconductor manufacturers and those industries that involve fringe processing do not, in general, generate technology transfer. Until now, the country does not have an industry for capital goods. Heavy and basic industries are non-existent, except for copper processing. Machine- tool industry, basic metal and chemical industries, engineering industries sntfinalb.pmd 24 3/2/2006, 3:31 AM  The State of Science and Technology in the Philippines 25 are yet to be established. Existing industries merely reprocess components from abroad and is wholly dependent on technologies from advanced countries. Vital industries such as power, oil and mining have been liberalized and deregulated. The domination of our economy primarily by the US and its main local partners, the comprador big bourgeoisie and landlords, impedes the building and development of our national industries. It is of course not to their interest to change the largely backward agrarian production systems and develop the local industries, technologies and products. We are therefore not surprised that the past and present administrations in the Philippines are also disinterested in pursuing a genuine industrialization program much less allocate an adequate budget for science and technology development beyond the usual token amounts. Government support through sufficient funding for S&T institutions remains inadequate. The private The economy remains dominated sector and industries have very little participation in S&T activities. by a few families with huge Technologies used in industries are focused only on assembly and testing, landholdings and big businesses. product innovation from other countries’ existing products and Half of the corporate capital is improving management strategies. Technologies are mostly imported. concentrated in the hands The minimal R&D expenditures of private firms in the country reflect the of only ten families. fact that foreign capital in the country does not improve on nor use the full capabilities of science and technology personnel they employ. The attraction for these large firms is in the cheap labor and raw materials available in the country. In general, technology transfer does not happen.. The meager R&D activities result in the lack of opportunities for our S&T professionals. Government S&T institutions could not employ all of them while the lack of industrialization creates no demand for research engineers and physical scientists. Thus, most of them are forced to seek employment abroad, contributing to the “brain drain” phenomena. In 1998, about 25% of deployed OFWs abroad are professionals and technical workers (POEA report, 1998). Many Filipino scientists who have opted to stay in the country meanwhile face low budget allocations for their researches, inadequate compensation sntfinalb.pmd 25 3/2/2006, 3:31 AM  26 PROMETHEUS BOUND and lack of resources and a host of other problems. Still, a lot of them produce research publications that are at par with those in other countries. While these commendable efforts create a sense of self-reliance because of the minimal government support, these are more often than not the specialized rather than the general type of research activities done in most research institutions. Worse, the government has not used these results nor directed their research for the country’s needs. The government’s strategic plans on S&T are not geared towards developing a truly self-reliant economy. These plans have been tailored for the export-oriented and import-dependent economic model. Thus, the government’s strategic plan does not contain efforts to build and strengthen industrialization for domestic production. Instead, it further weakens domestic production through its policy and program of opening national industries to foreign corporations and further deregulating critical base industries. Efforts to build and improve packaging technologies also fit the government thrust of agricultural production for exports. Meanwhile, the training of data savvy, English-speaking “IT” experts fulfills the requirements of off-shore call centers but does nothing to upgrade actual skilled production for our local IT needs. Information and communications technology, with the spread of mobile phones and internet, is largely confined to urban centers. To further exacerbate the situation, the government has never been serious in realizing its policy pronouncements in science and technology as reflected in the steady decrease in budgetary allocations for the DOST and other R&D institutions. To this day, there is little or no technology transfer to the Philippines from its international trade partners. Most technologies being used in the existing manufacturing/industrial sector in the country today are owned by foreign companies. Most of the patents granted in the country are of foreign origin. Intellectual Property Rights laws embraced by the Philippines by large do not protect local scientific endeavors but rather hinder the country in accessing foreign technologies needed for its development. International trade policies supported and adopted by the Philippine government also do not support the development of local industries. After years of implementing “Free Trade Globalization” under the WTO, the country continues to be driven to export more raw and semi-processed materials because of the undeveloped manufacturing systems and the continued dumping of finished goods by industrial countries – to the detriment of course of local production. Agriculture in the country is still not mechanized. Mechanization is undertaken only by big plantations owned by foreign corporations, like Dole and Del Monte. Irrigation in the countryside remains a problem. Employment in agriculture is about 11.1 million or 37% of the estimated total population in January, 2003. But only about 2.4 million or 21.7% are salary and wage sntfinalb.pmd 26 3/2/2006, 3:31 AM  The State of Science and Technology in the Philippines 27 workers and about 26.8% are unpaid family members. The government was never serious in The 5.7 million or 51.5% are all self-employed farm realizing its policy pronouncements in science workers. From 1997 to 2000 the average daily wage rate and technology as reflected in the in agriculture was P154.78 in nominal terms and P110.68 steady decrease of budgetary allocation in real terms. While the agriculture for the DOST and other R&D institutions. sector contributed about 4.03 percent to the country’s total exports and 7.12 percent to the total imports, the country has remained an importer of basic food items. Rice imports for the last five years ranged from 722.40 thousand metric tons in 1997 to 808.23 thousand metric tons in 2001. Heaviest importation was in 1998 – with 2,170.83 thousand metric tons of rice – to avert the supply shortfall brought about by a long dry spell. Monopoly of agricul-tural lands by a few landlord families remains. About 70% of the 10 million hectares of farm lands are in the hands of a few landowners. The top 0.5% of landowners control 21% while only 5% of the total number of landowners control 43% of the total farming area. The