IN THE PHILIPPINES during the past decade economic nationalism has fested itself, among other ways, in government policies aimed at Chin residents. As a foreign group of considerable economic strength whose pol cal allegiance is uncertain and whose willingness to be assimilated is popul doubted, the Chinese are a logical target for economic nationalist policies. Thus, the Retail Trade Nationalization Law of I954 has attempted to" Fil-ipinize" retailing by excluding the Chinese from that business, and the more recent Rice and Corn Trade Nationalization Law has a similar goal for the basic food industry of the Philippines. Present-day anti-Chinese economic legislation results from the convergence of four historical developments: Filipino cultural prejudice against the Chinese; Filipino nationalism; political relationships between the Philippine Chinese and China; and the prominent economic position of the Philippine Chinese. All these developments had their origins during the period of Spanish rule in the Philippines (i565-i898). This article considers only the origin of the Chinese economic position in the Philippines. An attempt is made to survey, in general and non-technical terms, the history of Chinese economic activities in the Philippines during the period from i850 to i898. It is argued that, although Chinese enterprise in the Philippines dates from a much earlier period, it is in the late nineteenth century that we can find the economic and social origins of the anti-Chinese policies of today. In i85o the Chinese in the Philippines could look back upon a history of several centuries in the archipelago. Chinese had traded amicably along the Philippine coasts for several centuries before the Europeans arrived there but it is not clear just when Chinese began to reside in the Philippines. It is known that the arrival of the Spanish in the late sixteenth century provided attractive economic opportunities which stimulated Chinese immigration to the Philippines in much greater volume than ever before. By the beginning of the seventeenth century there were over 20,000 Chinese in the Manila area-a number many times that of the Spanish settlers. The Chinese quickly moved into an important economic position. Chinese merchants carried on a rich trade between Manila and the China coast and distributed the imports from China into the area of central Luzon, to the immediate north and east of Manila. Chinese also acted as provisioners of Manila and other Spanish settlements, buying up food in the rural areas and