Introduction

It is often argued that urban primacy in a developing country is largely a product of its colonial past. The dominance of Metro Manila in the Philippine urban system today continues to feed upon the same forces initiated during the Spanish occupation: Manila still serves as the main link to the world economy and remains the seat of political authority. This colonial heritage may be one of the more formidable obstacles confronting efforts to promote broad-based and balanced regional development in the Philippines.

Although the momentum generated by old global factors continues to influence the landscape of the Philippine economy, new global influences have appeared and are becoming more dominant. The concern is that the strength of new global forces, which build upon a more pronounced international division of labour, greater reliance on international finance, and more emphasis on international trade as the main engine for growth, may only reinforce tendencies towards urban primacy. The argument is that new global forces backed by new communications and transport technology work on the world economy through a system of mega-cities and, in so doing, worsen the unevenness of growth within countries (see chap. 2). Evidence showing the tendency of foreign direct investment to locate in and around national capital regions lends some validity to the hypothesis (Fuchs and Pernia, 1989).

However, more recently in the Philippines, the limited success of regional centres like Cebu in Central Visayas, Cagayan de Oro in Northern Mindanao, and Davao in Southern Mindanao in attracting direct foreign investment and in promoting exports raises a number of questions. With global restructuring, can the regional comparative advantages represented by regional urban centres compete directly at the global level? Can the recent changes in transport and communications technology elevate regional centres above the limits imposed by the existing national hierarchy of cities? The argument being suggested concerns the possibility that global influences may be harnessed to promote balanced growth via intermediate regional centres.

A preliminary examination of the question of whether or not new global factors have an inherent influence towards urban primacy is the main purpose of this chapter. This is done by looking at elements of both global and local influences on recent trends in Philippine urbanization. In particular, this chapter will address three questions: (1) Do global and local factors have different effects on urbanization patterns? (2) How do global and local factors affect each other? and (3) Does the existing pattern of urbanization itself affect the way global and local influences are applied across regions?

In asking the first question, this chapter intends to determine the nature and relative influence of global factors. The second question is raised to qualify answers to the first by determining whether the two sets of influences crowd each other in or out. The third question considers the possibility that global factors may not have an inherent predilection for capital cities but are only observed to have such a tendency as they respond to an existing pattern of urbanization. An underlying interest here concerns the prospect of harnessing global forces to develop secondary or regional urban centres.

The analysis here focuses on recent urbanization trends in the Philippines covering the period between 1980 and 1990. An overview is presented in the next section. Subsequently, an attempt is made to determine how changes in the relative levels of urbanization of the 13 regions in the Philippines are affected by global factors, particularly foreign direct investment and exports, using a simple model developed on the basis of the hypotheses and results presented in previous studies of Philippine urbanization such as those by Pernia et al. (1982) and Herrin and Pernia (1987). The hypotheses underlying the model are tested using three-year, thirteen-region panel data. The empirical specification of the model as well as the results are discussed. Concluding remarks are made in the final section.

Table 8.1 Urbanzation trends in the Philippines, 1948-1990

Source: National Statistics and Census Bureau, Philippine Statistical Yearbook 1991.
a. Numbers in parentheses are percentage rates of change.