Pardo, BSP chief plan roadshow 'to sell' RP

Finance Secretary Jose T. Pardo and Bangko Sentral ng Pilipinas (BSP) Gov. Rafael B. Buenaventura are planning to conduct an international roadshow "to sell the country" in preparation for government's foreign borrowing binge this year.

Pardo said yesterday they are planning to make a presentation to investors in Tokyo, New York and London sometime in March.

"The roadshow is intended to acquaint the international financial community with the new 'acting' team," he said.

Pardo admitted that the new economic team has to clarify several issues to regain the confidence of the international financial community.

One issue that needs to be clarified, Pardo said, was the recent decision of the BSP to impose a 90-day holding period for foreign investments.

He said that it appears there is still some confusion about the 90-day holding period as some analysts are claiming that this scheme has resulted in a 25-basis point increase in the coupon rate of Philippine bonds that are being traded in the secondary market.

The planned roadshow will be the first international presentation of Pardo who replaced former Finance Secretary Edgardo B. Espiritu last month.

Analysts said foreign investors still want to know what are Pardo's policies compared to those of Espiritu.

Espiritu has been able to successfully tap the international bond market last year, raising about $2 billion from several bond flotations. Proceeds of the bond flotation helped finance last year's bigger-than-expected budget deficit.

Pardo earlier said the government intends to finance its planned budget deficit this year of P62.5 billion through 60 percent foreign borrowings and only 40-percent domestic borrowings.

Analysts said the international financial community wants assurance that there will be no radical change of policy for the entry of foreign investments, adding that a mention or hint of any capital control is enough to put off prospective investors from investing their capital.