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GLOBALIZATION AND LOCALIZATION IN THE 21ST CENTURY: THE CASE OF MINDANAO REGIONS IN THE PHILIPPINES

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GLOBALIZATION AND LOCALIZATION IN THE 21ST CENTURY: THE CASE OF MINDANAO REGIONS IN THE PHILIPPINES Sophremiano B. Antipolo PhD in Urban-Regional Planning and Policy – PowerPoint PPT presentation

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Title: GLOBALIZATION AND LOCALIZATION IN THE 21ST CENTURY: THE CASE OF MINDANAO REGIONS IN THE PHILIPPINES


1
GLOBALIZATION AND LOCALIZATION IN THE 21ST
CENTURY THE CASE OF MINDANAO REGIONS IN THE
PHILIPPINES
  • Sophremiano B. Antipolo
  • PhD in Urban-Regional Planning and Policy
  • University of Sydney
  • Director, Mindanao Center for Policy Studies
  • University of Southeastern Philippines
  • Obrero Campus, Davao City

2
OUTLINE
  • Introduction
  • Spatial Implications and Challenges of
    Globalization and Localization
  • The Current Medium-Term Philippine Devt Plan
    Responding to The Challenges of Globalization
  • Spatial and Urban Development in the Philippines
  • Mindanao Cities In the 21st Century
  • Decentralized Cities Under the 1991 Local Code
  • Conclusion and Implications to Education

3
Introduction
  • Globalization and Localization to what extent
    will these paradoxical and co-existing forces
    determine the course of urban and rural
    planning?
  • What are the challenges they pose upon
    decentralized cities in the 21st century.
  • In this 21st century, matters concerning
    globalization present new challenges for urban
    and rural planners.
  • Indeed, increasing globalization of economic
    activities necessitates a critical re-evaluation
    of existing urban and rural development
    strategies which seek to improve the quality of
    life and to reduce spatial inequalities.

4
  • In the Philippines, with the enactment and
    on-going implementation of the Local Government
    Code, the central challenge becomes twofold
    (1) facing global competition, and (2) improving
    local governance.
  • This is because globalization is accompanied
    with localization and, in the process, tends to
    erode the regulatory power of nation-states.
  • For one, globalization is closely related to the
    localization strategy of transnational
    corporations (TNCs). Under these circumstances,
    TNCs tend to integrate their business activities
    with the local economic environment where their
    establishments are located.

5
  • Thus, globalization and localization signal the
    need to emphasize the active role of spatial
    planning in determining regional and economic
    development policies. In this context, the
    performance of urban and rural economies are
    largely dependent on the capacity and capability
    of local government units (LGUs).

6
SPATIAL IMPLICATIONS AND CHALLENGES OF
GLOBALIZATION AND LOCALIZATION
  • Lee and Kim (1998), alerted us of at least three
    (3) distinctive impacts of globalization on
    spatial configuration and regional (urban and
    rural) development
  • First, the weakening of nation-states reduces
    their ability to control the movement of
    capital, products, and labor across national
    boundaries and to distribute resources to
    achieve territorial equalization.
  • They argued that this situation can lead to the
    intensification of competition among regions and
    localities and are likely to expand spatial
    inequalities.

7
  • There will be greater inequality between cities
    and rural areas and among cities of different
    sizes.
  • In addition, local units will become more
    important economic units operating on a global
    scale rather than the nation-states.
  • Thus, globalization will require a new approach
    to policy-making based on a partnership with
    localities and regions, whose local knowledge is
    far superior to that of the central government
    (Dubford and Kafkalas, 1997).
  • Localization of the economy and decision-making
    mechanism are also closely related to the
    corporate globalization and localization strategy
    of business activities.
  • Transnational corporations have tended to seek
    expansion of their market and production spaces
    on a global scale but their transnational plants
    have tended to be integrated with local business
    environments to make maximum use of resources
    where their plants are located.

8
  • No wonder, Swyngedouw (1992), reiterated Andrew
    Mair (1991) who coined the term GLOCALIZATION
    to characterize this paradoxical co-existence
    of globalization and localization.
  • Also, the weakening of the nation-states has
    tended to expand the role of the private sector
    in local development.
  • Over time, the public sector is increasingly
    dependent on the private sector, even for the
    provision of infrastructure.

