On the occasion of Araw ng Maynila, we trace the capital’s remarkable journey from ancient trading settlement to modern economic powerhouse
The roots of trade
Long before Spanish conquistador Miguel López de Legazpi established the colonial city of Manila on June 24, 1571, the banks of the Pasig River were already humming with commercial activity. The pre-colonial settlement of Maynila, ruled by Rajah Sulayman, was a thriving trading hub where merchants from China, Borneo, and other Southeast Asian kingdoms exchanged goods ranging from precious metals to exotic spices.
This strategic location at the mouth of the Pasig River, with access to both Manila Bay and the inland waterways, made Maynila a natural choice for commerce. The nilad plant that gave the settlement its name may have disappeared from the riverbanks, but the entrepreneurial spirit that first drew traders to these shores would prove to be Manila’s most enduring legacy.
The golden age of the galleon trade
The Spanish colonial period transformed Manila into the western terminus of the legendary Manila-Acapulco Galleon Trade, one of history’s first truly global supply chains. From 1571 to 1815, these massive ships carried Asian silk, porcelain, and spices across the Pacific to Mexico, returning with New World silver that flowed through Manila’s markets.
During this era, Manila became the economic heart of the Spanish East Indies. Chinese merchants established themselves in what is now Binondo, creating the world’s oldest Chinatown and laying the foundation for the city’s enduring role as a bridge between Eastern and Western commerce. The Parian, the original Chinese quarter, became a bustling marketplace where global trade converged in the narrow streets of colonial Manila.
American era: infrastructure and industry
The American colonial period brought modern infrastructure that would prove crucial to Manila’s business evolution. The construction of ports, railways, and telecommunications systems created the backbone for industrial development. The establishment of banks, insurance companies, and modern financial institutions transformed Manila from a trading post into a proper commercial center.
American investment flowed into sugar, coconut, and tobacco processing, while the peso’s stabilization and the introduction of modern banking practices attracted both local and foreign entrepreneurs. The Manila Railroad Company connected the capital to the provinces, facilitating the movement of goods and people that would fuel decades of growth.
Postwar renaissance and the rise
The devastation of World War II, which left Manila as the second most destroyed city after Warsaw, could have ended its commercial prominence. Instead, the post-war reconstruction effort sparked an entrepreneurial renaissance that laid the groundwork for modern Philippine business.
The 1950s and 1960s saw the emergence of Filipino business dynasties that remain influential today. The Ayalas expanded from their 19th-century distillery into real estate and banking. The Sys ventured from small-scale retail into shopping mall empires. Meanwhile, the Gokongweis built industrial and retail conglomerates that would span generations.
Makati’s transformation from rice fields to the country’s premier business district exemplified Manila’s post-war evolution. The development of Ayala Avenue and the construction of modern office towers attracted multinational corporations and established the template for the integrated business districts that would follow.
The BPO revolution: global Manila
The turn of the 21st century brought Manila full circle to its trading roots, but this time dealing in services rather than goods. The Business Process Outsourcing (BPO) revolution transformed Metro Manila into a global hub for customer service, software development, and back-office operations.
Companies like Accenture, IBM, and countless Filipino-owned BPO firms established operations across the metropolis, from Makati to Alabang to Eastwood City. This new form of trade—exporting Filipino talent and English proficiency to serve global markets—generated billions in revenue and employed millions of workers.
The rise of call centers and IT services companies demonstrated Manila’s ability to reinvent itself for the digital age, leveraging historical advantages like its American colonial legacy (which left widespread English proficiency) and its strategic time zone position serving both American and Asian markets.
Fintech and the digital future
Today, Manila stands at another transformation point. The rise of fintech companies like GCash and PayMaya has made the Philippines a leader in mobile financial services. E-commerce platforms and digital startups are choosing Manila as their regional headquarters, attracted by the city’s large consumer market and growing pool of tech talent.
The development of new business districts like Bonifacio Global City and the continued expansion of Makati and Ortigas reflect Manila’s evolution into a truly modern metropolis. These areas combine international-standard office space with world-class amenities, attracting multinational corporations and fostering innovation.
Challenges, opportunities and the future
As Manila celebrates another Araw ng Maynila, the city faces both familiar challenges and new opportunities. Traffic congestion, infrastructure gaps, and urban planning issues echo problems that have persisted for decades. Yet these same challenges drive innovation in areas like transportation technology, urban solutions, and sustainable development.
The COVID-19 pandemic, while disruptive, also accelerated digital transformation across Manila’s business landscape. Remote work capabilities, e-commerce adoption, and digital payment systems have reached new levels of sophistication, positioning the city well for future growth.
Climate change and sustainability concerns are driving new business opportunities in renewable energy, green construction, and environmental technology. Manila’s businesses are increasingly recognizing that long-term success requires sustainable practices and social responsibility.
Enterprise endures
From the Malay traders who first established settlements along the Pasig River to today’s tech entrepreneurs building world-class startups, Manila’s story is fundamentally about adaptation and enterprise. The city’s ability to reinvent itself—from trading post to colonial capital, from war-torn ruins to modern metropolis, from manufacturing center to services hub—reflects the resilient entrepreneurial spirit of its people.
As we commemorate the founding of Manila 454 years ago, we celebrate not just a city, but an idea: that strategic location, combined with entrepreneurial vision and hard work, can create prosperity that spans centuries. In boardrooms across Makati, startup spaces in BGC, and markets throughout the metropolis, that same spirit of Maynila continues to drive the Philippines forward.
The next chapter of Manila’s business evolution is being written today, in the decisions of entrepreneurs, investors, and policymakers who will shape the city’s next 454 years. If history is any guide, Manila will continue to surprise the world with its capacity for growth, adaptation, and commercial success.
Maligayang Araw ng Maynila to all who call this great city home, and to the businesses and entrepreneurs who continue to build its future.
