Influence of Spanish owned Businesses on the Philippines
Universidad Complutense de Madrid
On trying to know the reaction of the Spanish community to the end of their colonial dominance in the Philippines, we can have a better understanding if we look at what they did afterwards rather than if we read their contemporary writings which express their opinions more subjectively as these were written just after the defeat. Therefore, references made once time had passed can reveal more of their reaction once the first anger gave time to think about the future. An American report written during the Japanese Occupation pointed out with some kind of uneasiness: "Since the US acquisition of the Philippines, Spanish residents of the islands exerted economic influence disproportionate to their number (approx. 4000) through their extensive holdings on agricultural land operated with native tenants only slightly above the level of serfdom".
This report shows that the surviving capacity of these companies went far beyond that of the Spanish government authorities: born under special privileges, they became strong enough to survive a different regime. In this article I would like to analyze the reasons for this survival capacity as shown in half a century, and therefore I will try to analyze, first, the evolution and problems held by the Spanish citizens and companies as such since the end of the Spanish rule, in 1898, then give a brief account of those economic interests during the Pacific War, and will finish by trying to analyze the reasons of such an endurance along the American Regime, which were not only because of such feudal-type exploitation.
1) SPANISH ECONOMIC INTERESTS AFTER 1898 There were few Spanish economic interests when Spain's rule ended in the Philippines. Although metropolitan companies had enjoyed the obvious privileges given by the colonial government, the means to enjoy these benefits were scarce: Spanish capitalism was not much developed and the peninsula itself was economically dependent, mainly on French capital. Spain lacked the necessary resources to profit from colonization over the Philippines and its better example of a colonial company, the Compañía General de Tabacos de Filipinas or Tabacalera, had a good part of its assets from French extraction. Although the Spanish flag was raised in the islands, companies from other nations, Britain in particular, were the ones profiting from it.
The weakness of Spanish capitalism, however, explains only part of the scarcity of its companies in the Philippines, because the case of the other important colony lost in 1898, Cuba, was totally different. The so-called "Jewel of the Empire", Cuba was the place where Spanish capitalists obtained huge benefits that were later sent to Spain. Consequently, there was an imbalance inside that empire "where the sun never sets": while the Antilles (Cuba and Puerto Rico) gave big profits to Spanish companies and its feeling of closeness to Spain was very strong, in the Pacific colonies there were not such profitable activities and the identification with Spain and its culture was much more limited to aspects such as religion. Therefore, separation with Cuba was felt as a big loss and the quantity of capital sent to Spain was huge: some of the most important banks in present-day Spain were founded at the turn of the century with those funds sent from Cuba.
The loss of the Philippines was also very much regretted in Spain, but such a perception was somewhat different because the three centuries in which the two had linked had been lessened by the indirect character of the contacts (through Mexico), by the fact that such contact was not so frequent and thus the feeling of closeness, geographical as well as cultural, was not strong, and because of the scarceness of benefits. A proverb still used when someone losses something important says "Más se perdió en Cuba" -more was lost in Cuba, as a kind of inevitability of getting angry- has never applied to the Philippines. Even more, it can be said that after the first moments, there was even relief: "saving souls" and prestige had been the only reasons for maintaining territories so far away from Spain after 1605, when the idea of using the Philippines as a first step into mainland Asia had to be abandoned. Therefore, when it was known that the Americans wanted to buy the Philippines and Guam, the only concern in Madrid it was how to get rid of the rest of the islands in Micronesia. Germany wanted to buy only three islands (Phonpei, Kosrae and Chuuk) but Spain offered the whole Micronesia as a package and Berlin accepted soon: the agreement came so easily that had it to be maintained in secret until the Peace Treaty of Paris between Spain and the US was signed. The fact of selling territories with people like any other product was not an important concern in the Peninsula, since the much-needed money helped to forget possible feelings of misbehavior.
