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close this bookTechnological Independence The Asian experience (UNU, 1994, 372 pages)
close this folder5 The Philippines
View the document(introductory text...)
View the documentThe historical roots of technological dependence
View the documentS&T policy: rhetoric and reality
View the documentCase-studies
View the documentCase-study results
View the documentTechnological dependence: nature and consequences
View the documentS&T in the Philippines: inputs and outputs
View the documentThe vicious circle paradigm
View the documentThe anatomy of technology transfer
View the documentThe search for models: learning from Asia
View the documentVision and commitment
View the documentToward a leap-frogging strategy
View the documentNotes
View the documentBibliography
View the documentAppendix 1
View the documentAppendix 2. major achievements of S&T in the Philippines

Toward a leap-frogging strategy

The Philippines has been left behind economically and technologically by almost all its neighbours in the East Asian and South-East Asian regions during the past three decades. This suggests that the vicious cycle of S&T backwardness and economic dependence has not been broken by previous government science administrators.

With the appointment in June 1986 of a new Science Minister under a new administration and the reorganization of government science agencies under the new Department of Science and Technology (DOST) in January 1987, new science and technology policies have been formulated and new government agencies have been established. It remains to be seen whether an all-out drive to break the vicious cycle will be carried out by the new DOST; our previous analysis has shown that it takes much more than S&T policy statements and reorganization to achieve this. An entirely new national development strategy is needed to overcome technological and economic dependence.

Our initial assessment of the new government of the Philippines, however, does not evoke our optimism for national self-reliance in S&T, as the government's economic development strategies and policies do not differ much from those of the previous regime. In order to liberate the country from its economic and technological dependence' the government needs to pursue new and bold economic and technological policy directions that must attempt, first of all, to break the vicious cycle of technological backwardness and dependence.

Since the vicious cycle stems from the interrelated problems of (1) the weakness of the country's S&T potential, (2) the lack of effective demand for endogenous R&D and technological innovations, and (3) the almost total dependence of the country on the importation of technology for production, it is obvious that these three problems have to be tackled and overcome simultaneously (see figure 15).

A national strategy to break the vicious cycle is outlined in the conceptual model shown in figure 17. This includes the following essential components:

1. Accelerate massive development of the country's S&T potential through the expenditure of at least 1 per cent of GNP on the development of advanced S&T manpower, infrastructure, and information resources and the implementation of selected R&D projects.

2. Increase the effective demand for endogenous R&D technological innovations through fiscal policies and legislative acts that would make local firms, whether private or government-controlled, invest a certain percentage (at least 1 per cent) of their net income before taxes on endogenous R&D.

3. Initiate strategic management of technology transfer that would link the importation of selected foreign technologies with endogenous R&D and innovation projects for the purpose of facilitating national technological mastery of these selected technologies. The central goal of this proposed national strategy would be the technological mastery of those selected technologies that are strategically important to the Philippine economy in its relationship with the rest of the world.

Earlier, the various technologies were categorized into first-wave' second-wave, and third-wave technologies. It was pointed out that the

Fig. 17. Breaking the vicious cycle of technological dependence

Philippines has reached the replicative and even innovative stages of technological capability in most first-wave technologies, but that it is still largely at the operative and adaptive stages in most second-wave technologies, and at the pre-operative and operative stages in most third-wave technologies.

For the past two decades, the Philippine national debates on technological choices have been dominated by two schools of development thought: the "Countryside Development" school and the ´'Nationalist Industrialization" school. The former, arguing that agricultural development must precede industrialization, advocates the adoption of labour-intensive, employment-generating first-wave technologies. The latter, on the other hand, insists on following classical industrialization programmes and promoting second-wave technologies.

Under the present government, the "Countryside Development" school has gained ascendancy over the "Nationalist Industrialization" school, and the development of the agricultural sector has been included in national development plans. In fact, the "Countryside Development" philosophy was even incorporated into the new Philippine Constitution of 1987. Hence, industrialization will now be given a low priority, while agriculture-based, labour-intensive, export-oriented economic development will be pursued.

In justifying the "Countryside Development" strategy, government economic policy makers invoke the "law of comparative advantage," arguing that the country's comparative advantages lie in its abundant cheap labour, natural resource endowments, and agricultural products. Thus, they have been promoting the export of cash crops, garments, handicrafts, dolls, furniture, copra, prawns, etc.

What has been realized is that comparative advantage is not absolute and permanent but subject to technology. What has been ignored is that, today, comparative advantages are increasingly determined by scientific and technological knowledge. For example, the development of synthetic or genetically engineered products in advanced countries has determined the comparative advantages that used to be enjoyed by certain resource-rich third-world countries, while the increasing automation and robotization of production are now beginning to erode the comparative advantages of labour-intensive manufacturing in third-world countries.

In fact, three of the industries which we investigated in this project have become "sunset industries" for the Philippines because of high-technology developments. The international market for copper has been dwindling because copper wires are now being replaced by optical fibres in communication systems. New substitutes for coconut oil have been developed, resulting in the shrinkage of the export market for coconut oil. The use of fully automated systems for the fabrication of highly integrated, high-speed, sophisticated chips has started reversing the trend of setting up labour-intensive semiconductor assembly facilities in third-world countries.

