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THE
government said on Wednesday that the peso’s continued
depreciation is not yet a cause for alarm, as the
Department of Finance bared measures to prop up the
national currency, among them, speeding up the availment
of $900 million in program loans this year and slashing
bank fees to entice more remittances from Filipinos
abroad.
Executive Secretary Eduardo Ermita said in his weekly
news briefing that the poor performance of the stock
market and the peso’s reentry into the P45 level against
the US dollar due to high oil prices and inflation
concerns is to be “expected,” given such conditions.
“We can
see its effect, especially in our peso-dollar exchange
rate. From P42, it went to P43, P44; now it’s P45. But I
would say that this is not really cause for alarm, this
is just reacting to market forces,” Ermita said.
On
concerns about rising inflation due to higher prices of
basic commodities, Ermita stressed that President
Arroyo, an economist by profession, “is fully in control
of the situation and had given enough instructions to
the economic team to prevent a further increase in the
inflation rate brought about by these forces.”
In a
phone-patch interview with Palace reporters arranged by
Ermita, Finance Secretary Margarito Teves said the
weaker peso would “help speed up the availment” of the
government’s program loans for 2008 from financial
institutions such as the World Bank and the Asian
Development Bank worth $900 million.
“These
program loans are [for] quick disbursement worth $900
million for 2008. . . . This will add to the supply of
dollars and foreign exchange. . . . We will try to
accelerate our availment of these loans,” he said,
adding that the government is looking at accessing the
loans in the next three months at most.
Teves
said another peso-strengthening measure is the
privatization of the government’s remaining stake in
Petron and the Philippine National Oil Co.-Exploration
Corp., as “it is more likely that foreigners will buy
them in dollars and it will add to our foreign exchange
in our country.”
The
finance chief said the DOF will also “try” to further
reduce already low remittance charges, beginning with
government banks, to generate higher remittances from
overseas Filipino workers (OFWs).
“For our
OFWs, we will try to reduce the remittance charges of
our banks, starting with the government banks. It is
already low but we will try to do it as low as possible
to encourage our OFWs to continue sending their
foreign-exchange remittances to the Philippines,” Teves
said.
He
declined to estimate the effect of the depreciation of
the peso so far, saying the government would rather
“just look for ways to stem the peso depreciation
because it has an effect on our interest payments, loan
payments; our peso requirements would increase.”
To ease
the pain of high inflation, Teves said Cabinet officials
discussed the provision of additional calamity funds for
typhoon-stricken areas and the condonation of penalties
for government loans during a meeting in Iloilo City on
Tuesday.
The
Department of Agriculture, he said, continues to flood
affected areas with National Food Authority rice; while
the Department of Trade and Industry will monitor the
implementation of the Price Act in calamity areas to
prevent unwarranted increases in the prices of basic
goods.
“We have
problems in the short term, that’s why we are looking
for short-term solutions. Hopefully we can address this,
but it won’t be easy. It’s happening but we’re trying to
hold the fort by working on the short-term measures,”
Teves said.
For the
medium and long term, he said the government has to work
on improving the competitiveness of the export sector
and lower power cost, among others. |
