3. ت Early Filipinos were fishers, hunters and cultivators.
تThe landowners lived in a kinship headed by a DATU or a chief
within a community called BARANGAY.
تBARANGAY comes from the Malay word BALANGAY which
means “sail boat”.
تThere are three broad social classes: the datu and his family and
nobles, the freemen, and the dependents, which were considered
as slaves.

5. تEach barangay had its own economic activities.
تLand ownership was acquired through
occupation or inheritance.
تAgriculture was the main economic activity of
our forefathers.
تOur country is also rich in aquatic resources
and precious stones.

7. They brought Christian religion to colonize and rule
the country.
They also imposed their culture, customs and beliefs.
There were economic policies and reforms that the
Spaniards implemented in our country to attain
economic development.

8. THE
ECONOMY
UNDER
SPAIN
GALLEON
TRADE
AGRICULTURA
L PROGRESS
ENCOMIENDA
SYSTEM
ECONOMIC
SOCIETY OF
FRIENDS OF
ROYAL COMPANY
OF THE
PHILIPPINES
TOBACCO
MONOPOLY
THE
COUNTRY

10. Our country is an agricultural country and
farming is the main industry.
The Spanish government developed the
agriculture with the implementation of modern
agricultural methods.
The introduction of the first steam machine
for hulling rice by Eulogio de Otaduy and the
first steam machine fro hulling sugar by Nicholas
Loney had helped in the production of rice and
sugar.

11. First steam machine in hulling rice
by Eulogio de Otaduy

12. First steam machine in hulling
sugar Nicholas Loney

14. An ENCOMIENDA is a piece of land given to the loyal servants of
the King of Spain.
The person who received it was called the ENCOMIENDERO.
The King of Spain issued royal decree to stop all the abuses of the
encomienderos and required all landowners to register their lands in
the Philippines.
The decree led to the widespread anomaly in land registration.
Hectares of lands owned by the Filipinos were registered under the
names of the Spaniards, MESTIZOS and the elite Filipinos because
many Filipinos were ignorant and not aware of the provisions of the
decree and the real intentions of the Spaniards.
The encomienda system in the Philippines ended in the early years
if 19th century.

16. The Spanish government opened trade between
Manila and Acapulco Mexico.
In constructing the galleons, people were forced to
work in a shipyard.
The Spanish merchants took advantage of the trade.
Spanish officials used the BOLETA to earn income;
BOLETA is a ticket to have a space in the galleon.
The Philippine economy depended much on galleon
trade during that time.
When the galleon trade was abolished, the Philippine
economy suffered.

17. Boleta

19. ᴥThe administration of Governor Jose Basco y Vargas focused
on the economic development of our country.
ᴥGovernor General Jose Basco y Vargas established this with
the goal of developing the agricultural sector of the country
and helping the country to be free form Mexico’s help.
ᴥThe production of silk was introduced through the planting
of mulberry trees.
ᴥHe repaired the bridges and roads to speed up
transportation of goods to the different parts of the country.
ᴥHe made sure that the reforms and economic changes that he
established will benefit the Filipino people and the Spaniards
government.

22. ┼The Spanish government established the tobacco monopoly to
obtain big revenue.
┼MONOPOLY is a market structure where there is only one
individual or company, controlling the market.
┼Filipino tobacco farmers were obliged to sell their harvest to
the Spanish government who can buy tobacco.
┼There are selected provinces to plant tobacco like Nueva
Ecija, Marinduque, Cagayan Valley, and Ilocos provinces.
┼Even though it brings huge annual revenues to the
government and contributes to the production of said product,
the monopoly of tobacco did not last longer because of the
abuses committed by the officials, aside form the fact that it
encouraged smoking and smuggling.

24. In order to implement the economic plan of Governor
Basco, he founded the Economic Society of Friends of
the Country.
It has the responsibility to manage and supervise the
economy.
The Economic Society focused its activities on the
development of the different industries particularly the
agriculture.
It introduced the cultivation of mulberry trees, cotton
and tea.
It also emphasized the promotion of some
agricultural products like coffee, hemp and rice.

