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Article XII, 1987 Philippine Constitution

NATIONAL ECONOMY AND PATRIMONY

Section 1. The goals of the national economy are a more equitable distribution of opportunities,
income, and wealth; a sustained increase in the amount of goods and services produced by the nation for
the benefit of the people; and an expanding productivity as the key to raising the quality of life for all,
especially the under-privileged.
The State shall promote industrialization and full employment based on sound agricultural
development and agrarian reform, through industries that make full and efficient use of human and natural
resources, and which are competitive in both domestic and foreign markets. However, the State shall
protect Filipino enterprises against unfair foreign competition and trade practices.
In the pursuit of these goals, all sectors of the economy and all regions of the country shall be
given optimum opportunity to develop. Private enterprises, including corporations, cooperatives, and
similar collective organizations, shall be encouraged to broaden the base of their ownership.

THREE BASIC DIRECTIONS:


1) Dual goal of dynamic productivity and a more equitable distribution of what is produced
2) Balance between industrialization and agricultural development
3) Protective of things Filipino

Three-folds goals of the national economy

1) Equity- More equitable distribution of opportunities, income and wealth.


One important aid in promoting equity is the control of monopoly and the prevention of
unfair competition.
2) Growth- Sustained increase in the amount of goods and services produced by the nation for the
benefit of the people.
Economic growth is conventionally measured by the increase of the gross domestic
product(GDP) which is the estimated total value of all the goods and services produced
by the economy.
3) Productivity- An expanding productivity as the key to raising the quality of life for all especially
the unprivileged.
Productivity is the ability, capacity or degree of effectiveness for making greater output
out of every unit of input employed.

STRATEGIES TO ACCOMPLISH GOALS


In the pursuit of the goals of the national economy, the Constitution mandates the State in Section 19 of
article II and in Section 1 above, aside from other provisions.
1. To develop a self-reliant and independent national economy effectively controlled by
Filipinos.
In providing for economic self-reliance, the intent is not to pursue a policy of economic seclusion
from the international economic community.
Self-reliance simply means that the Philippines must have the ability to cope with its economic
problems or to implement its development programs by the use of its own resources with a
minimum of dependence from foreign governments, inventors or financing institutions for loans
and investments.
Independent economy. - The national economy must be free from undue foreign control or
intervention.
Economy effectively controlled by Filipinos. - The principal responsibility for development
belongs to Filipino citizens. They must be the principal determinants as well as the chief
beneficiaries of economic progress

2. To promote industrialization and full employment based on sound agricultural


development.

The policy does not mean a hard-bound rule that agricultural development must have
priority over industrialization. What is envisioned is a flexible and rational relationship
between the two as dictated by the common good.
Agricultural development must be pursued not at the expense of industrialization but on a
complementary basis to insure the growth of both.
An important aspect of industrialization is that it generates a high level of employment
Agriculture is not the only main source of livelihood.
agricultural development is important to a low-income country like the Philippines with a
large agricultural base.
agrarian reform takes on a central position as component of policies for raising
agricultural productivity.
agriculture as a source of export earnings even assists industry in providing its foreign
exchange needs.
all the "tiger economies" of East Asia have anchored their industrialization on agricultural
modernization.

3. To protect Filipino enterprises against unfair foreign competition and trade practices.
To protect both the Filipino consumer and the Filipino producer.
The Filipino consumer must be protected against a flood of low-quality products.
The Filipino producer must be protected from unfair foreign competition and trade
practices
The Government can declare as unfair anything that hurts Filipino enterprises.
The protection can come in form of Tariffs, quantitative restrictions, or even total ban of
imports in certain cases.
The constitution rejects the principle of absolute protectionism also it would invite retaliatory
measures by other countries.

4. To give all economic sectors and regions of the country optimum opportunity to develop;
and

5. To encourage private enterprises, including corporations, cooperatives and similar


collective organizations to broaden the base of their ownership.