The peso on Tuesday traded near its all-time low of 56.22 to the dollar before closing at 56.20 at the Philippine Dealing System. It gained a little and closed at 56.16 to $1 yesterday.
Mrs. Arroyo sought to assure the public that the economy is sound and that "there is absolutely no sense in extreme scenarios."
"I raise a renewed warning against currency speculators, as well as boarders and profiteers," she said in a statement. "The transitory isolated military adventurism and excessive politicking" were also to blame, she said.
Mrs. Arroyo was referring to last week’s failed military plot to destabilize her government. Three Army captains linked to the plot are likely to face court martial.
Officials have said that investors are wary of the May 10 presidential vote, in which the President is seeking a full six-year term but is trailing behind movie star Fernando Poe Jr., a high school dropout, in opinion polls.
"So this (weakened peso) is temporary. That is what we have to remind them — the basic soundness of our economy," Mrs. Arroyo said as she gave assurances that the peso’s fall would not slump any further contrary to grim scenarios made by some quarters.
The President sought instead to highlight the bright side of the country’s economy at a press conference held yesterday at the multi-purpose hall of the Siliman University in Dumaguete City.
She specifically cited the 5.5 percent growth in the country’s gross national product (GNP) and the more than 23 percent increase in foreign investments in the Philippines recorded for the entire year of 2003 as proof of the strength of the economy despite the weakened value of the peso against the dollar.
Mrs. Arroyo noted with elation the new investments that were recorded in the Philippine Economic Zone Authority (PEZA) last month, which reached P9.1 billion, or 400 percent higher than the P1.8 billion recorded in the same month last year.
"This 23 percent increase in foreign investments and 400 percent increase in PEZA investments are signs of a strong economy," she said.
Mrs. Arroyo also stressed that there is no basis for doomsayers to warn that the Philippines might become another Argentina with the continued fall of the peso.
Certain foreign banks have allegedly warned that the peso may suffer the same fate as the Argentine currency in the wake of its continued depreciation.
"Our economy is sound and strong, there is absolutely no sense in extreme scenarios," she said.
"We can all help by staying calm and focusing on constructive economic endeavors and dealing with the effects of the oil price hike in the spirit of sacrifice and solidarity," she added.
For their part, Lakas-CMD congressman rallied behind Mrs. Arroyo in calling for sobriety to help cushion the fall of the peso.
In a joint statement, the lawmakers led by House Assistant Majority Leader Allan Peter Cayetano, Reps. Prospero Pichay Jr. (Surigao del Sur), Robert "Ace" Barbers (Surigao del Norte), and Exequiel Javier (Antique) said that now is the best time for political candidates to contribute to the stability of the nation by rejecting the use of smear campaign tactics.
Meanwhile, the Koalisyon ng Nagkakaisang Pilipino (KNP) chided the President for justifying the free fall of the peso, claiming that the real reason for the local currency’s sharp dive is her "excessive pre-election campaigning that has induced the market’s shrinking trust and confidence."
Former press secretary Rod Reyes, who heads Fernando Poe Jr.’s media bureau, said though that he agrees that the peso’s downward spiral is only artificial. The KNP, he said in a statement, believes that the local currency would stabilize once the Arroyo administration is replaced by a more credible leadership that could win back the trust and confidence of the business community. — With AFP
Reported by: Sol Jose Vanzi
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