26. This royal company was established to boost the Philippines
economy through trade and development of agriculture and
industrial sectors.
The trading activities of the company competed with the Manila-
Acapulco trade.
It opened the trade between the Philippines and European
regions.
It was able to develop some industries of our country like wood
carving in Laguna, hemp in Bicol region, sugar in Negros as well as
in Pampanga and textile in Ilocos Region.
But that success was short-lived because of the abuses of
Spaniards.
It was finally abolished by the Spanish government in 1834.

28. After the Spanish rule of more than 300 years,
the Americans came.
Our economy was plagued with many
problems.
Our natural resources were destroyed during
the American and Spanish wars.
The American administration started to
rehabilitate our economy and improve our way of
living.

30. ☻The Americans had the intention of giving land to the
poor Filipinos especially the farmers.
☻Unfortunately, the small farmers didn’t get any land.
☻The land became the property of some rich landowners,
Filipino elite and Americans.
☻Most of the small farmers couldn’t pay the price to own a
piece of land and couldn’t prove that they were the former
owner of the land when the American government
implemented the Torrens System and the Homestead Act.
☻They failed to register their property and were ignorant
to avail of the provision of the Homestead Act which will
enable them to acquire 24 ha. of public land for their
family.

32. †One of the economic policies of the Americans was
the implementation of free trade between United
States and Philippines.
†FREE TRADE is concerned with the exchange of goods
and services without trade barriers like tariffs quotas.
†Trade barriers are those that prevent trade to happen.
†TARIFF us the tax levied on imported goods while
QUOTA is the limitation on the quantity of exported
and imported goods.
†To establish fully the free trade relations of two
countries, the following trade laws were enacted and
implemented by the Americans:

34. ■It was the first trade act which opened our ports to the
United States in 1909.
■All products from the United States were allowed to
enter the Philippines without tariffs and quotas while
Philippine products had quotas.
■Only 300,000 ton of sugar and 150,000 pieces of
tobacco can enter the American market.
■Americans limited their imports to protect their own
industries.

36. ◘In order to achieve the real the real essence of free trade
between the Philippines and the US, tariffs and quotas were
abolished but still, the law favored the Americans because
Philippine products with 20 percent foreign raw materials
were not allowed to enter American market.

38. ⌂This law established the Commonwealth
government in the Philippines to
prepare is for independence.
⌂It brought back our freedom.
⌂The law underscores free trade during
the Commonwealth Period form 1935 to
1946.

39. EFFECTS OF FREE TRADE
FREE TRADE
IMPROVEMENT OF TRANSPORTATION
DEVELOPMENT OF INDUSTRIES
INCREASE IN PRODUCTION

40. EXPANSION OF COMMERCE
TOO MUCH CONCENTRATION ON THE DEVELOPMENT
OF PRODUCTS THAT YIELD HIGHER INCOME
COLONIAL MENTALITY
WAS DEVELOPED
OTHER MARKETS
WERE NEGLECTED

41. AGRICULTURAL
DEVELOPMENT

42. ▓Model farms were established to teach the
farmers the modern methods of cultivation.
▓The Americans introduced six majors crops,
abaca, and sugar.
▓The Bureau of Agriculture was established in
1902.
▓Irrigation systems were constructed.
▓The use of pesticides and fertilizers, modern
techniques in farming and the use of modern
technology in farming were introduced to the
farmers to improve their production.

44. ¤The first step of the Americans was to introduce
the new machineries and technology in industries.
¤They established new industries and diversified
the old industries like mining, forestry and fishery
in order to increase the production of the said
industries.
¤Cottage industries to encouraged to produce
goods which were of export quality, cigar and
cigarette factories were established.
¤The economic development of the Philippines
during the American period was typically colonial.