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REITERATING her confidence the country can maintain its
growth rate last year—which stood at 7.3 percent—even
with the global economic slowdown, President Arroyo
Wednesday clearly indicated she is determined that the
country have a balanced budget this year.
Speaking
at the at the Philippine Development Forum in Clark
Field, Pampanga, the President said the 2008 national
budget has been designed not only to act as a “buffer”
against external economic challenges but also to ensure
the government meets its balanced-budget goal two years
ahead of the original 2010
target.
She
affirmed her position a day after former central bank
governor Jose Cuisia Jr. said in an executive briefing
that the government should not be too obsessed with a
balanced budget this year, and added that several
countries are doing very well yet have “acceptable”
deficits. If having a balanced budget is just for
international posturing, the government should
reconsider and instead ramp up budgets for health,
education and other investments in human development,
said Cuisia, now chief executive officer of Philippine
American Life and General Insurance Corp.
However,
it seemed President Arroyo is set on fast-tracking the
goal of a balanced budget: “This budget represents
another important step in the economic development of
the
Philippines,
namely, fiscal discipline. We have the strongest economy
in 30 years as a result of tough reforms we have made to
break the cycle of despair which has held our nation
backward so many years. Part of the plan includes a
march toward a balanced budget for the first time in
many years.”
As if
responding to concerns that pursuing a balanced budget
this year could deny more funds for infrastructure
development, education and health services, the
President noted the budget is anchored on the “essential
building blocks” of nation building, namely, the
economy, education and the environment.
“Overall, the budget provides a buffer to mitigate the
pain of a deteriorating global economy and the
accompanying rise in prices which affects food and
transportation the most. Most important, it is a budget
dedicated to investing in the vital physical and human
infrastructure to continue to modernize our nation,” she
said.
The
President said that 2008 shows “real promise” as the
country is “well-positioned to weather a global economic
slowdown” because of its strong macroeconomic
fundamentals.
“Our
strengthened economic fortune comes none too soon
because as we are all aware, there are clouds in the
economic horizon that we must guard against. The global
economy is facing significant challenges. The slowing of
the economies in North America and Europe is top of mind
in our calculation to protect our own economy. To that
end, we have developed a program...to ensure certain
investments in people and infrastructure,” she added.
She will
provide “responsible targeted relief” for the poor to
help them cope with high living costs brought about by
external factors.
In the
fight against corruption, the President has ordered the
formation of watchdog bodies for the Bureau of Internal
Revenue and the Bureau of Customs with representatives
from civil society and the private business sector,
which will monitor tax collection and major BIR and BOC
cases.
In the
last two years of her presidency, she will push for the
enactment of laws to improve the banking and finance
system, strengthen tax collection, broaden the taxpayer
base and reduce corruption and red tape.
The
President said government use of Official Development
Assistance (ODA) will be guided by the “three Es
priority thrust of the 2008 budget as well as the need
to adjust foreign exchange flows to avoid excessive
upward pressure on the peso.”
“That’s
why we have been prepaying our foreign debt to the
extent that we don’t lose money on the penalty and,
that’s why we are also relying increasingly on the
domestic bond market,” she said. |