With the new American rule, Spanish interests obviously lost their former privileges, and three main reasons undermined the economic might of Spaniards: a) Physical attack. b) Loss of privileges. c) Relaxation of their citizens in its relation with Spain.
a) Attacks by Filipinos and Americans against Spanish economic interests came soon, which can be considered normal in such a revolutionary process as that in the Philippines and provoked the exit from the islands if a number of Spaniards, part of them because violence was actually directed against them and the others fleeing out of fear of becoming victims. The most important attacks to the economic power of the Spaniards came just after the end of the Philippine-American War when the new rulers settled in office, as one of the first measures was to end with the huge extensions of lands owned by friars. After difficult negotiations in which the Vatican took part, the religious orders had to sell most of their landed properties to the US government which later sold them to their tenants. Friar lands and holdings in the Philippines, therefore, were greatly reduced, although the religious orders got a financial situation to be envied due to the sale.
b) Loss of privileges to the Spanish companies was also felt, not only because of the loss itself but because power could also be used to root out those privileges gained through the centuries and to replace them with different people: privileges received formerly by law could be taken out in the same way. This process was slower, and the Spaniards tried to maintain them as long as possible and managed to establish a 10-year period by which they were given the same conditions as the Americans to have access to the Philippine market. This clause in the Paris Treaty, however, did not mean many privileges, as Washington avoided taking measures along this period that could also benefit Spaniards since during the first decade of the 20th Century the focus was to give a freer access of American products into the Philippine market. As a matter of fact, free access of Philippine products into America started only after 1909 through the Payne-Aldrich Law. Washington, avoiding measures that could give some preferential treatment to Spaniards, limited also the access to other foreigners that could have applied for it due to the most-favored nation clause. Washington was not ready to accept it because the Philippine market should be restricted for the American companies; his practice in this country, however, was contrary to the "Open Door" policy championed in China.
In many occasions, privileges held formerly by Spanish companies were lost simply because of Spaniard's new condition as foreigners. Legislation of shipping can be a good example of this as it became compulsory to utilize US ships to export products out of the Philippines, while the decision to forbid the purchase or to substitute ships for foreign companies affected mainly the Spaniards and particularly Tabacalera, the most important company dedicated to coastal traffic at the turn of the century. Tabacalera was very much affected and lost its leading position in this field; when it applied for the 21 routes offered on competitive examination by the American government, its bid was rejected, apparently because of being very expensive. With all these problems, Tabacalera's fleet was reduced progressively: with a fleet of 5.811 tons in 1926, it was reduced to 1.186 in 1940. The disappearance of its importance can be seen if we compare this quantity with the total weight of fleets: from a total of 43.000 tons, the weight of the 35 ships owned by Tabacalera was no more than one thousand tons. Although Tabacalera created its Tabacalera Steamship Co. as a subsidiary company, this solution was only partial. Damage to the company was big because this company needed to have its own transportation capabilities. Damage to Tabacalera's economic might was also reduced because of the forced selling of some ot its Haciendas, such as San Luis and Apolonia, in Negros, done in 1935 and 1936. Because of the different measures taken "to protect its planters and tenants, [because of that] an uneasy situation was created in the Tabacalera, reflected clearly on its internal documentation".
The desire to diminish the fortunes of Spanish companies was not exclusive of the Americans. The Filipino elite also looked to enhancing their wealth through regulations aimed at obstructing competition from other nationalities or directly forbid their participation in some areas. Quezón, for instance, proposed an article in the Commonwealth Constitution prohibiting other nationalities besides the American and Filipino from participating in the retail and wholesale trade.
C) The relaxation of ties with the peninsula and among the Spanish community itself was also another natural consequence of the disappearance of Spanish political dominance. The number of its citizens decreased, not only because of increasing difficulties to emigrate into the islands but also because of the lack of bureaucrats or soldiers, whose presence was more on a temporary basis and therefore less drawn to the Philippines. Furthermore, many sons of Spaniards got Filipino nationality and it became normal to have members of different citizenship inside a family, regardless of their place of birth. Besides that, there were conflicts inside the Spanish community due to the Spanish War: the colony became deeply divided among three different groups bitterly confronting each other, leftist republicans and Basque hacenderos; Falangistas backing blindly for the Franco Government; and the wealthy families, whose ideology was strongly conservative (therefore clearly being in Franco's side), but whose allegiance was torn after World War II started: its money was more attached to the United States, opposite that of Franco and Falangistas.
These conflicts among the Spanish community did not result in violence, but the atmosphere created prevented the community from acting as one. Although most of the economic power remained under the group of wealthy families and therefore continued united, they decided progressively to accelerate the process of getting Filipino citizenship as a way of protecting its properties, partly because they were trying to protect their properties in case Spain joined the Axis and partly following Quezón's attempts to promote a Filipino upper class.
