Neoliberalism in the Philippines

Abstract

Neoliberalism’s policy prescription is an almost exclusive reliance upon the market as the institution to be used for resource allocation and the goal of neoliberalism is to increase foreign investment (McCarthy 2007). Since the state is presumed to be inefficient, neoliberalism eschews any role for the state in responding to the needs of the populace (McCarthy 2007). For example, wages can be kept inordinately low to lure outside corporations and businesses to invest in the Philippines. Under the auspices of neoliberalism, major multilateral agencies such as the Asian Development Bank, World Bank, International Monetary Fund, and World Trade Organization, ‘have become increasingly aggressive in their willingness to look inside countries, evaluate their governance structures, and recommend both sweeping and highly specific changes’ (McCarthy 2007, p. 40). These multilateral agencies have called for foreign investors in developing countries to be guaranteed parity rights and protections against expropriation, and to be allowed to freely move investment funds and profits into, and out of, a country as they wish (McCarthy 2007).