PHNO-BE: INSENSITIVITY, HYPOCRISY: $1-B NOYNOY LENDING TO IMF WIDELY SLAMMED

INSENSITIVITY, HYPOCRISY: $1-B NOYNOY LENDING TO IMF WIDELY
SLAMMED
[PHOTO FROM BULATLAT ONLINE
-Members of KMU and Piston hold picket in front of BSP Jun 25 to protest
Aquino's "pledge" to IMF and austerity measures.(Photo by
Marya Salamat / bulatlat.com]

MANILA, JUNE 29, 2012 (TRIBUNE) Written by Fernan J.
Angeles and Angie M. Rosales The Aquino administration's decision to plunk in $1
billion in the so-called firewall fund of the International Monetary Fund (IMF)
worth $450 billion for relending to European countries caught in a debt crisis
widely earned brickbats yesterday, including from senators who are demanding
explanations over the move.

Senators Gregorio Honasan and Ralph Recto
made identical demands for explanation from the Bangko Sentral ng Pilpinas'
(BSP) decision to allocate $1 billion to the fund, with Recto pointing out that
the BSP, as a creation of Congress, cannot claim sole propriety rights over the
country's dollar reserves and should seek consensus first or secure
appropriation cover from the legislature to make such a
commitment.


"The issue here is transparency because the taxpayers
have a say on this," Honasan, for his part, told reporters in an
interview.

"Transparency is a basic constitutional principle. That is why
a number of people were surprised to hear of this (pledge to IMF). We were also
surprised and that's all we want to know. We're not objecting to the (provision
of funds for the) loan. That loan (to financially ailing countries) might be
justifiable," he added.

Recto, likewise emphasized that he's not opposed to the move especially
since the BSP underscored the fact that the Philippines, as a member of the
global community of nations, has an obligation to ensure economic and financial
stability across the globe.

He stressed that he was willing to listen to
the "gameplan" of the BSP and why it would risk denying the Filipino people its
sovereign claim to $1 billion worth of projects and programs that could "change
their lives even for a little bit."

President Aquino's spokesman Edwin
Lacierda, instead of issuing an expalanation rattled off with the credentials of
BSP Gov. Amando Tetangco Jr. in justifying the BSP move.

"Tetangco has
been acknowledged last year as one of the best Central Bank governors. So it
shows the prudent management and the able fiscal stewardship of Bangko Sentral
under Governor Tetangco. And I am certain that he will not place the money of
the Philippines in an investment that is not consistent with making sure that
our money are fiscally preserved," Lacierda said.

Lacierda also bared
figures which seemed yielding surprising figures apparently dwarfing the one
billion dollar pledge as compared to the total gross international reserves of
$77 billion.

"How much are we loaning out to IMF? $1 billion over $77
billion. Look at the ratio... The $77 billion, we're able to conserve through
the year and that's because of prudent and prudent stewardship of Bangko
Sentral. I think, we should acknowledge the fact that they have done a good job
of increasing our reserves as well," Lacierda said.

Admittedly though,
Lacierda said that they can't stop opposition congressmen from investigating the
move while assuring government's sustained program designed to alleviate
poverty. He cited the Conditional Cash Transfer (CCT) program for the poor which
has reached P45 billion, as one of them.

Lacierda reiterated the IMF loan
is also meant to benefit overseas Filipinos, who work in European nations
struggling under the debt crisis.

"Overall, around $17 billion to $18
billion (in remittances enter the country each year) and remittances from our
OFW in Europe stand at $4-billion. We're investing $1 billion to the fund which
will help provide global stability," he said.

Honasan, however, insisted
on an explanation from the BSP as to how it handles the country's foreign
currency reserves.
"Can we convert these national reserves into poverty
allevation measures? Can we build roads from our reserves? This was not
transparent, that was the point. If we are under obligation, what are the terms
and conditions of that loan?," he added.
"That does not erase the point we
are raising. What standards were applied? Why just now? All of a sudden, we
provide these funds (to the IMF). There are more questions than answers (raised
by this issue). These are public funds, how come they were not told of this
plan?," Honasan further asked.

Honasan expressed belief that Malacanang
has an obligation to address the public on this matter.

"I agree with
that, the point raised by the Palace that we are capable of giving loans to
other countries. But try telling that to those who are hungry. That could buy a
number of sacks of rice," he said.

He said BSP's Congress-enacted mandate
is glaringly affirmed by the P40-billion infusion approved by Congress for its
recapitalization when it repudiated its old self, P20 billion of which had
already been appropriated in the past national budgets.

[PHOTO
COURTESY OF BULATLAT.COM- Playacting: Aquino's make-believe, protesters' lampoon
(Photo by Marya Salamat / bulatlat.com)]
Recto said the people must also be made to understand why the government is
lending out to IMF while it continuously borrows from international lending and
multilateral institutions for budgetary support and deficit spending.

He
stressed the $1-billion loan to IMF could be better used to bankroll projects
that have mass impact such as schoolbuildings, hospitals and other key
infrastructures.

Bayan Muna Rep. Teddy Casiño also called for changes in
the BSP charter to prohibit the president and finance officials from dipping
into the foreign currency reserves and lending public funds to foreign banks and
financial institutions like the International Monetary Fund (IMF) to the
prejudice and detriment of local enterprises.

Calling the plan a
"harebrained idea" and the "handiwork of Ivy-league bright boys in the BSP who
are salivating for positions in the IMF, World Bank (WB) and the Asian
Development Bank (ADB)," Casiño said the .3 percent interest to be earned from
the IMF exposure is miniscule compared to rates normally lent to local
enterprises, government agencies or local government units.

"The reserve
fund can also be used to finance common production facilities for industries,
postharvest facilities, manufacturing facilities, even renewable energy systems
that would boost the local economy," added the lawmaker.

"If we lend the
money to our local enterprises or to the government, the BSP would get higher
returns plus help boost the local economy. Its really more sensible, if not more
fun, to lend to our fellow Filipinos," he said.

He pledged to lead
efforts in the House to amend the BSP Charter to make it "more responsive to the
needs of the local economy."

Another militant solon, Gabriela Rep. Emmi
de Jesus describes Aquino's $1 billion pledge as the height of insensitivity and
hypocrisy.

The multisectoral group Freedom from Debt Coalition (FDC) said
the government extending a $l-billion loan to the IMF is an "arrogant pretension
of a country very much in debt".

In a protest action outside the BSP
building along East Ave, FDC members lambasted the government for "being fast in
allowing the IMF to manage our money, yet being slow in allocating funds for
basic social and economic services."

FDC sees this move as way of the
government to impress lender countries and credit rating agencies. With the $1
billion pledge, the government is in effect "flaunting the liquidity of its
coffers and seeking higher credit rating'' from Fitch, Standard a Poor and
Moody's.

Earlier, FDC had warned the public of misleading statements
issued by Tetangco and Lacierda who tried to make an impression upon the
Filipino people that the Philippines has now turned from a debtor country to a
creditor country.


Chief News Editor: Sol Jose Vanzi
© Copyright, 2012 by PHILIPPINE HEADLINE NEWS ONLINE
All
rights reserved




PHILIPPINE
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