PESO ON ARTIFICIAL SPIRAL, SAYS GMA
MANILA, February 4, 2004 (STAR) By Marichu Villanueva - President Arroyo expressed concern yesterday that the "artificial spiral" of the Philippine peso vis-a-vis the US dollar would adversely affect Filipinos, especially in the light of the latest round of fuel price hikes.
The President aired this concern after the peso dipped further at the close of trading yesterday, hitting a new low of 56.22 to $1.
"The peso is on artificial spiral, taking the brunt of the problem created by too much politics and electioneering," Mrs. Arroyo said in a statement issued by Malacañang.
"I am concerned about the adverse effects to the average Filipino," she added.
Mrs. Arroyo, an economist, cited in particular the effect of the peso-dollar fluctuation on the prices of gasoline and other refined fuel products, which are being paid for by the country in dollars.
"As to the rise in oil prices, we have to bear with the vagaries of the free market even as we draw up safety nets for consumers and commuters," she pointed out.
"Transport companies are gathered around bulk discounts to keep fare costs at the lowest possible levels for the longest possible time," the President said.
Mrs. Arroyo assured the public that oil price fluctuations "will pass" as the winter season oil stockpiling ends in other parts of the world.
She said that despite the continued weakening of the peso, the strong growth of the country’s economy would hopefully cushion the adverse effects of political bickering and electioneering on the peso as well as the latest incidence of aborted military adventurism.
"We must work together to bring down the political temperature, pull up sobriety and stability and focus on platform rather than politicking," Mrs. Arroyo said.
"Messing up this campaign by smear tactics and black propaganda will only aggravate the uncertainties that are pulling the peso down," she warned.
Mrs. Arroyo, who is seeking a full six-year term in the May 10 elections, reaffirmed her personal commitment to lead by example to her political opponents.
"I am taking the high road of governance and the opposition must present alternatives," she exhorted.
Presidential Spokesman Ignacio Bunye justified yesterday the measures being implemented by the Bangko Sentral ng Pilipinas (BSP) to cushion the effects of the country’s maturing foreign debts amid further weakening of the peso.
Bunye said the BSP is the chief monetary policy-making body that is empowered by law to implement measures to protect the country’s currency and finances.
"It is irresponsible to inject in this matter of public interest. We are in need of additional funds to cover the government’s debt servicing cost and to sustain vital programs of economic development and social equity, to protect the welfare of the average Filipino," Bunye said, obviously to deflect claims by the political opposition that there were attempts to manipulate the currencies market to present a very strong peso under Mrs. Arroyo’s leadership.
Speaking over government-run Radyo ng Bayan yesterday, deputy presidential spokesman Ricardo Saludo stressed that the decline of the peso vis-a-vis the dollar since Mrs. Arroyo took over the government in January 2001 was merely four percent compared to the administration of her predecessor, when the currency plummeted by as much as 24 percent.
Saludo explained that when former President Joseph Estrada assumed office in 1998, the peso averaged 42 to the greenback and fell to as low as 55 to the dollar when he was deposed in 2001.
He stressed that the drop from P55 in 2001 when Mrs. Arroyo took over to the present exchange rate of P56.22 represents only a mere four percent drop.
Saludo also blamed excessive politics and the recent "Kawal" destabilization attempt as the principal culprits in the latest downward spiral of the peso.
Administration lawmakers echoed this view and called on the public to end speculations about destabilization moves against the Arroyo administration.
Lakas-CMD Reps. Monico Puentevella of Bacolod City, Allan Peter Cayetano of Taguig-Pateros, Wilhelmino Sy-Alvarado of Bulacan and Aurelio Umali of Nueva Ecija, said that now is the time to work together to save the financial markets and the peso.
Reported by: Sol Jose Vanzi
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