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Technological dependence: nature and consequences

Technological development is essentially a historical process that depends on a society's initial state of S&T knowledge and the significant influences that modify, enlarge, and stimulate that existing base. When the Philippines first made contact with the more technologically developed Western cultures, its technological capabilities and capacity were primitive. Because of the very unequal development of the two cultures, Western domination was the inevitable result. The contact did not result in any significant technological learning for the Philippines over the centuries of Spanish and American rule. After more than 400 years of colonization, the Philippines still relies on other countries, principally the US and Japan, for most of its technology. This situation is a sure symptom of technological dependence.

Like most multidimensional concepts, technological dependence is difficult to define rigorously. A clarification is attempted here.

Technological dependence could be considered the opposite of self-reliance. One transparent indicator of its existence is a situation in which the major source of a country's technology is abroad.¹⁴ When a country imports from a single country, it has a very high degree of technological dependence. From these considerations alone, one is easily convinced of the state of technological dependence of the Philippines.

There are other useful macro-indicators of technological dependence, which are shown in table 14. The consistently low figures for the number of scientists and engineers, R&D expenditures and patent grants for the Philippines, compared to the Republic of Korea and Japan, reflect its undeniable state of underdevelopment and technological dependence. There is no desire to be labor this point. However, the various indicators show the particular areas of relative weakness. These could be useful in the formulation of policies and strategies.

Table 14. Technological capacity: selected indicators, 1982

Sources: UNESCO Annual Statistical Yearbook, 1984; Techno-economic Evaluation Division, Planning Service, NSTA; ADB, Key Indicators of Developing Member Countries of ADB, 1985: Bank of Japan, Economic Statistics Manual, 1984; Philippine Yearbook, 1983.

a. 1983.

The case-studies provided a very detailed picture of the gross features and nuances of self-reliance in particular industries. Table 14 summarizes the strong and weak points with respect to the self-reliance. micro-indicators arising from the results of the case-studies.

It is interesting to observe that in the older industries like copper and coconut, the weak points in self-reliance are those relating to inadequate and low quality of R&D. The prognosis here is that there is very little desire and ability to improve the industries technologically. In spite of their long histories, technological capability has remained low. In general, the capabilities are still in the operative stage. These observations are consistent with the very low values of macro-indicators for the Philippines in table 14, which show relatively very little expenditure for R&D. In the case of copper wire manufacture, the industry is still dependent on the mother companies abroad for R&D. The same is true for coco chemicals. In these two cases the original licensing agreements required the local entrepreneur to fill his R&D needs through the mother companies. Government research agencies have been engaged in coconut research for a long time, but they have concentrated on the agricultural side of the industry. The research that has been done on the processing aspects is not relevant to the needs of industry, or, if it is, it has simply been ignored. One can say that, in the older industries, persistent colonial attitudes seem to hinder the growth of S&T self-reliance.

In the case of the newer industries (geothermal energy and semiconductors), technological dependence is starkly apparent. The micro-indicators of interest in table 15 are the nationality of management, dependence on inputs and financing, and the importation of the hardware of production. It is interesting to note that geothermal energy is the pride of the government science establishment. Its rapid development made an impact on the local energy scene.

However, the role of Philippine science has been limited to the exploration aspects. In fact, the local expertise that has been developed in this area is of world-class quality. Sadly, however, the actual installation of machinery and pipelines was carried out by foreign multinational companies. Indeed, the Philippines is totally dependent on imported capital equipment for most of its industries.

In all the case-studies, there is evidence of heavy technology imports. Even in an old industry like mining, the biggest mine in the Philippines relies on foreign managers for the supervision of the underground operations and the maintenance of the heavy equipment. Most of the machinery is imported. In the entire copper techno-system, only the furniture is of purely local origin.¹⁵ In the assembly and packaging of semiconductors, practically all equipment and material inputs come from abroad. Similarly, all processes and technologies are licensed by foreign firms.

As Stewart points out,¹⁶ technology imports are addictive. In the Philippines, technology transfer is the standard way of initiating new enterprises because it appears to be the quickest and most convenient way of doing things. Once established, technology imports tend to inhibit the growth of local initiatives in the same industry because of the latter's inability to compete in terms of quality and cost. Given the lack of technological capability to develop substitutes, a local vested interest grows up around such enterprises, which end up dominating the market and assuming a prominent role in the national economy. At this stage, the continuous importation of technology becomes difficult to manage and control.

Technological dependence in the Philippines comes in many forms. In the older industries, the importation of critical inputs and capital equipment is the most common. This is followed by the actual management of enterprises by aliens, as in the case of coco chemicals and copper wire manufacture. The lack of R&D isolates these companies from the mainstream of technological innovation. Ultimately, they lose their competitive edge in the world markets. In the newer industries, foreign investments and financial control are the mainsprings of technological dependence; the case of the semiconductor industry is typical. Most Philippine operations are only the dispensable components of a long chain of operations leading to the marketable product. In other words, only certain portions of the techno-system are under some kind of control by Filipino nationals. In almost all cases, the learning process for Filipino technicians and engineers is of little value in the national context.

Table 15. Indicators of self-reliance in science and technology: case-studies

In the dependency theory of underdevelopment, it is postulated that the third world is immersed in a complex but painful array of dependent relationships with the industrialized countries. This dependent relationship spans the economic and cultural spheres. This is especially true in former colonies like the Philippines, where the values of the colonizers have been internalized and have grown deep roots. Industrialized countries' interests have developed powerful local constituencies. The most critical aspect of this entire dependent relationship could well be technological dependence. Because of the vital role of technology in the life of any nation, its control, whether direct or indirect, implies effective dominance of all the other aspects of national life. The freedom to explore alternative paths to development has been confined to very narrow limits for most third-world countries. Whether universally valid or not, the dependency theory provides a convenient conceptual frame for the understanding of the nature of technological dependence.

Since technological dependence is a multilateral relationship between a user and various suppliers of technology, governments, and international organizations, the quest for S&T self-reliance in the Philippines cannot be separated from the geopolitical context. Measures directed at S&T alone cannot succeed unless they are complemented by the influence of the technologically advanced countries. The TNCs are more affluent and powerful than many third-world countries. The economics of technology is characterized by imperfect markets in the perpetuation of technological dependence. Their awesome resources and corresponding power must be confronted with all the cunning and caution that third-world countries can muster.

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