II. The Spanish Companies
Directly or indirectly, the economic situation of most of the Spanish citizens, besides the missionaries, rotated around three companies: Tabacalera, Andrés Soriano & Cia. and Elizalde & Cia.
Founded in 1881 after the end of tobacco monopoly, Tabacalera soon after started handling abacca, copra and sugar milling, as well as other businesses such as alcohol distillery and coastal traffic. The Philippine Revolution started when the fruits of the investment were rendering its first profits, such as in the hacienda La Luisita, Tarlac or with the creation of one of the biggest cigar factories in the world, La Flor de la Isabela. Its tobacco storehouses spread all around the archipelago and were used also to collect copra and other products. Up to World War I, its main profits came, in decreasing importance, from gathering leaf tobacco, its processing, gathering of sugar and exploitation of haciendas. After this conflict, Tabacalera started to profit from the sugar mills business, the temporarily rice, to try the insurance sector and even installed a paper mill in 1941 destined to use the husks of sugar cane. Its golden years were in the interwar period, when sugar had a predominant role in the company profits and there was not much problem in assuming losses from tobacco and from the decreasing share in the cigar exports to the United States, which went from 39% in 1933 to 12% in 1939. In spite of this, Tabacalera gave yearly profits to the shares along this period with only two exceptions: 1933 (33%) and 1937 (14%). It was the private company with the biggest number of employees in the Philippines, and in its Hacienda La Luisita, up to 6.000 people worked. 200 Spanish citizens were in its payroll at its best moments. Tabacalera was also the main copra exporter up to World War I and, in relation to sugar, it became the main exporter -although not the main producer- with its peak year in 1934, selling 278.000 Tons.
II.B. ANDRES SORIANO y Cia.
Andrés Soriano possessed an Empire extended from its San Miguel Brewery, later San Miguel Corp. It had been under his management after 1910 and since then had gained up to a 90% share in the beer market in 1928. Soriano diversified its businesses with yeast, dairy products, ice and soft-drinks, among them Coca-Cola. Its connections with American Companies were much extended and he represented a good share of its investments in the Philippines. In the 1930's he became more interested in gold mines as the prices of the ounce increased from US$ 30 to 45 and, seemingly because of his leading capacities, dragged along with him a good part of the fortunes of the Spanish community. He was associated with the Roxas family in companies like Sorox and Co. and its companies were located also in the United States, France (Ansor) and Spain, a country which frequently visited.
1.C. ELIZALDE & Co.
The vast interests of the Elizalde family were structured around Ynchausti and Co., Inc., later changed to Elizalde & Co. when the descendants of the founder, less involved in management, sold its shares. Its main companies were: Elizalde Rope Factory, Inc., Elizalde Paint and Oil factory, Inc., Manila Steamship Co., La Carlota Sugar Central, Tanduay Distillery and Pilar Sugar Central. They were involved, therefore, in the processing of ropes (they exported two thirds of those made in the Philippines) and its provision to ships, on paint making after the extraction of oil from lumbang tree, on processing of alcohol's and on centrifugation of sugar through their two sugar mills, the most important of which (and one of the biggest in the Philippines) was La Carlota, in Negros Island. Being four brothers, they had distributed among themselves management of business and political connections: Manuel was prominent in business and Joaquin Miguel (Mike for Americans) in political activity. He become director of the public company in charge of promoting industrialization, the National Development Company and, after 1938, was appointed to Washington as Resident Commissioner.
Other businesses affiliated with the Spanish Chamber of Commerce were very much interrelated with the former ones, like those of Roxas (with Soriano) or else their importance was not comparable to the former ones. The rest of the important companies affiliated with the Spanish Chamber of Commerce were: Banco de las Islas Filipinas; Banco Hipotecario de Filipinas; Philippine Sugar States Inc.; La Insular, Fábrica de Tabacos y Cigarrillos; La Yebana, Fábrica de Tabacos y Cigarrillos; Commonwealth Insurance Co. & Tuason y Sampedro.
It is rather difficult to obtain more accurate data on the proportion of Spanish business in the Philippine economy. I am presently working on it. As a matter of fact, Spanish companies had a very important share in every export from the Philippines, probably with the exception of lumber. Up to the First World War, Tabacalera was the leading exporter of copra and in relation to sugar passed from the eight to the third position. After that, Tabacalera became the main exporter (although was not the main producer), being its peak in 1934 with 278.000 tons.
