RP GROWTH NOT DIMMED BY HIGH OIL PRICES, VOLATILE PESO - ARROYO
MANILA, September 30, 2004 (STAR) (AFP) - The Philippines' economic growth prospects remain on track despite rising oil prices and a volatile peso, which fell to record lows this week, President Gloria Arroyo assured the nation Thursday.
Arroyo said the bad news should not deter the country from undertaking major economic reforms and people should not be discouraged nor downhearted.
"Our steady growth prospects remain firm," Arroyo said in a statement.
She said the "reality of high oil prices and the vagaries in the exchange rates should be considered as challenges" to the country's resiliency and "determination to beat the odds."
"The passing headlines may dampen the spirit but these should not deter us from the prize we all seek -- a strong, vibrant and enterprising economy, even amids these critical moments in our nation and elsewhere," Arroyo said.
The peso on Monday fell to a record low of 56.45 to the US dollar and has been hovering near that level since. Government has blamed strong seasonal demand for dollars as well as a weakness in regional currencies for the peso's slide.
Economists, however, have warned that the country's growth prospects could be dampened by rising oil prices, which could trigger inflationary pressures in oil-dependent Asian countries.
Arroyo has also earlier admitted the country was in the midst of a fiscal crisis amid huge debts and a growing budget deficit.
Unless Congress is able to pass key tax measures, the country could experience "painful economic death" within two years, the president warned recently.
The government is aiming to limit the budget deficit to 197.8 billion pesos (3.6 billion dollars) for the whole year or 4.2 percent of gross domestic product but the deficit already stood at 111.1 billion pesos from January to August due to weak revenues.
Reported by: Sol Jose Vanzi
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