Industrialization and Economic Development

What is Industrialization?

• It is the transformation of raw materials into finished products through the use of machines

Role of Industry in the Economy

• It has the ability to produce different products

• It has the capacity to give employment

• It has the capacity to adjust to the changing tastes of the consumers

• It helps the economy earn foreign currency which we use to finance our imports

Components of the Industrial Sector

1. The Mining Sector “Mineral products produce

food, shelter and income. The price and availability of these mineral commodities have a tremendous influence on the nation’s productivity and on our standard of living”.

Components of the Industrial Sector

2. Manufacturing Sector -is defined as the mechanicalor chemical transformation ofInorganic substances in to newproducts, either by powerdriven machines or by handin factories or in the workers’home.

Components of the Industrial Sector

3. Construction -Adequate and effectiveinfrastructure such as farmmarket and feeder roads,feeder ports, irrigation andrural water supply

Components of the Industrial Sector

4. Energy Sector Its objective is to ensureaffordable, competitive andreasonably-priced energysupply through socially andenvironmentally compatibleenergy infrastructure

Components of the Industrial Sector

5. Water Providing a clean, potable watersupply to every Filipino is theresponsibility of the ff agencies: LocalWater Utilities Administration(LWUA), Dept. of Interior and LocalGovernment (DILG), MetropolitanWaterworks and SewerageSystem, Dept of Public Works andHighways, National WaterResources Board

Challenges Facing the Industrial Sector

Skills Gaps – There is a shortage of workers who have skills and experience that meet the job requirements.

Challenges Facing the Industrial Sector

• Environmental Issues – The environment is sacrificed in the process of industrialization and modernization.

Best managed companies in the Philippines

1. Ayala Corporation 2. Philippines Long Distance Telephone Companu3. Ayala Land 4. International Container Terminal Services, Inc.5. Bank of the Philippines Islands6. Globe Telecom7. Aboitiz Power8. Megaworld 9. Manila Power10. SM Investments

Nationalization of Retail Trade

Republic Act No. 1180 or the Retail Trade Nationalization Act

-this law prohibited aliens from engaging directly or indirectly in retail trade

Liberalization of Retail TradeRepublic Act No. 8762 known as the Retail

Trade Liberalization Act

-To encourage Filipinos and foreigners to invest in the retail industry, and to promote consumer welfare with lower prices and globally competitive goods through the liberalization of trade

Liberalization of Retail TradeRepublic Act No. 8762 known as the Retail Trade Liberalization

Act -Reserved to Filipinos- businesses with capital less than

$2,500,000-For enterprises with capital of $2,500,000 but less than

$7,500,000 foreigners will be wallowed up to 100% ownership provides that the investments shall not be less than $830,000

-For businesses engaged in luxury products with a capital of $250,000 foreigners will be allowed 100% ownership

Agencies that Promote the Trade and Industry Sector

• Department of Trade and Industry

- Tasked to create a business-friendly environment and strengthen linkages between

and among the sectors of trade and industry.

Agencies that Promote the Trade and Industry Sector

• Board of Investments- Engages in promotional

activities supporting its motivation to make the country the e-commerce services hub of Asia and making it attractive to investors.

Agencies that Promote the Trade and Industry Sector

• Philippine Economic Zone Authority

- It was established to encourage investors to invest in the economic zones and manage zones according to international standards

Agencies that Promote the Trade and Industry Sector

• Securities and Exchange Commission

-It is tasked to supervise the selling and buying of corporate stocks and securities that are issued in the country.

- It requires all companies to submit annual reports on their performance

- It also gives information on the selling of bonds and securities.

Agencies that Promote the Trade and Industry Sector

• Bureau of Micro, Small, and Medium Enterprise Development.– This agency helps the micro,

small and medium enterprises in the development of their technology, they also give financial assistance and training.

Agencies that Promote the Trade and Industry Sector

• Cottage Industry Technology Center (CITC)– They give seminars to those

who wants to enter the industry or have a business like; making Christmas decors, jewelry, shoes and the likes.

Role of Agriculture and Industry• Source of livelihood– Provide employment in farming,

livestock, mining, manufacturing and food processing.

– A country with a poor system of agriculture cannot support a big and growing population which is dependent on agriculture and industry.

Role of Agriculture and Industry• Source of food supply and raw

materials for economy– The agricultural sector is the

source of food, it also provides a rich supply of industrial raw materials.

– For a developing country to take off, it requires a continuing growth in the supply of materials from agriculture.

Role of Agriculture and Industry

• Source of earnings in foreign trade– Many countries depend on

both agricultural and industry for their exports.

– For the developing countries the bases for international trade is the agriculture and industry.

Role of Agriculture and Industry

• Development of Technology – From the different means

of producing the goods, a technological change which will yield better results might be discovered.

Role of Agriculture and Industry

• As a source of resource transfer.– As the economy of a country

develops, the sectors of agriculture and industry play a vital role by contributing additional resources.