3. THE REASONS FOR THE ENDURANCE OF SPANISH COMPANIES.
I consider there are four main reasons for the comparative strength of the Spanish companies when the Philippine islands were about to be entered in the Pacific War: the tight ties with Filipino society, the quick adaptation to new American colonials, their relative good performance as such companies and a seemingly clever defense of former privileges.
3.1. INTERCONNECTION WITH FILIPINO INTERESTS
There was a hispanicized group in the Filipino society that was much more extensive than the 4000-odd citizens with Spanish passport. They were most of them Spanish mestizos, they spoke Castillian and felt themselves identified with the problems that affected Spain probably in the same way that other holders of Spanish nationality could be affected by developments in the Philippines, for most of them it was the land where the were born and where they surely would die. They have been referred as "Hispanic Cosmopolites" or as "near-Spanish" who are technically Philippine citizens and is difficult to identify the different groups that incorporated as it was a feeling which depended on each person, more problematic to figure out if we descend into the lower or middle classes of society.
This problem deserves a research by its own, but to quantify its economic importance it could be very useful the analysis made by Theodore Friend using data submitted to the United Stated Senate Committee on Territories in relation to investment on sugar mills. It shows that 49% of that investment was Filipino, 26% American, 24 % Spanish and 1% Cosmopolitan. Friend analyses this data and guesses as incorrect to ascribe the capital from the Ossorios, a creole family, as Filipino while that of the Elizaldes was considered as Spanish. Therefore, he restructures the figures and allocates the investments made by this families into the Cosmopolitans, which raises up to the 25%. Filipino capital, goes down to 39%, American goes up two points up to 28% and Spanish one is the one that goes down in a bigger proportion, being merely an 8%, which should be that one from Tabacalera.
3.2. ADAPTATION THE AMERICAN MIGHT
Lay Spaniards that remained in the Philippines after 1899adapted relatively well to the new colonialists, not only accepting it politically but also in its economic ideas. Once it proved impossible the comeback of the Spanish domination, the American rule could be seen as one of the best options they could have calculated in advance: the colonial situation was maintained with another western power and, furthermore, a bigger and more prosperous market was opened. Probably the best example of this adaptation is that the Spanish Chamber of Commerce in Manila was the first advocator of free commerce with the United States, from mid-1905 until 1908. The possibility to export to the U.S. through the Philippines as a back-door, trying to use the formerly referred article in the Treaty of Paris, was clearly in the mind of those Spaniards when they claimed a kind of relationship with the U.S. By this time at the beginning of the century, their position was refused by the Filipino society (but for those in the Partido Federal more pro-Americans), and the possibility to benefit from the 10-year period sanctioned in the Treaty of Paris should be the reason for such a defense.
One of the reasons for this adaptation had to be the economic needs after violent times, but other one had to be also the benefits that the Spanish business community perceived when new masters arrived and settled. Contrary to Spanish bureaucrats, the American government was a reliable one with officials fulfilling better their promises and doing a less arbitrary task; the main problem with taxes, for instance, was not the amount but the employees that spent the money after it was received. We can find a very early optimism in Tabacalera, when its 1901 Official Memory declares: "Although the peace seems to be reestablishing in the Archipelago, it is not yet clearly perceived what awaits us and it is not good yet to be too optimistic".
The power decline of the catholic church in the Philippines does not necessary mean that of every Spaniard. Even more, the lay Spanish citizens and their business had suffered the same as the rest of the society from the consequences of irresponsibility and rest of the Filipino society during the Spanish regime due partly to the disproportionate rule of the church in the islands. And same as the American government satisfied the needs of ilustrados Filipinos, also it could have done the same with the Spanish community. Jaime Gil de Biedma, a poet and writer touring around the Philippines for Tabacalera in 1954, writes that every Tabacalera worker is anticlerical. This fact is more important if we notice than Tabacalera was founded by the Marquis de Comillas, a family name very closely associated with Jesuits.
