Philippine E-Journals

Economic growth and environmental management in the Philippines

Leandro S. Estadilla

 

Abstract:

Economic growth has been the objective of every administration. Changes in its structure, especially the positive ones, would have a significant effect on a citizen’s way of life. For example, an increase in the wealth of an economy would soon translate into a better standard of living of its citizenry in the future (Mankiw, 2017). This economic phenomenon pushes different economists to formulate policies that would help the economy grow and avoid an economic downturn, recession or worst depression. The Philippines, an archipelago and endowed with natural resources, is showing positive development economically. In recent years, it registered increases in its Real Gross Domestic Product (GDP real) and is now comparable in terms of annual growth experienced by other neighboring ASEAN countries (www.psa.gov.ph ). But this development is sometimes attained at the cost of the environment. Some environmentalists suspect that rampant efforts to achieve economic growth would result to environmental degradation. This is now a worldwide problem experienced even by developed nations. This study sought statistical evidences on the relationship between economic growth (GDP real) and environmental management (Environmental Performance Index (EPI)) in the Philippines. The researcher used panel data from 2000 to 2018 gathered from World Bank (www.data. worldbank.org) and Yale University (www.epi.envirocenter.yale.edu ). This also attempted to determine if the Environmental Kuznets Curve (EKC) is evident in the country. Having applied trend regression analysis, it was revealed that in the case of the Philippines, there is a moderate positive relationship between GDP real and EPI. This result supports the fact that in experiencing growth in an economy, the country will experience an improvement in the development and protection of the environment. It was also found out that over the past two decades, the Philippines experiences EKC. In 2000, environmental protection in the country is low, but it started to increase in 2006 through 2016. However, it declined in the past two years. Thus, it is suggested that in crafting new and continuing existing economic policies, the government should ensure that natural resources are unharmed and further enhancement of existing policies should be considered for the conservation of the natural resources.