Upper-middle-income status and growing inequality
The reclassification of the Philippines after almost 40 years from a lower-middle-income economy to an upper-middle-income economy rank by the World Bank (WB) is a crowning moment for the Marcos administration.
The reality on the ground, however, tells a different story as the majority of Filipinos are poor and income inequality remains high. The question is, where did we go wrong when the benefits of a rising income level have been accompanied by growing inequality between the poor and the wealthy minority in our country.
As pointed out in the article “No instant prosperity” (Editorial, 7/8/26), “it is entirely possible that the increase in the average per capita income means that the rich have gotten even richer, while those at the bottom have actually gotten worse, and quoting the WB separate report showing that the top 1 percent of earners in the Philippines captured a hefty 17 percent of national income, while a smaller 14 percent is shared by the bottom 50 percent, evidence of one of the highest rates on income inequality in the region.”
Clearly, our economy has become a machine for the upward redistribution of wealth leading to the concentration of wealth and the rapid rise of the oligarchy in our country.
Even if we change our political system, such as abolishing political dynasties, unless we recognize the fundamental flaws in our economic system, the concentration of wealth in the oligarchy will continue to grow, which one economic pundit said perpetuates a vicious cycle of economic dominance that feeds political power to the minority rich and the political power then further enlarges economic dominance.
Without bold economic reform, the prosperity indicated by the rise to upper-middle-income status and succeeding increases in national income can never be felt or shared by the majority of Filipinos.
ANTONIO DE GUZMAN,
reform48@protonmail.com
