MANILA, Philippines – Despite the looming recession in the United States and other major economies in Europe, the Philippines will not experience negative growth – at least until next year.
Owing to the policy of self-reliance, three strong sectors – information and communications technology (ICT), tourism, and mining – will carry the country through the global economic crisis, President Arroyo said yesterday.
Speaking at the Economist Conferences’ Business Roundtable at the Dusit Hotel in Makati City, Mrs. Arroyo said “there is no doubt that we live in unsettled times today.”
She warned that the setbacks from “the past year and the past weeks are real and profound, and it will take time and perseverance to put the pieces back together.
“Our economy is more resilient today than ever before. We have created almost seven million jobs in seven years. Our international reserves cover six months of imports and the reforms have given us some running room to weather the wave of global price shocks that reverberated across the world this year.
“It hasn’t been easy, but Filipinos are tough and resilient, and that is one of our sources of competitiveness,” the Chief Executive said.
She said the administration is doing everything it can to focus on the country’s fundamentals.
“Our banks are well capitalized and the innate conservatism of our bankers is matched by the prudential foresight of our regulators,” she added.
She said the country has been proving the value of a new paradigm for self-reliance through the use of first, a targeted strategy with a set of precise prescriptions to ease the price challenges.
“Second is rice self-sufficiency and more energy independence, and third, long-term reforms,” she added.
She noted that the ICT sector continues to grow from 4,000 jobs in 2001 to 400,000 today.
As for tourism, the country has many natural attractions that are gaining international recognition, she said.
In mining, the country has about $1.3 million in mineral resources.
Spending more
Mrs. Arroyo said her government would spend more to stimulate the economy and protect growth.
A shift in the concentration of the country’s exports to China from the United States would help minimize the impact of the crisis that originated from the US mortgage market a year ago, she said.
“We have drawn up our contingency plans to maintain our growth. Part of that is we have to pump prime, we have to spend, and to finance the spending... we have to increase revenues.”
Arroyo said the government would pursue plans to sell state assets to raise cash and fund infrastructure spending.
The country plans to sell its 40-percent stake, valued at about P25.7 billion ($542 million), in oil refiner Petron and a portion of its stake in oil and gas explorer PNOC-Exploration Corp. this year, she said.
“Privatizing our economy is a top priority,” Arroyo said. “We want to reap the rewards of our investments and use these rewards... to invest in the people.”
MANILA, Philippines – Bank bailouts, liquidity injections and interest rate cuts across the world have failed to quell investor anxiety over a possible global recession, she said.
Markets worldwide remained on a downward spiral, with the Philippines’ main stock index plunging 8.3 percent last Friday, its biggest single-day drop in 11 years.
“The best buffer we have to external vulnerability is our own domestic internal strength,” Arroyo said.
Fiscal reforms such as a higher sales tax and banking reforms imposed by the government after the 1997/98 Asian financial crisis would help the Philippines withstand the global financial storm, she said.
The Philippines is also now less dependent on exports to the United States than about 10 years ago, with China and Hong Kong combined now the Philippines’ biggest export market. – With Christina Mendez