Philippine Conglomerates: Their Role in Promoting Inclusive Development

Abstract

As has been the case in many developing countries, Philippine conglomerates have historically played an important role in national development. However, the extent to which they contribute to inclusive economic growth remains largely unmeasured and more so, unappreciated. It is in this context that our paper examines the performance and programs of fifteen large Philippine conglomerates whose value-added contribution to the economy was 6% of the gross domestic product in 2018. Note that these private firms are also the largest purchasers of intermediate goods and services, consuming 14.6% of the country’s total intermediate inputs. While many government support programs are still needed, there are available opportunities for conglomerates to expand or redesign existing “inclusive business” models, particularly with respect to micro, small, and medium enterprises. Recognizing their past efforts as well as their potential to do more, we show that these large business groups have become vital partners of the government for its economic and development agenda. However, the government is best advised to establish a national industrial policy for growth and innovation in order to further encourage these conglomerates to implement programs that generate greater dividends for society while simultaneously achieving their own corporate objectives.