METROPOLITAN Manila is so dominant in the Philippines’s political, economic and cultural life that it has been sarcastically called “Imperial Manila” by commentators from other parts of the country. Consider: In 2013 Metro Manila contributed 37.2 percent of the country’s gross regional domestic product, while the next leading growth poles—Region 4A (Cavite, Laguna, Batangas, Rizal and Quezon provinces, or Calabarzon), Region 3 (Central Luzon), Metro Cebu and Metro Davao—only contributed a total of 35.4 percent. Metro Manila is also the country’s seat of government, as well as the hub of its social and cultural life.
What raises the tempers of these commentators, however, is less the National Capital Region’s economic, political and cultural preeminence, and more its demands on the national budget. Metro Manila swallows up something like one-half of national expenditures, leaving very little for everybody else.
A bit of agglomeration economics will help make the matter understandable. The major portion of the budget goes to Metro Manila, simply because this is where the need for it is greatest, and because this is where the huge and not-so-huge corporations of the industrial and commercial world have “agglomerated.” Their clustering together enables them to reap greater benefits—of decreasing costs, for instance—than if they are standing alone. Their requirements for power, water, transport and communications facilities and networks, among other things, are simply enormous.
The multitude of workers they attract form part of the agglomeration. The need of these people for health, educational, social, cultural and recreational facilities also seems limitless.
While many of these facilities and networks will be provided by the private sector through the normal workings of the market, some must be provided by the public sector, and this requires appropriation from the government budget.
Is there no end to agglomerative expansion? There is. Air and water pollution, traffic gridlocks and crowd congestion, to mention a few of the banes of urban life, can bring agglomeration to a halt. People and their organizations may refuse to be victimized by these disamenities and decide to move to more congenial areas. This has happened to many great agglomerations in various parts of the world, and it appears that this is now beginning to happen in Metro Manila.
Commentators and local government officials need not wait for the breakdown of agglomeration forces of Metro Manila or rely on the power of sarcasm to shift the center of gravity to their own communities. Local governments can begin attracting the forces of agglomeration latent in their surroundings, nearby and distant, by improving the physical conditions of their communities—through urban planning, for example—and highlighting profit-making opportunities in their communities by holding trade fairs, business conferences, seminars and other related activities. Once they do this, the forces of agglomeration are sure to channel themselves to these new growth areas.
Image credits: Jimbo Albano