Manila traces its origins to a small seaport established in the twelfth century at the mouth of the Pasig River. Captured by Spain in 1570, the wealthy Muslim kingdom of Maynila was proclaimed capital of the Philippines. Manila remained under Spanish rule for nearly four centuries, exporting agricultural products to the metropolis to be used for finished goods.
In the aftermath of the Spanish-American War the Philippines was ceded to the USA. From the outset, the goal of American policy was to integrate the new colony into the American market. Following independence in 1947, there was a major shift in the Philippine economic policy from export promotion to import substitution. The main beneficiary of the import substitution policies was the capital region.
The industrial base of this city of 8.6 million has broadened in recent decades to include textile production, publishing and printing, food processing, and the manufacture of tobacco, paints, drugs, oils, soap and lumber. Despite the seemingly stable city composition of Metro Manila, the Philippines has not been able to continue its growth patterns of the 1970's.
Metro Manila has serious infrastructure and environmental problems in the areas of land, water, air, sewerage, drainage, waste, and traffic. Land use in Metro Manila has been largely shaped by the activities of the private sector. Due to speculation, land prices have risen by 100-200%, thereby reducing access to affordable housing in the city. Metro Manila has a water supply system that is unsatisfactory, with a distribution system that is unable to reach much of the population on the periphery of the city. Water pumps are being used, which is increasing pollution in the water supply. This city has an extremely inadequate sewerage system. In total, about 11% of the population of Metro Manila are served by piped sewerage. The majority of sewage is conveyed through open ditches and canals untreated into Manila Bay. Air pollution is another major environmental problem, accounted for by motor vehicles and industry waste. The huge amounts of solid waste produced by the city each day often clogs the poor drainage pipeline and causes eventual flooding. As with most other metropolitan cities, Metro Manila suffers from serious traffic congestion.
What has evolved in Metro Manila is largely the result of market forces, as Metro Manila still lacks direct planning and development. One government attempt has focused on motivating leaders of the smallest political units, the barangay, to organize environmental improvement projects which encourages community self-reliance and active participation of citizens.