9
  • Second, the increase in the mobility of capital
    is likely to increase outflows of domestic
    capital to other countries and inflows of foreign
    capital.
  • The increase in outflows of capital may lead to
    a rapid decrease of production activities in
    industrialized areas, particularly in areas where
    labor intensive industries are concentrated and
    also a reduction in factory movements between
    industrialized and less industrialized areas.
  • Since the industrialization of less prosperous
    areas has greatly relied on the demand created by
    industrialized regions, the increase of capital
    outflows is likely to reduce the potentiality of
    industrial development in the less prosperous
    regions.
  • Furthermore, the increase of foreign capital
    inflows may undermine the self-sufficiency of the
    local economic base, since local economic
    activities controlled by foreign ownership is
    increasing.

10
  • Thus, one of the major challenges confronting
    future rural-urban development is to maintain
    stability and self-sufficiency in the local
    economy during the process of globalization.
  • Third, there is a global spread of a capitalist
    mode of production based on flexible production
    technology.
  • In economic sense, globalization was initiated
    by advanced economies as a response to the crises
    in post-war capitalist production system.
  • This system was based on capital intensity,
    standardization of production and unionized labor
    organization.
  • A new capitalist production system will move
    towards flexible specialization in high
    value-adding activities and specialized producer
    services.

11
  • Rapid changes in technology and market demands
    have created uncertainty and risk in investment
    climate.
  • To adapt to this changing environment, firms
    have increased vertical and horizontal
    disaggregation of their organizations and
    established linkages with other organizations.
  • Thus, in a flexible regime, firms favor business
    environments in which they can easily obtain
    professionals and scientists and establish
    cooperative production systems or networks with
    other organizations.
  • Also, in situations of greater decentralization
    of economic activities, decision-making tend to
    be tied and rooted in a particular place while
    they maintain immediate global contacts.

12
The Current Medium-Term Plan for Mindanao
Strengthening Cities for Global Competition
  • The Philippines recognizes the need to increase
    the capacities of Mindanao urban centers to be
    more competent for global competition.
  • Accordingly, the Development Plan has adopted the
    following strategies (1) full physical
    integration of Mindanao into the global economy
    by infusion of the much needed infrastructure
    support that can consolidate the regions
    potentials into a vibrant economic unit and (2)
    strengthening Mindanaos direct global trade and
    economic links with the rest of the world
    through the implementation of enabling policies.

13
Decentralized Form of Governance
  • The current Development Plan emphasizes that for
    the twin strategies of people empowerment and
    global competitiveness to work, policies
    flowing from these must conform to the guiding
    principles of decentralization, democratic
    consultation, and reliance on non-government
    initiatives (NEDA Board, 2005).
  • Specifically, the development Plan provides
    that In governance, a direct outcome of the
    strategy of empowerment is the principle of
    decentralization and subsidiarity. Lower levels
    of government (regional and local) must be
    allowed to set priorities and decide matters in
    their own spheres of competence.

14
MINDANAO CITIES FOR THE 21ST CENTURY
  • The 21st century is, indeed, expected to be a
    world of cities. The UN projected that about
    half of the worlds population (or over 5
    billion) will be living in urban settlements.
  • Under the current Local Code of the Philippines,
    urban centers are primed to serve as hubs for
    industrial development.
  • In Mindanao, most notable is the urban growth of
    General Santos City which has gained the status
    of a boom city with the influx of both
    population and economic activities.
  • This development may be attributed to the
    dynamism of its local government leadership and
    of the private business sector.
  • In addition, other cities such as Davao, Cagayan
    de Oro, Zamboanga, Cotabato, and Iligan, have
    shown significant economic activities.

15
  • And to further enhance the development in these
    city growth centers, a new dimension to
    interregional cooperation has been established
    the BIMP-EAGA (Brunei-Indonesia-Malaysia-Philippin
    es East ASEAN Growth Area).

16
DEVELOPMENT POTENTIALS OF MINDANAO REGIONS
  • Located in the south, Mindanao is the second
    largest island in the Philippines.
  • It comprises about 102,043 square kilometers of
    land area.
  • Ideally situated outside of the typhoon belt,
    Mindanao enjoys a generally fair and tropical
    climate throughout the year, making it the
    nations leader in agriculture and agri-based
    industries.
  • Mindanao is composed of four administrative
    regions and one autonomous region comprising 27
    provinces and 29 cities.