Spaniards adapted well to new ideas of free enterprise brought in by Americans because, same as in the rest of communities in Latin America, those who had departed from Spain were the more entrepreneurial themselves. Contrary to the peninsula, Spaniards in the Philippines used to work in business as professionals and preferred these occupations to bureaucratic jobs. One of the continuous problems of the schools in Spanish, for instance, was that they lacked Spanish professors; surely they could earn more money in business. The Spanish Community in the Philippines was a very wealthy one and the schemes to help poor Spanish (Hospital de Santiago, Auxilio Social and others) usually had the problem they had to help to Filipinos: there were not enough Spaniards in state of need.
Even religious orders seem to have adapted well to their losses in real estate after the demise of Spanish power. With the money received, they established the Philippines as their center for the Far East and expanded their business in the rest of Asia, particularly China. When new missionaries were sent to Far East, some of them even were sent through the United States to the Philippines, and from there it was decided their final destination: China, Japan, Philippines and so on. An account by the same Gil de Biedma affirms that:" The Jesuits have a pawnshop in Manila and control a good deal of the exchange business in Hong Kong, the Dominicans monopolized the renting of rickshaws in Shanghai, the Recollects are the most important share holders in San Miguel Beer, more important than the Sorianos and the Roxas, etc."
By its side, Washington should not be interested specially in suppressing totally other nationalities capacity of pressure among the Philippine society as, Giesecke points out, "foreign capitalists might someday provide a lobby opposed to the independence of the Philippines". Spanish and Americans shared the interest on maintaining the colonial status-quo and make them dependent from the U.S., the firsts to maintain exports and the profits generated, and theAmericans focusing more on political dominance and its role in Asia in general.
3.3. MODERN SPANISH BUSINESS
The forty years under American rule and the exports to a restricted market generated a bonanza for the economy in the Philippines. Spanish companies not only benefited from that, same as the rest of business in the archipelago, but their performance was relatively good under the new circumstances.
Among the reasons for that is the change into the demographic balance of the community. New immigration from Spain came to give a boost to business in general with young people arriving into the Philippines after having escaped from military conscription for the Colonial war in Morocco. Also important is the bigger proportion of those coming from the two most industrious regions, Basques and Catalans. The Elizalde companies usually had only Basque employees among Spaniards and Basques were also most of the sugar planters in Negros. Tabacalera was set up in Barcelona, although there is not a clear pattern of contracting mostly people from Catalonian. On the opposite side, the lessening of administrative presence and diminution of friars power means a minor presence of Castillians (where most of Dominicans came from) or Andalusians.
The community, furthermore, could count on dynamic leaders such as Andres Soriano, the Elizaldes or Antonio Melián, which could exert a positive influence toward commercial activities, something that had not been possible in the former century, when government was under the dominion or religious fathers that could assimilate trade with the enemies of Catholic Spain and with entrance of new subversive ideologies.
Furthermore, Spanish companies had an important role in the modernization of the production improvements of the Philippines. Investments like that of Tabacalera with the aim of exploiting hacienda La Luisita, helping the government into the financing of irrigation channels that could facilitate cultivation of rice, which apparently were the main hydraulic work in the decade of 1910, show an example of the attempts to get a bigger profit from land, obviously thinking in the benefits for the company but also planning on a medium-long term. Tabacalera claims also a key role in promoting the change of sugar production from the XIX Century artesian ways to the central mills making the sugar solicited in the American market. Tabacalera's 'Central Azucarera de Bais,' also, and Elizalde's 'La Carlota' lead the race to increase production in order to gain a larger share of the total trade in anticipation of the Quota System for duty-free access of sugar in the United States.
Continuing with Agriculture, where the Banco Hispano-Filipino had a big role at the beginning of the century, the census of the Philippine islands shows a bigger equipment pertaining to lands owned by Spaniards than on those owned by other nationals. The 1948 Census of the Philippines shows that the relation between value of the land (buildings included) and value of farm equipment has a bigger importance of machinery in the lands owned by Spaniards that by those owned by Americans. American citizens total value of owned land was 3.889.416 P (its value approximately half a dollar) and 90.5% was the value of land itself with a 1% being the value of machinery. Spaniards owned a little more, 4.497.860P, but the value of land itself was only 85.2%, being the value of machinery 3.3%. Relation of value of Farm Equipment and total was 1.8% in the case of Chinese.
