The impact of the Gulf Crisis on the Philippine economy

Abstract

It seems that every ten years an oil shock comes with profound impact on the economies of oil importing developing countries The last oil shock was particularly disruptive to the Philippines since it came when the economy was struggling to overcome a serious budget deficit and the external debt problem It also occurred in time of natural calamities such as a prolonged drought, a devastating typhoon and earthquake, which visited the Philippines one after the other and crippled many of its productive assets This study analyzes the impact of the recent Gulf crisis on the Philippine economy and reviews the measures adopted by the government in response to that crisis. Its specific aims are 1 To describe the current state of the Philippine economy and the energy policy of the government, 2 To document and describe In detail the policy measures adopted by the government to deal with the impact of the Gulf crisis 3 To assess the impact of the Gulf crisis on the balance of payments employment, and the budget, 4 To perform, simulations, using the PIDS NEDA Macroeconometric Model for both direct and indirect impact on important macroeconomic variables under different scenarios, and 5 To recommend steps/approaches for both the government and the international organizations for dealing with the adverse impact of the Gulf crisis or similar future situations on the Philippine economy