What is very clear is that whatever comparative advantages the Philippines used to enjoy in the recent past owing to its natural resources or cheap labour are fast being eroded by third-wave technologies. It is also obvious that, in the twenty-first century, the economic viability of nations will be determined largely by mastery of third-wave technologies.

The current national debate between the proponents of first-wave technologies and those of second-wave technologies is, therefore, ludicrous and pathetic at a time when almost all the rest of the countries in East and South-East Asia are trying to master third-wave technologies in preparation for the twenty-first century, which is just a few years away. To pursue either a first-wave or a second-wave development strategy is to condemn the country to economic obsolescence and increased dependence.

In the face of high-technology developments that are already affecting the national economy, the Philippines can no longer afford to ignore the third-wave technologies that are radically reshaping human civilization. The only choice left for the country in the remaining years before 2000 is whether to start mastering these technologies to its economic advantage or to let high-tech development undermine its economic survival in the next century.

While third-wave technologies pose threats to the Philippine economy, they also offer opportunities for the country's economic development because of their knowledge-intensive and capital-saving characteristics. For example, the abundance of highly educated manpower in the Philippines could be turned into a comparative advantage in areas like software development, which for some time will remain a labour-intensive and skill-intensive activity. Biotechnology could also be used to lessen dependence on imported agricultural inputs and produce high-value crops, while micro-electronic instrumentation and CAD/CAM systems could be utilized to improve certain existing manufacturing processes.

The strategy of breaking the vicious cycle of S&T backwardness and economic dependence and gaining national technological mastery of selected third-wave technologies is what we propose for the Philippines. An appropriate term for this strategy is technological leapfrogging, because it seeks to bypass the second wave in order to (1) modernize Philippine production technologies, (2) provide a competitive edge to the national economy, and (3) bridge the technological gap between the Philippines and the advanced countries.

The essential feature of the strategy of technological leap-frogging is the linkage of selected transfers of third-wave technologies with endogenous R&D and technological innovations for the purpose of building up adaptive, replicative, innovative, and ultimately creative capabilities in these technologies.

A specific example of a technological leap-frogging approach would be the bypassing of the technology of second-wave, steel-based machine tools in favour of mastering the technology of third-wave industrial lasers for use in cutting, drilling, welding, annealing, and marking materials. The basic idea is to master, whenever feasible, the state-of-the-art technology rather than to invest money and efforts in acquiring competence in the corresponding obsolete technology.

Technology mastery refers to the innovative and creative levels of technological competence. In the example of industrial lasers, technological mastery would be indicated by the ability to improve the design and performance of existing industrial lasers or to invent and fabricate entirely new and better laser systems.

In our view, the term "technological mastery" is preferable to "technological self-reliance," because the latter is open to the misinterpretation of being either equivalent to technological autarky (i.e. the development of a technology from exclusively indigenous resources) or limited only to replicative levels of technological capability.

Besides, technological mastery connotes not only innovative and creative technological competence and state-of-the-art S&T knowledge and skills, but also the idea of "socio-economic command of technological development" -that is, the ability of the entire society to control the direction of technological innovations so as to maximize their social benefits and minimize their negative effects. In this sense, national technological mastery of third-wave technologies would imply democratic, social consensus in the selection, assimilation, development, application, and diffusion of high technologies so as to ensure a better future for everybody in the society.

The successful implementation of the strategy of technological leap-frogging, leading from the vicious cycle of S&T backwardness and dependence to national technological mastery of the third wave, is an extremely difficult national project that requires the following:

1. Strong political leadership that is fully committed on a long-term basis to this national project.

2. An effective, internationally linked national system for S&T and economic scanning, forecasting, prospective assessment, and intelligence.

3. A strong S&T system which is highly competent in adapting, replicating, and improving foreign technologies and creating new science and technology.

4. A national economic planning and management system that can formulate and implement integrated national technological and economic plans and policies in anticipation of opportunities and threats from new technological developments.

5. An economic system that is self-reliant, technologically oriented, innovative, internationally competitive, and possessed of a high degree of social equality.

6. An educational system that can anticipate and assess various probable futures and provide students with self-learning capacities for adapting to a rapidly changing society.

7. A national culture that places a high value on learning, creativity, originality, innovativeness, productivity, quality, and excellence. Furthermore, all these elements must be coordinated and integrated with one another.

In short, a radical overhaul of Philippine society is required if the strategy of technological leap-frogging is to be pursued successfully. Unfortunately, the prospects for this necessary social transformation are dim at present, for, notwithstanding the 1986 February Revolution that overthrew the Marcos dictatorship, the new Aquino government seems to lack long-term national vision for the country beyond national economic recovery.

Nevertheless, inspired by the successful experiences of Japan, the Soviet Union, China, and the Republic of Korea in technological leapfrogging, we believe that a national programme to master third-wave technologies could still be carried out in the Philippines if future national leaders could be convinced that it is imperative for national development.