Spanish Companies invested also in new sectors of the economy. Although they did not get access to the technologies that allowed an easy entrance to American companies such as pharmaceutical, photography or car industry, they used european patents. The first factory of cement was started by Recollects in Binangonan with a group of Manila businessmen, importing machinery of Krupps and bringing German technicians, and the first factory of cellulose was set up by Tabacalera in Bais, in 1941, using an Italian patent.
3.4. DEFENSE OF PRIVILEGES
Almost guaranteed export to the U.S. made to many companies in the Philippines to be little competitive, and many of them probably could not have survived in a different environment: sugar was produced at a price half of that in the Philippines in islands like Cuba or Java. After all, this was an overall problem of Philippine economy under American tutelage and that allowed to survive a company with such high fixed expenses as Tabacalera; its oversize, as well as keeping in use traditional methods of working, deter it from getting benefits in sectors like copra, where decision on prices and markets needed to be rapid. Tabacalera's adaptation to the needs of the market was slow and, in the case of tobacco, could not adapt on time to new tendencies favoring cigars with less nicotine or cigarettes, therefore, when its quota of cigars to export to the U.S. could not be filled, brands from other companies filled the gap. In the Philippines, cigar brands like "El Chorrito" gradually lost market share to foreign ones as "Blue Seal", more aromatized and better announced, and from 1938 foreign sales overpassed that of nationals. Tabacalera's structure made it to be a conservative character, but partly reason for this is that with such high profits from sugar there was not an imperative necessity to restructure tobacco handling. Generally speaking, lack of competitiveness was a problem affecting every sector of the Philippine economy and had more relation with the artificial conditions in which it was regulated due to such a free access to the United States.
If there was an strategy of defense of its own privileges, that should have been its entrenchment with the Filipino society, precisely because of their being an integral part of it. If, along nineteenth century, the Philippines was an Anglo-Chinese colony or, afterwards, there was an increasing American power, Spanish economic interests were benefited by the increasing privileges that received the Philippine companies: politicians obligatory reliance on their funds. It is difficult to mention nationality when referring to funds allocated to politicians during campaigns, but Spaniards seem to have played well and been in many winning positions. European groups, even British, seem to have allied very well with Spanish companies, which seem to have leaded contest against Asians, as can be seen in the Roxas campaign in 1946 when the winner (backed by a group of hispanicized, although he himself without relation to Spanish Roxas already mentioned) fought against Chinese-mestizo Osmeña, or during the reaction against Japanese immigration.
Defending their privileges, Spanish companies should have been good also at adapting with the system of favours, prebends, compadrazgo and the like. In the case of Tabacalera again, overall limitation of latifundiums to 1.1024 hectares was solved giving parcels on lease through the payment of a rent calculated to be the 15% of production, with the company having the recognition to buy the complete or just a part of the harvest of cane.
The political and economic system, in essence, differed little from the Spanish one and this was a main reason why Spaniards took little time to adapt to the new situation. Vote-buying was made also in the Spanish countryside by the same time, caciquism still was in force and political contacts were as necessary in Spain as in the Philippines to achieve a prosperous business. The construction of the canal to irrigate La Luisita obviously was a favor against other lands that also needed irrigation, and the favor should have been paid in another way. Probably this payment has relation with the setting up of one of the Tabacalera subsidiaries to produce coconut oil, Hispano-Philippine Oil Co. Although it never gave profits, the reason of its foundation, following the Acts of the governing body, was "political reasons totally justified after having received a continuous pressure from our Filipino friends". On the other side, Tabacalera had since 1923 a reservation fund stored amounting to three million pesetas in order to renovate the fleet; surely they expected the legislation could be modified and attempted to achieve it through these "Filipino friends". We don't know which strings were pulled and what kind of favors did not give enough results, but surely Adrián Got, president of Tabacalera and close friend of President Quezón, was related.
4. A NEW PATH FOR THE RELATIONS
The pillars that supported the relation between Spain and the Philippines were modified after 1898, there was no more a relation dominator/dominated and catholic religion stopped distorting the mutual relation so strongly. Since the turn of the century, the Filipino Spanish intercourse was based on two pillars: economic interests and religious, both strongly tied by the cultural identity between the two countries. The importance of the religion and the economy was not new, but the main change was the different balance of the relation, because from then on private interests dominated over the interests of the state as such.