17
  • Mindanao is the site of one of the worlds
    richest nickel deposits, while accounting for
    three-fourths of the countrys iron reserves and
    a third of its coal resources.
  • Forests still cover two-thirds of the island.
  • Apart from the usual agri-based industries, there
    are heavy industries along the northern coast
    producing sintered iron and steel plates.
  • Mindanao remains to be the fruit basket of the
    Philippines.
  • Coconut and banana exports contribute largely to
    the islands income.

18
  • It registers a manpower reserve of over 10
    million with a functional literacy rate of 94
    percent.
  • Moreover, the island is an ideal blend of vast
    frontiers and highly urbanized centers of
    commerce and industry suitable for the
    development of viable tourism and a business
    climate for investors.

19
MINDANAO URBANIZATION AND URBAN DEVELOPMENT
TRENDS
  • Mindanao has been urbanizing significantly in
    recent years. Pernia et al (2004) noted that the
    urbanization trends of Northern Mindanao and
    Southern Mindanao alone, doubled in the past
    three decades.
  • Outside of the primate city of Metro Manila and
    next to Central Luzon and Southern Tagalog, the
    above two regions posted the third and fourth
    highest urbanization levels at 60.3 percent and
    51.1 percent, respectively.
  • Worth noting are the urban growth rates of all
    the four regions of Mindanao which posted higher
    than the national average.

20
MINDANAO CITIES AS FOCAL POINTS FOR
INTERNATIONAL TRADE
  • Despite the global meltdown, Mindanao contributed
    21.8 percent to the Philippine Gross Domestic
    Product (GDP) and registering a positive 2.7
    percent real growth rate in 2009.
  • Such resiliency can be accounted for by its
    rapidly urbanizing cities, namely Zamboanga,
    Cagayan de Oro, Davao, Cotabato, and General
    Santos.
  • The above-mentioned cities have grown
    dramatically in terms of population size and
    economy in the past three decades.
  • Except for General Santos, all four cities have
    been designated as regional centers, serving as
    focal points for administrative and trade
    relations, as well as centers for health service
    delivery and tertiary education.

21
  • In fact, all of these cities are equipped with
    infrastructure facilities viable for external
    linkages and exchanges such as airports,
    seaports, road network and telecommunication
    system.
  • Over the years, Mindanao experienced the influx
    of industries which are resource-based or
    oriented towards domestic consumption.
  • The top manufacturing activities include (1)
    food and beverage manufacture (2) wearing
    apparel (3) wood and wood cork products (4)
    furniture and fixtures repair (5) industrial
    chemicals (6) rubber products (7) non-metallic
    mineral products (8) iron and steel basic
    industries (9) machinery except electrical and
    (10) cement.
  • As the cities of Mindanao prove to be viable
    centers of trade and external linkages.

22
THE FISCAL OPPORTUNITIES FOR THE CITIES UNDER THE
PHILIPPINES LOCAL CODE
  • Among the local government units, cities are in
    the best position to go beyond basic needs and
    undertake development projects because of their
    broader revenue base and revenue authority.
  • They can levy all impositions by municipalities
    and provinces however, they can only exceed the
    maximum rates allowed for the provinces and
    municipalities by up to 50 per cent except in the
    case of professional and amusement taxes.
  • Cities have the power to raise and use their own
    income which include taxes, fees, and charges.
  • The biggest revenues are usually derived from
    real property tax and business taxes.
  • One of the newest local sources under the Local
    Code is the community tax, replacing the old
    national residence tax, which has to be paid by
    every inhabitant of eighteen years of age and
    over who is regularly employed on a wage or
    salary basis, or who is engaged in business or an
    occupation, or who owns real estate of an
    assessed value of P1,000 or more,

23
  • Fees and charges come from public utilities and
    enterprises owned, operated, and maintained by
    cities within their jurisdictions.
  • Aside from locally generated revenues, local
    government units are entitled to allotments
    coming from national internal revenue collections
    based on the third preceding fiscal year,
    computed at a maximum rate of 40 per cent by the
    third year of the effectivity of the 1991 Local
    Code.
  • The shares are allocated by the type or level of
    the local government unit in the following
    manner provinces _at_ 23 per cent cities _at_ 23 per
    cent municipalities _at_ 34 per cent and barangays
    _at_ 20 per cent.
  • The allocation formula includes population (50
    per cent) land area (25 per cent) and equal
    sharing (25 per cent).
  • Local government units also have a share in the
    proceeds derived from the utilization and
    development of the national wealth within

