Gloria: Focus is on insulating RP


PRESIDENT Arroyo yesterday said her economic team is working hard to insulate the country’s economy from the financial crisis in the United States.

Arroyo said the economic team is focusing on managing the inflationary pressure to avert any continued hike in prices of commodities, and in sustaining economic growth to “continue to generate jobs and deliver the tax revenues we need to fuel our investment,”

She said the government is also strengthening the banking system to improve the fiscal health, encourage investment, sustain the economic growth and insulate the economy from the volatility in the world market.

“We have been working hard to make sure that food supplies remain stable. We’re working hard to make sure that there is food on the table of every Filipino. We have also been introducing measures to lift the burden of high fuel prices from our people,” Arroyo said.

However, details of the programs were not mentioned.

Arroyo convened her economic team Tuesday night in Malacañang to further discuss measures and to assess the impact on the economy of the developments in the US including the rejection of the US House of Representatives on the $700 billion bailout package.

Expected to attend the meeting were Budget Secretary Rolando Andaya Jr., Finance Secretary Margarito Teves, Trade Secretary Peter Favila, Bangko Sentral governor Amando Tetangco, Planning Secretary Ralph Recto, Agriculture Secretary Arthur Yap, and Energy Secretary Angelo Reyes.

Andaya foresees that if the US Congress continues to reject the bailout plan, the current economic crisis could worsen and be far worse than the Asian financial crisis of 1997.

He said this would mean among others, that the interest rates would go up and exports would shrink. The US is the biggest trading partner of the Philippines.

“Mas concern namin kung ano ang effect. What will be the negative effects if a bailout does not materialize? Of course, down the line new taxes would be one of the options,’ he said.

Sen. Mar Roxas called on the Bangko Sentral, the DOF and other government financial institutions not to keep the public “out of the loop” about the unraveling global financial crisis.

“Lack of information only causes uncertainty among the public. As long as the BSP and DOF communicate clearly with the people – from sophisticated investors to ordinary depositors – we are containing speculation,” he said.

Roxas, chair of the committee on trade and commerce, said more importantly, the economic managers must take stock of any impact of the financial crisis on the real economy, which may happen within a few months unless plans to plug these are put in place.

Roxas said that instead of panicking or taking imprudent actions, the government and private sector institutions should take this challenge as an opportunity to plan strategically for the future.

“We already know that global markets are changing in an increasingly dynamic and interconnected way. We all know that we cannot be in ‘business-as-usual’ mode forever,” he said. – Jocelyn Montemayor (Malaya)

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