ECON CRISIS
MANILA,
APRIL 18, 2012 (PHILSTAR) - By Lawrence Agcaoili - Multilateral
lender International Monetary Fund (IMF) yesterday said the Philippines would be
the laggard in economic growth among the Association of Southeast Asian
Nations-5 (ASEAN-5) this year and in 2013.
In its latest World Economic Outlook (WEO), the IMF said the country's gross
domestic product (GDP) would grow 4.2 percent this year and 4.7 percent in 2013
after slackening to 3.7 percent last year from 7.6 percent in 2010 due to weak
global trade and cautious spending by the Aquino government.
The projected GDP growth this year for the Philippines is slower than
Indonesia's 6.1 percent, Vietnam's 5.6 percent, Thailand's 5.5 percent and
Malaysia's 4.4 percent.
For next year, the country's GDP forecast is also lower than Thailand's 7.5
percent, Indonesia's 6.6 percent, and Vietnam's 6.3 percent but is at par with
Malaysia's 4.7 percent.
The IMF sees the GDP in ASEAN-5 expanding by 5.4 percent this year and 6.2
percent next year from 4.5 percent last year.
The multilateral lender sees the GDP in Asia growing six percent this year
and 6.5 percent next year from 5.9 percent last year as activity across the
region slowed during the last quarter of 2011, reflecting both external and
domestic developments.
In emerging Asia, adverse market developments were correlated with countries'
reliance on euro area banks.
Euro area banks have already begun reducing their cross-border lending. Asian
banks are generally in good financial health and many large Asian banks have
sufficient capacity to step up lending further.
Last month, IMF mission chief for the Philippines Vivek Arora said the
country would likely regain its potential growth rate of about five percent
starting next year after slackening last year due to weak global trade.
Arora pointed out that the fiscal stimulus as well as the monetary policy
stance of the Bangko Sentral ng Pilipinas (BSP) and strong remittances from
overseas Filipino workers (OFWs) would boost domestic demand.
Based on its latest outlook, the IMF sees inflation easing to 3.4 percent
this year before rising to 4.1 percent next year from 4.8 percent last year.
This is slower than Vietnam's 12.6 percent, Indonesia's 6.2 percent, and
Thailand's 3.9 percent but faster than Malaysia's 2.7 percent.
For next year, average inflation in the Philippines would be slower than
Vietnam's 6.8 percent and Indonesia's six percent, but faster than Malaysia's
2.5 percent and Thailand's 3.3 percent.
The IMF pointed out that the world growth economic prospect is expected to
improve in the second half of the year as a result of the combined policy
measures taken across developed and emerging market economies.
BERNANKE DEFENDS FED RESPONSE TO FINANCIAL CRISIS / NEW WB
PRESIDENT
[PHOTO - Federal
Reserve Board Chairman Ben Bernanke testifies before the US Senate Budget
Committee on Capitol Hill in Washington, D.C., in this Feb. 7 file photo. / AFP/Getty Images]
WASHINGTON, APRIL 16, 2012 (MALAYA
BUSINESS INSIGHTS) Chairman Ben Bernanke said Friday that the Federal
Reserve was left with few good options when it stepped in to shore up the
largest US financial institutions during the 2008 crisis.
Bernanke defended the central bank's actions to support insurance giant
American International Group and help with the sale of investment bank Bear
Stearns, during a speech to a New York conference examining the crisis.
While there were risks associated with that support, Bernanke said that the
billions of dollars in loans the Fed provided were backed by adequate collateral
and taxpayers did not lose money. And he noted that the Fed and other US
regulators are better positioned to deal with a crisis because Congress passed
an overhaul of financial regulations in 2010.
"The Federal Reserve's responses to the failure or near failure of a number
of systemically critical firms reflected the best of bad options, given the
absence of a legal framework for winding down such firms in an orderly way in
the midst of a crisis — a framework we now have," Bernanke said.
Some have criticized the Fed for helping rescuing those institutions rather
than letting them fail. They said the Fed sent a message: banks could expect the
government to bail them out after taking extraordinary risks that threatened the
larger financial system.
In his speech, Bernanke disputed this view. And he said the regulatory
overhaul gave the Fed new powers to wind down those institutions without
threatening the larger financial system.
Bernanke's speech didn't address the current state of the economy or the
Fed's recent policy action to boost growth. But he did emphasize that the Fed's
regulatory duties are just as important as that mission.
"Going forward, for the Federal Reserve as well as other central banks, the
promotion of financial stability must be on equal footing with the management of
monetary policy as the most critical policy priorities," Bernanke said.
After the speech, Bernanke was asked whether the Fed's low benchmark interest
rate helped fuel the housing bubble. The question was directed at policies under
former Chairman Alan Greenspan, who preceded Bernanke at the Fed.
