28 The Maritime Industry and the Navy

The Philippines is one of the few nations that recovered early from the Great Depression due to its economy being temporarily restricted from international trade while the government kickstarted its development program.

The various debt-driven programs allowed for sustained economic activity during the economic downturn allowing many industries to expand and cement their presence as the economy recovered.

Industries that benefitted the most included the shipbuilding industry, and the shipping industry.

The government introduced subsidies and performance-based tax cuts to help many industries flourish and at the same time provide higher quality products for the benefit of the Filipino people.

These perks allowed for the expansion of multiple local industries ensuring the need for additional merchant ships of various sizes to cater to growing demand for the transport of goods locally, and internationally.

The successes of the commercial maritime industry led to a further upgrade and expansion of the country's maritime trade network, with the help of the ports upgraded by the Americans years ago, allowing the Philippines to once again strengthen its position as a major link between Asia and the Americas.

Included in these upgrades are for the ports of Manila, Iloilo, Cebu, Davao, and the recently opened commercial port of Subic allowing these international hubs to be connected to major ports outside of the Asia-Pacific like New York and London.

The economic growth of that started in the mid 1920s also saw an increase in the number of Filipinos able to travel outside of the country which greatly helped with the growth of the few local steamship companies who already served routes to Guam, Tokyo, Nanjing, Hong Kong, Singapore, Batavia, and Sydney.

Steady demand also allowed these companies to eventually purchase ocean liners able to cross huge distances enabling them to serve passenger routes as far as San Francisco having stops in the U.S territories of Guam and Hawaii.

The first and most well-known ocean liner in the country the Mayon, owned by La Estrella de la Republica, completed in 1932 is undisputedly the most luxurious ship in the country offering a lavish Bicol themed cruise from the U.S to the Philippines.

The growth would continue throughout the 1930s as the country's shipbuilding industry slowly attracted customers from other countries, mostly from those neighboring the Philippines making the country a budding competitor in the industry.

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Aside from the commercial demand, one of the main driving forces for the maritime industry is the military. The Defense Department, one of the shipbuilding industry's largest customers, contributed a lot to many of the larger shipyard's successes.

One of these is Real Astillero de Bagatao, a company founded around 1910 whose owner took the name of the historical one that existed in the 17th century.

The Department had been putting orders on small patrol boats every year since 1921 for the Coast Guard with the goal of having 100% coverage of the country's coastlines by 1946 to prevent piracy and secure the country's maritime routes.

By 1924, the department had received approval to start their ambitious naval expansion and modernization program to increase the size of the navy to allow it to patrol as efficiently as possible the 9 maritime regions the navy outlined: 2 in the South China Sea, the Sulu Sea, 2 in the Celebes Sea, and 4 in the Pacific including around the island of Palau.

The budget for this naval expansion called an upgrade for the country's naval bases as well as the construction of the submarine bases. The submarines on the other hand are constructed in the United States under a technology sharing agreement where they would also provide expertise on submarine construction, maintenance, and operation.

For the first 5 years of the program, the country only ordered 2 of the required 18 vessels of the class, the Defensor class, due to budget constraints as they also needed to acquire destroyers and cruisers, which the navy planned to group into small task forces to be assigned to the marked maritime regions.

For the destroyers, the government had managed to sign an agreement on cooperation with Japan to enable the country to construct its destroyers on its own soil beginning with the Isla class, the first warship designed by Filipinos.

3 of the required 27 of the vessels were commissioned by 1930, the BRP Bagatao, BRP Guimaras, and BRP Corregidor, named after islands near where they were laid down.

The rest of the class are then planned to be built from 1930 at a rate of 2 per year.

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The plans for cruisers on the other hand went in limbo as the Department of Defense and congress debated on the addition of battleships to the budget.

Some members of the Defense Department believed that battleships are a symbol of national might and a source of national pride.

Congress on the other hand opposed this acquisition due to the extravagant cost of building, maintaining, and operating such large vessels. Although the topic was about battleships it eventually extended to the cruisers, which are still considered as a large warship by Philippine standards.

Members of congress insisted that the budget for the cruiser project should be diverted to research and development of aircraft, and improvements to the torpedoes as navy tests showed 80% failure rates making it next to useless.

They added that experts from both Britain and the U.S had predicted and demonstrated that battleships would eventually become obsolete in the near future due to the rise of air power. This is countered by the Defense Department by saying that the demonstrations were inconclusive as the ships used in the tests were unmanned.

The president, Francisco Liwanag, a former naval officer eventually broke the deadlock by convincing the Defense Department to back down and instead suggested to add more submarines and destroyers to the naval expansion program.

Aviation supporters of the military then suggested a proposal they have crafted after the congressional deadlock. Their proposal used Congress' favor towards aircraft development as an opportunity to recommend replacing cruisers with aircraft carriers.

Congress, however, were still unconvinced but remained amenable to the suggestion after the military advertised it as a perfect complement to aircraft by enabling the country to have a moving airbase in addition to the land airbases already planned to be built in the country's major islands.

The fate of the aircraft carrier program remained undetermined until the mid-1930s years after the major powers debuted their converted carriers, this coupled by the potential shown by country's aircraft development demonstrated the potential of carriers in defending the country's maritime territory.