Therefore, relations in the first half of the XX Century should not be said between Spain and the Philippines, but Spaniards and with Filipinos, or by Spaniards in the Philippines. From 1898 until the Pacific War, State as such abandoned its role in the contacts and they became pushed from private corporations, religious as well as with an economic character. Main Fil-Hispanic institutions have been, precisely, those created those years when private entrepreneurship was dominant, such as the three Spanish Casinos at Manila, Cebu and Iloilo, the Hospital de Santiago, the Hogar San Joaquín, the Jai-alai, and even the Falange and its Auxilio Social. Role of State was relegated in such way that trips by academicians, litterateurs or others conferenciants such as Vicente Blasco Ibánñez or Federico García Sanchíz were financed from the Philippines. Even the Spanish Consulate was allocated in the Casino at Manila and its Fiestas and other celebrations were paid by the community. The secondary role played by officials can be seen in the Consul's lack of right to vote in the discussions at the Spanish Chamber of Commerce. The Community, or more appropriately said, the wealthy families, assumed the role that corresponded to an Spanish State that was overwhelmed with domestic problems: sense of relief from the Philippines previously mentioned matched with increasing problems in never-ending adventures in Morocco. There was no calm to think neither money left to spend.
Dominance of private ties, however, proved much more strong than official ones. Above mentioned institutions have helped much more to increasing contacts between the two countries than other initiatives. On the other side, trade has shown that 1898 was a date that marked the dramatically increasing mutual trade. With a total exchange of 4 million pesos in 1898 and 7 in 1900, at the end of the decade of 1920 was around 13-14 millions, a considerable quantity if we notice if we notice how the American market distorted exports from the Philippines: it imported up to 99% of exports of sugar, for instance. Trade between Spain and the Philippines lowered somewhat during the 1930's and the year before the outbreak of the Spanish civil war amounted only to six millions, reasons for that were the problems derived from the Crisis of 1929 and the disproportionate rate between exports and imports in favor of the Philippines. Spanish authorities tried to mitigate it, but Spanish companies as Tabacalera always reminded the money sent from the islands to Spain, that apparently compensated the deficit. Spain, finally, profited from the Philippines.
The Cuban and Filipino processes of separation from its former Metropolis after 1898 had some resemblance's: the end of colonial rule became more a boost than a restrains in mutual relations. More than that, a relation that resembled more that on equal status basis, freed both of them from distrust and suspicion. Such a resemblance finally disappeared with the Pacific War, however, and while the relations with Cuba have continued steady and going on trough independence and even while the communist regime of Fidel Castro was contemporaneous of that of General Francisco Franco, that of Spain and Philippines collapsed.
 This research has been made thanks to a grant received by Toyota Foundation, and is a part of Ph.D. research for the University of Tokyo. The author thanks the help received from Rico T. Jose in correcting the English version. Abbreviations: AMAE-R: Archivo del Ministerio de Asuntos Exteriores. Sección Renovada. BIA: Bureau of Insular Affairs. NARA: National Archives and Records Administration, Washington. RG: Record Group (NARA)  NARA. BIA. RG 350. Box 1318. Secret Report, July 28, 1943.  Probably the most interesting case was that of Micronesia, an archipelago that provoked massive demonstrations in the mid 1880's against the German attempts to seize it. After a mediation by the Pope, Leon XIII, they stayed under Spanish sovereignty, but there was never a company that could profit from the copra produced in the islands, and the profits were for a German company established there, Jaluit Gesellshaft.  Rodao, Florentino. Españoles en Siam, 1540-1939. Una Aportación al Estudio de la Presencia Hispana en Asia. Madrid, CSIC, 1997, p. 36.  