The current state of the economy in the Philippines is very intriguing, as will be seen shortly. The average income for a family on one of the islands is $18,935 as of 2012 and extremely poverty-ridden, as opposed to the United States, who boasts an average family income of $51,759. The inflation rate has been relatively stable, ranging from 3.8% to 4.6% over the past four years, with the United States’ inflation rate being at -0.1 currently, which would qualify as deflation. This steady inflation in the Philippines has resulted in instability amongst prices. The country is currently dominated by the private sector, with it contributing an astounding 95% of the country’s GDP.
The currency of the Philippines is the Philippine Peso, which equates to 0.023 USD. In comparison, the average US Income of 52,250 USD would equate to 232,016,125 Philippine Pesos. The Philippines are a part of the Global Banking System. All banks in the country must be licensed with the Bangko Sentral ng Pilipinas. They feature various types of banks, including 36 large, universal banks and 533 small, rural banks. The government tries hard to encourage foreign investment, as they have been continually liberalizing their policies on the matter since establishing the Foreign Investment Act in 1991, comparatively the United States is the world’s largest recipient of foreign investment. The Philippines have relatively high import tariffs, with duty rates varying from 0% all the way to 65% and an average of 10.5%. This is in comparison to the United States, whose variance is 0-37.5% and an average of 5.63%, but they do both exclude electronics from duty rates. In addition to the high duty rates, the Philippines also imposes a 12% before-Duty sales tax on imported goods, something not seem in America. The earnings from Exports have increased 15% over the last year, with France and Germany being the greatest contributors to this increase. Their top three exports are textiles, footwear, and headwear, whereas the United States’ are machines, electronics, and oil. Monopolies are also more prevalent in the Philippines than the United States, as Anti-Trust laws are just starting to gain momentum there. The telecommunications industry has a monopoly in the Philippines, along with the garlic, electric/utility, and tobacco industries. The United States has monopolies in the soybean and utilities industry, however the utilities are more locally-based monopolies than national.