Economics 101: Pre-Colonial Philippine Natives Already Did Business with Foreigners

Art by Hugo Yunzon

It's finally August or Buwan Ng Wika (Month of the Language), though it may be better to call it Buwan Ng Kultura (Month of the Culture). Buwan Ng Wika programs tend to focus more on the uniqueness of several types of Filipino people. What I recall back in my high school days (late 1990s) is how I was asked to play an "American" in a Buwan Ng Wika program. There were also other people asked to portray the Chinese traders, Arab traders, Indian traders, and the Japanese occupation. It would be good to do a review of the pre-colonial Philippines. The name Philippines was derived from the Spanish king, King Philip. Back then, the natives were called Indios which sounds very similar to Indonesia. Yes, most Filipinos are either Malay or Indo. A look at the Indonesians and Malaysians would have one mistake them for Filipinos. A note is that the Chinese population there usually speaks Hokkien. 

From Purdue Filpino--here's some basic information about Filipinos trading with the Spanish. Unlike the Arabs who once occupied Mindanao (therefore explaining why Islam is practiced strongly there), China never occupied the Philippines, nor did the Chinese traders seek to take over it: 

Between the 10th and 16th centuries and before the Spanish colonization, Chinese traders sailed to the Philippines. They brought porcelain and silk, in exchange for beeswax, deer horn and trepang(sea slug). The trade with China was the beginning of a major influence and contribution within the FIlipino culture. One major influence that the Chinese contributed within the culture was culinary arts. Some culinary techniques that the Filipinos were taught include sauteed dishes, rice cakes and noodle dishes(like Pancit!). In addition, the Chinese way of family structure also heavily influenced the traditional Filipino family structure. The traditional Filipino structure is very rigid, authoritarian, and uses Chinese-based nomenclature. The eldest son is called Kuya, and the eldest daughter is referred to as Ate. Both kuya and ate have authority and responsibility over their siblings.

The Bangko Sentral ng Pilipinas also gives this interesting trivia on Filipino trade history:

Long before the Spaniards came to the Philippines, trade among the early Filipinos and with traders from the neighboring lands like China, Java, Borneo, and Thailand was conducted through barter. The inconvenience of the barter system led to the adoption of a specific medium of exchange – the cowry shells. Cowries produced in gold, jade, quartz and wood became the most common and acceptable form of money through many centuries.

Since the Philippines is naturally rich in gold, it was used in ancient times for barter rings, personal adornment, jewelry, and the first local form of coinage called Piloncitos. These had a flat base that bore an embossed inscription of the letters “MA” or “M” similar to the Javanese script of the 11th century. It is believed that this inscription was the name by which the Philippines was known to Chinese traders during the pre-Spanish time.​

The FilipiKnow website shares this, which proves that doing business with foreigners is different from imperialism: 

We’ve all been taught that before the Spanish galleon trade, the pre-colonial Filipinos had already established trading and diplomatic relations with countries as far away as the Middle East.

Instead of cash, our ancestors exchanged precious minerals, manufactured goods, etc., with Arabs, Indians, Chinese, and other nationalities. Many foreigners permanently settled here during this period after marveling at the country’s beauty and people.

Out of the foreigners, the Chinese were most amazed at the pre-colonial Filipinos, especially regarding their extraordinary honesty. Chinese traders often wrote about the Filipinos’ sincerity and said they were one of their most trusted clientele since they did not steal their goods and always paid their debts.

Out of confidence, some Chinese were known to leave their items on the beaches to be picked up by the Filipinos and traded inland. When they returned, the Filipinos would give them back their bartered items without anything missing.

Philippine Anti-Fascist League

That would be a distant cry from what the now-defunct PAFL page would say (meme above). It'd be stupid if people say that the Philippines never had contact with foreigners until the Spanish colonizers came over. Back then, Spain was a world power conquering other nations. However, the trading acts between the Filipino natives with other foreigners were an act of investment. Even basic dictionary terminologies will tell you that foreign investment isn't foreign invasion (read here). Chinese merchants traded with Filipino merchants. The Chinese merchants weren't agents of the Chinese emperor, and neither did the Chinese emperor seek to turn the Philippines into a Province of China back then. Right now, I have every right to be weary with trading with China due to the reign of President Xi Jinping. Otherwise, the Philippines can welcome trading with other countries such as its co-members in ASEAN and APEC. 

It's just plain ignorance to say investments are automatically invasion. There can be invasions disguised as investments. However, investments aren't automatically invading. The Philippines can allow FDIs to invest in the Philippines, without the need of 60-40 with a local Filipino partner. FDIs will still have to follow rules if they want to do business in the Philippines. Beside,s I doubt any ancient manuscript will prove that Filipino natives required 60-40 when they did business with foreign merchants.