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MANILA
has seen the last of the post-program monitoring (PPM)
scheme of the International Monetary Fund (IMF) and
starts today a whole new economic future in which the
fiscal sector will be closely watched under Article IV
of the IMF’s covenant with member-countries.
“IMF
visits, starting with this one, will no longer be as
sexy as they were in the recent past. Under Article IV,
we simply submit to once-a-year IMF visits for
surveillance purposes only,” Finance Undersecretary Gil
Beltran said on Friday.
An IMF
team under James Gordon flew into town over the weekend
to begin today a five-day economic review that used to
take at least two weeks to complete in the past.
The team
would still take a look at old performance benchmarks,
such as the public-sector borrowing requirement, which
in the past determined, for example, whether the next
loan disbursement was forthcoming or not.
This
time, however, Beltran said, good governance and fiscal
transparency are more important than mere adherence to a
set of IMF-defined numbers that had to be attained at
all cost.
Deputy
Bangko Sentral ng Pilipinas (BSP) Governor Diwa C.
Guinigundo, in a letter to the Department of Finance,
noted the biannual PPM was “no longer necessary” with
the full payment of
Manila’s
final loan obtained from the IMF.
Shortly
after the last IMF visit under the nonloan PPM in
November last year, the BSP advanced the payment of
Manila’s outstanding balance of $220 million and with it
paid in full the last of its obligations to the Bretton
Woods institution.
Were it
not for the collection problems of the main collection
arms, Beltran said, this visit would not be as exciting.
His
boss, Finance Secretary Margarito Teves, vowed to
convince the IMF on the adequacy of the existing revenue
measures keeping the lid on the budget deficit, seen to
end the year at only P63 billion.
Fears
have been raised the deficit would widen beyond its
programmed level for the year but Teves, in a planned
one-on-one meeting with IMF team leader James Gordon
this Friday, aims to assure him the asset sale proceeds
of some P100 billion should be more than enough of an
offsetting factor.
The
performance of the external sector, on the other hand,
has allowed foreign savings to pour into the country in
volumes sufficient to lift the country’s gross
international reserves to $26.4 billion as of end-June
this year.
The
full-year goal is to build foreign exchange reserves
amounting to $26.6 billion.
The
balance of payments (BOP), perennially in deficit till
only recently, has posted a surplus of $1.4 billion in
the first quarter and should remain in surplus well
above this level by yearend.
Past BOP
imbalances necessitated a string of loans from the IMF
that was finally broken early this year with the full
payment of the outstanding balance of $220 million. |
