Philippine finance secretary says politics harming economy

  • Business
  • Wednesday, 27 Aug 2003

MANILA, Philippines (AP) - Finance Secretary Jose Isidro Camacho said Wednesday that recent political turmoil that has preoccupied Filipinos is pushing down the value of the Philippine currency and dampening the economy. 

In a forum with the Foreign Correspondents Association of the Philippines, Camacho lamented the "everyday obsession of a Filipino - one looking for entertainment in the front pages of the newspapers.'' 

"The Philippines really has a much better potential than what is reflected. It's sad that we do it to ourselves,'' he said. 

The peso has been battered since last month's alleged coup attempt by mutinous troops and allegations of corruption and money laundering made by an opposition senator against President Gloria Macapagal Arroyo's husband. 

The Philippine currency weakened from 53.50 pesos to the U.S. dollar before the July 27 military mutiny to 55.45 pesos Tuesday, its lowest closing ever. 

Arroyo acknowledged Wednesday that the "unfortunate brew of destabilization and partisan politics'' has affected the peso. 

She said she has asked the central bank to "crack the whip on speculators and to use feasible monetary tools to stabilize the currency exchange market.'' 

"The challenge for us in government,'' Camacho said, "is to constantly try to refocus the attention of everybody, particularly the business sector, the financial markets and our public on the more fundamental issues, on what's going on in their lives ... and try to minimize the political noise that is so loud these days.'' 

Camacho said the economy performed well in the first quarter, referring to 4.5 percent growth in gross domestic product for the period.  

But he added he expects it to decline in the second quarter due to the effects of SARS, lower agricultural output and the Iraq war. 

Growth figures for the second quarter have not yet been released. 

Despite the military mutiny, Camacho said he expects the economy to gain strength in the second half with increased exports, more housing projects, expansion of small and medium enterprises boosted by government funds, plus increased consumption due to spending for next May's presidential election. 

Arroyo has announced she will not run in order to focus on her administration's priorities: fighting poverty, terrorism, crime and corruption. 

However, her political opponents - and some of her own party members - say she will change her mind. 

As a result, she has come under attack indirectly through charges of alleged wrongdoing by her husband, Mike, a lawyer. 

Opposition Sen. Panfilo Lacson, a presidential contender, accused her husband of keeping a secret bank account to hide money left over from previous election campaigns and alleged corruption. 

Mr. Arroyo has denied the charges and challenged Lacson, who is protected by parliamentary immunity, to file charges in court. 

Arroyo said she will not intervene to defend her husband. - AP 

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