24
  • their respective areas.
  • These include shares from mining taxes,
    royalties, forestry and fishery charges, and
    other surcharges, interests, of fines in any
    co-production, joint venture, or controlled
    corporation (GOCC) engaged in the utilization and
    development of the national wealth is also
    required to share its proceeds with the local
    government units concerned.

25
CONCLUSION AND IMPLICATION
  • The implications of globalization outlined in
    this Paper called our attention to at least three
    sets of challenges (1) the breakdown of national
    regulatory power is likely to lead to the
    devolution of government functions to local
    governments units thus, there will be
    intensification of competition among regions and
    localities which are likely to expand spatial
    inequalities (2) the increase of the mobility of
    capital and business activities will change the
    comparative advantage for industrial location as
    production space for domestic firms expand across
    national boundaries therefore, it will be a
    challenging task for local governments units to
    maintain the stability and self-sufficiency of
    their local economies in the global economy and
    (3) the spread of the capitalist mode of
    production has also significant impact on the
    changes of regional and local development because
    it will change the spatial structure of economic
    activities such as in production, financing, RD,
    management and the like which will require a
    different set of location factors of production.

26
  • High-tech and information industries require not
    only advanced communication and information
    facilities and specialized service but also high
    quality residential environments.
  • Judging not only from the spatial and
    urbanization trends in Mindanao, but more so from
    its initiative in cross-border cooperation via
    the BIMP-EAGA, it is with optimism that the
    cities of Mindanao are poised to face up-front
    the forces of the globalization in the 21st
    century.
  • The issue concerning intensification of
    inter-regional competition and inequalities can
    be addressed by strengthening urban-rural
    linkages as demonstrated by the key development
    strategies as well as the three sub-strategies
    adopted in the medium-term development plan.

27
  • The implementation of the Peoples Industrial
    Enterprises (PIEs) found parallel trends from the
    successful British new towns experiences and
    Japans technopolis experiences (Masser, 2005).
  • For practical purposes, however, it is best to be
    reminded of John Friedmanns (1998) attempt to
    settle the issue of inequalities in the context
    of balance growth as there can never be an
    absolute balance in quantitative terms across
    space.
  • Our general agreement with this stance brings us
    to postmodern theory in politics and planning.

28
  • As Watson and Gibson (2008) emphasized,
    post-modern politics suggests many possibilities.
  • It defines an end to simplistic nations of class,
    alliances, or urban social movements.
  • It also defines an end to a politics which
    assumes linearity of progress or the
    inevitability of revolution.
  • No one political solution will emerge which will
    be universally just.
  • Power will be continually contested, and new and
    different strategic alliances will emerge at each
    point of resistance.

29
  • Postmodern politics recognizes that there never
    can be one solution which will benefit all people
    in all places for all time. Such an ideal can
    only lead to disappointment.
  • Rather, postmodern politics allows for both
    marginal and mainstream recognizing that
    victories are only ever partial, temporary and
    contested.
  • At the very least, what postmodern theory has
    done is to open up a plethora of ways of thinking
    and acting politically.
  • The challenges brought about by localization
    forces accompanying globalization could be
    contained by the local governments of Mindanao
    cities as substantiated by the overall success in
    the implementation of the Philippine Local
    Government Code.

30
  • Again, following postmodern theory, this success
    story narrative may be contested.
  • Therefore, the complexity of globalization and
    localization forces should continue to position
    the national government but more strongly the
    regional and local government units in Mindanao
    regions of the Philippines to sustain exploration
    of progressive and rational spatial development
    strategies and policies that combine the concerns
    for the economic, social, political,
    environmental, and cultural dimensions of
    urbanization.
  • Finally, the role of improved education (both
    formal and non-formal systems) should remain as
    a continuous policy variable in order to sustain
    the viability of sub-national economies (rural
    and urban regions) in optimizing the benefits of,
    and positioning the Philippines against the
    perils of globalization.

31
  • THE END
  • THANK YOU!
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