Economic history of the Philippines (1965–1986)

The economic history of the Philippines during the Marcos regime (1965-1986) was a period of economic stress.

The first years of Ferdinand Marcos' administration continued the growth of previous administrations of the Third Philippine Republic, peaking at nearly 9 percent in 1973 and 1976. However, in the later years, the worst recession in Philippine history occurred, with the economy contracting by 7.3% in both 1984 and 1985.

The dramatic rise and fall of the Philippine economy during this period is attributed to the Marcos administration's use of foreign loans (debt-driven as opposed to productivity-driven growth).

Philippine Gross Domestic Product (GDP) grew from $5.27 billion in 1964 to $37.14 billion in 1982, before declining to $30.7 billion in 1985. This included growth from $8 billion in 1972 to $32.45 billion in 1980 – 6%/year, its best results since 1945. The economy grew despite global oil shocks following the 1973 and 1979 energy crises.

However, its policy of establishing monopolies resulted in significant income inequality, corruption, and capital flight. Average monthly wage income fell by 20% from 1972 to 1980. By 1981, the wealthiest 10% of the population was receiving twice as much income as the bottom 60%. Poverty grew from 41% in the 1960s to 59% in 1986. The unemployment rate increased from 3.9% in 1975 to 12.6% in 1985.

The external debt of the Philippines rose more than 70-fold from $360 million in 1962 to US$2.3 billion in 1970 to US$17.2 billion in 1980 to $26.2 billion in 1985, leaving the Philippines one of Asia's most indebted nations. At the end of 1979, the ratio of debt to GDP was about the same as South Korea.

During his reign, the peso fell from 3.9 to 20.53 to the US dollar.