Bernanke disagreed but said regulators must pay close attention to the
financial system when interest rates are low. The comment was Bernanke's only
reference to interest rate policies. – AP
NEW WORLD BANK PRESIDENT
By Richard
Adams in Washington
guardian.co.uk,
Sunday 15 April 2012 15.51
BST
Doctor in charge at the World Bank will have to revive the
patient
In a plot from The West Wing, Jim Yong Kim will take lessons
from fighting HIV-Aids and TB to running the financial institution
[PHOTO -Jim Yong Kim, American nominee for the World Bank president,
with US secretary of state Hillary Clinton and President Barack Obama in the
Rose Garden at the White House in March 2012. Photograph:
Brendan Smialowski/AFP/Getty Images]
It was Aaron Sorkin's The West Wing come to life: the White House solving a
dilemma with a dramatic move, plucking out an obscure but highly qualified
candidate for a crucial post.
Or so it seemed when Barack Obama put forward Jim Yong Kim as the United
States's nominee for president of the World Bank, the pre-eminent multilateral
development agency. Kim is all but certain to be approved by the bank's
executive board on Monday.
In any other year, the choice of a 52-year-old doctor who established
innovative programmes to fight HIV-Aids and tuberculosis would have been
applauded as progressive — especially as the bank's previous 11 presidents have
all been white men.
The difference is that this year, for the first time, the US nominee is being
challenged by a strong candidate from the developing world, Nigeria's finance
minister Ngozi Okonjo-Iweala.
The prospect of backing Okonjo-Iweala – a talented economist who rose to
become a World Bank managing director – must have tantalised the White House.
But political considerations force Obama to nominate a US citizen. Luckily, Kim
also has a backstory that makes him stand out.
Kim was born in Seoul in 1959, in a South Korea ravaged by war. Like many
others, Kim's family suffered greatly. His father fled from the north at the age
of 17 and never saw his family again. Kim's mother was forced to march 200 miles
to escape the advancing North Korean army, and lost her own mother.
"My family's experience has given me an unshakable optimism about what can
happen to the poorest people. You can start from humble beginnings and horrible
conflicts and go on to lead a life of dignity," Kim has said.
When Kim was five, his family emigrated to the US and settled in Iowa, where
his father, Nhak Hee, taught dentistry. His mother, Oaksook, received a
scholarship to study philosophy.
Kim thrived in the midwest, where he was quarterback on his school's American
football team and became interested in politics.
At the age of 12, Kim was campaigning in support of George McGovern, the
anti-Vietnam war underdog who won the Democratic nomination to run for president
in 1972.
McGovern was demolished by Richard Nixon but Kim says he loved his brush with
politics, and it left him wanting to go further. His father had other ideas, as
Kim recounted in a 2006 interview.
"I remember the first time I came back from college at Brown University, we
were driving in the car and my father, just making conversation, said: 'What do
you think you want to study?' And I said, you know, I think I want to study
philosophy – my mother was a philosopher.
"So he pulled the car over and said: 'When you finish your medical residency
you can do anything you want.' I think all immigrant families understand this to
an extent, that your parents want you to do something safe – to have a skill
that no one can take away from you."
Harvard offered a joint degree in medicine and anthropology, allowing him to
satisfy both aims, although he later admitted: "For me, going to medical school
was not the one thing in the world I wanted to do."
Kim wrote his PhD thesis on South Korea's economic development. In a recent
article in the Financial Times, Kim said: "I have seen how integration with the
global economy can transform a poor country into one of the most dynamic and
prosperous economies in the world."
But the difficulties of healthcare in the developing world were what first
concerned him. At medical school he became friends with another student, Paul
Farmer, and in 1987 they and others launched Partners in Health, a charity that
fought tuberculosis, first in Haiti and later in other hard-to-reach places such
as Siberian prisons.
That experience led to his appointment to the World Health Organisation,
where he became director of the HIV-Aids department.
Kim's time at the WHO included his championing of an initiative that could be
a template for his tenure at the World Bank: the "3 by 5" programme, aiming to
bring treatment for HIV-Aids to three million people in the developing world by
2005.
It was criticised as over-ambitious but Kim piloted the programme deftly
enough to bring it to fruition. Although the programme missed its 2005 deadline,
the task was completed by 2007 and remains a highlight in the global struggle
against HIV-Aids.
A return to Harvard followed, until in 2009 Dartmouth College named Kim as
its president, making him the first Asian-American to head an Ivy League
university.
Kim's brief time at Dartmouth gives few pointers to how he will perform at
the World Bank, although his administration has been criticised for failing to
solve a long-running problem with student fraternity "hazing" or bullying.
To his critics, Kim's CV in academia and the non-profit sector fails to
compensate for his lack of experience of finance and economics, given the World
Bank's vital role as a financial institution.
But Kim's biggest task will be reinvigorating an organisation that has spent
the past decade in the doldrums, through lacklustre leadership and a diminished
role.
Few can doubt Kim's commitment to social justice. As he once told an
interviewer: "I feel like almost every day I'm doing political social justice
work. That's what I do every day with my life."
Chief News Editor: Sol Jose Vanzi
© Copyright, 2012 by PHILIPPINE HEADLINE NEWS ONLINE
All
rights reserved
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HEADLINE NEWS ONLINE [PHNO] WEBSITE
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