For examples of such a violence, Aguilar, Filomeno V. "Masonic Capitalism and Revolution in Negros", in this same volume, and McLennan, Marshall S. "Changing Human Ecology on the Central Luzon Plain: Nueva Ecija, 1705-1939", in Alfred McCoy & C. De Jesus (de.) Philippine Social History. Global Trade and Local Transformations. Ateneo de Manila University Press, Manila 1982, pp. 69-70.  Salamanca, Bonifacio S. The Filipino Reaction to American Rule, 1901-1913. New Day, Quezon City 1984, pp. 106-109. See also Giesecke, Leonard F. History of American Economic Policy in the Philippines during the American Colonial Period, 1900-1935. Garland Pub., New York 1987, pp. 60-61.  Spanish legislation was limited in its time to establish temporary preferential rights.  Giesecke, op. cit., 156.  Giralt Raventos, Emili. La Compañía General de Tabacos de Filipinas, 1881-1991. Compañía General de tabacos de Filipinas, Barcelona 1981, p. 163.  Ibíd, p. 149.  RODAO, Florentino. "Spanish Falange in the Philippines, 1936-1945", in Philippine Studies Vol. 43(1):3-26. In Tagalog, "Ang Falange sa Filipinas, 1936-1945" (trasl. by Diosdado R. Asuncion), in Ferdinand C. Llanes (ed.) Pagbabalik Sa Bayan. Mga Lektura sa Kasaysayan ng Historiyographiya at Pagkabansang Pilipino. Manila, Rex, 1993, pp. 126-154. Also see my "Ending the Priority of Private Links. Spanish Interests in the Far East around 1945". To be published, Instituto Cervantes, Manila, 1997.  For the history of the Company, it is very convenient to read the book edited on behalf of its centenary. Giralt, op. cit., p. 318. Also, AMAE-R. Bundle 2910, exp. 20. Report by Francisco Ferrer, Madrid, November 20, 1945.  Giralt, op. cit, p. 129.  There are many bibliographic references on Andres Soriano, see among them the Memorial Issue of SMCEU Bulletin edited after his death, Manila, 1965. See also Yoshihara, op. cit., pp. 52-53, passim. To see documentation about him, although mainly of political character, NARA, RG 126: Office of the High Commissioner of the Philippine Islands. Entry 2, book 52, with a folder titled: Soriano. Commonwealth, 1942-1945". and RG 350, BIA, Box. 1318. In AMAE-R, Bundle 1733, exp. 26, a telegram by Consul José del Castaño, Manila, December 13, 1943.  Giralt, op. cit., p. 129.  FRIEND, Theodore, Between two Empires: The Ordeal of the Philippines, 1929-1946. New Haven, Yale University Press, 1965, p. 118.  NARA. BIA. Rg 350. Box. 1318, exp. 28712-9. Entry. 5. Secret Report July 28, 1943.  This data can be read in the American Chamber of Commerce Journal, Sept. 1928, p. 20; in Friend, op. cit., p. 182. Doeppers mentions that Spaniards possessed a 32% of the total milling capacity, in Manila, 1900-1941. Social Change in a Late Colonial Metropolis. Ateneo de Manila University Press, Manila, 1984, p.9.  Salamanca, op. cit., p. 212.  Giralt., op. cit, p. 104.  Gil de Viedma, Jaime, Retrato del Artista en 1956, Barcelona, Lumen, 1991, p. 79.  El País, p. 22, 3-1-1991)  Op. cit., p. 45.  Aguilar, art. cit., pp. 4-6.  On the problems of the project, see Giralt, op. cit., pp. 126, 146-148. See also Stanley, op. cit., p. 193.  Giralt, op. cit., p. 158.  See Friend, T., "The Philippine Sugar industry and the politics of independence, 1929-1935", in Journal of Asian Studies, 22 (1963), p. 184-185 and Doeppers, D. "Metropolitan Manila in Great Depression. Crisis for Whom?" in Journal of Asian Studies, 50, 3 (1991), p. 516.  Giesecke, op. cit., p. 113.  Summary and General Report on the 1948 Census of Population and Agriculture. Bureau of the Census and Statistics. Bureau of Printing, Manila, 1956, p.2239.  Quirino, Carlos, Philippine Tycoon: The Life and Times of Vicente Madrigal, 1880-1972, unpublished, p. 93; Giralt, op. cit., p. 219 passim.  Doeppers, 1991, p. 524 and 1984, pp. 21-22. Menciones en Giralt, op. cit., 155-156.  See, for instance, La Vanguardia, 23/May/1931, on the critics to the bringing of brides for Japanese agriculture workers. Between Spaniards and Chinese, however, there can be mentioned also a sense of complementariety, as the main occupation for Chinese inmigrants were little business, something very few Spaniards did. In Cuba, on the opposite, those jobs in pawnshops and the like were made by Spaniards.  Giralt, op. cit., pp. 127-128.  Ibíd, pp. 165-66; 132.  Giralt's work itself mentions even about pressures near political power to bet the law to be modified. SOURCE: www.aeep.es/socios/rodao/99a1eng.htm