PEACEFUL RALLIES BOOST MARKET
MANILA, MAY 3, 2006 (STAR) Stock prices rose 1.55 percent yesterday to the highest close in almost seven years as investors were reassured by relatively peaceful Labor Day protests, dealers said.
It was feared that mass protests by leftist groups on May 1 would result in violence but the day passed without major incident.
The peso also reacted positively by gaining 18 centavos to close at 51.60 to the dollar compared to Friday’s close of 51.78.
The Philippine Stock Exchange composite index added 35.11 points to 2,305.64 after trading between 2,270.53 and 2,313.74. This was the highest closing level since Aug. 5, 1999 when the main index settled at 2,348.24.
"Investors were relieved that contrary to expectations, Labor Day ended without any violence," Jose Vistan of AB Capital Securities Inc. said.
Dealers said they feel that most shares have been overbought and profit taking will likely emerge soon.
"Investors may start to cash in once first-quarter results start coming out," Vistan said, adding the earnings may have been hurt by higher taxes and rising commodity costs.
Meanwhile, the peso reportedly received a boost after Finance Secretary Margarito Teves said Moody’s Investors Service had agreed to reconsider its negative outlook on Philippine debt.
"Moody’s is willing to reconsider as long as we meet the target for this year and meet the value-added tax (VAT) collection target," Teves told reporters.
According to Bangko Sentral ng Pilipinas Governor Amando Tetangco Jr., the foreign exchange market had a "good two-way liquidity" with inflows more than enough to cover demand for dollars.
Inflows, according to Tetangco, were mostly from overseas Filipino workers as well as portfolio investments. "The demand was seen from oils and power companies," he said. "Plus the fact that the peso was also helped by firmer regional currencies." Job well done President Arroyo congratulated all sectors yesterday for the peaceful commemoration of Labor Day on Monday even as some protesters again pressed for her ouster and slammed the ban on demonstrations in Mendiola.
"We congratulate our workers for the meaningful and peaceful celebration of Labor Day, which reflects the political maturity of the Filipino upholding unity and hard work as the solution to the nation’s problems, not self-interest and incessant strife," Mrs. Arroyo said in a statement.
She said greater political stability and economic growth will push forward the welfare and benefits of Filipino workers.
"Payback time is here and we call on our people to further unite to stamp out political noise and elevate our common struggle against poverty, corruption and terror that are the bane of a just and progressive social order," she added.
The President also expressed appreciation for the enlightened stand of workers’ groups against destabilization attempts, saying that it speaks of the firm partnership between the government and the labor sector in improving the climate for growth, investments and jobs.
"I laud the Philippine National Police (PNP) and the Armed Forces of the Philippines (AFP) for their vigilance beside the people in maintaining law and order amid persistent threats of political mayhem," she said.
Press Secretary Ignacio Bunye said the designation of more freedom parks was a welcome development for both government and civil society.
"This ensures peaceful assemblies without disruption on the daily routines of a wide segment of the urban population," Bunye said.
He emphasized that freedom parks should not be viewed as a restriction of the right to free expression but guarantees that national and local governments would always uphold that right.
But left-wing workers from the Kilusang Mayo Uno (KMU) vowed to hold even bigger anti-government rallies later this month and in June.
Aside from demanding a wage hike, workers will protest the expanded value added tax (EVAT) and moves to change the constitution from a US-style presidential system to a parliamentary one, which KMU head Elmer Labog said would extend Mrs. Arroyo’s power.
Wage hike, not fringe benefits
In a nationally televised address on Monday, the President didn’t announce any wage increases but presented a package of benefits for workers, including scholarships, income tax exemptions for minimum-wage earners, and government health insurance and pension plans for farm laborers, fishermen, street hawkers and motorcycle drivers.
Opposition leaders at the House of Representatives, however, said that the P40 billion worth of non-wage benefits that Mrs. Arroyo gave to the working class are largely meaningless to most workers.
Minority Leader Francis Escudero told reporters that the package was taken from programs that are already in the pipeline and packaged as a new grant.
He cited that nearly half of the huge amount to be given to government personnel in terms of a salary increase is already in the 2006 budget, which the House approved last month.
"It is not a new grant as the administration would like to make it appear," he said.
He also clarified that what state employees would receive is an increase in monthly allowance, not a salary increase.
Escudero branded the President’s announcement as "misleading and deceptive." Part of the P40-billion package, he said, will also come in the form of scrapping penalties and surcharges on delinquent housing loans granted by the Social Security System (SSS) and Government Service Insurance System (GSIS).
But he maintained that these two pension funds should condone penalties and surcharges on loans without the President telling them what to do so and making it appear that workers owe her a debt of gratitude.
"These pension funds are like usurers. They collect not only interests and penalties and surcharges while losing billions of contributions from members in questionable investments such as the P14 billion they sank in Equitable-PCI Bank that is now worth only about half of that original investment," he stressed.
Besides, he added, a worker with no loan from the SSS or GSIS is not a beneficiary of the so-called non-wage benefits.
The opposition leader urged Mrs. Arroyo to support the proposal in the House for a P125-across-the-board increase in the daily minimum wage "if she really wants to help workers."
Like Escudero, detained Rep. Crispin Beltran of the militant party-list group Anakpawis described the grant of non-wage benefits as deceptive.
"The President’s Labor Day package will not make a dent in the lives of the toiling masses. For example, it will not uplift the welfare of millions of contractual workers, whose numbers are increasing by the day," Beltran said in a statement.
As for the President’s statement that she is allotting P100 million for the rehabilitation of the Philippine General Hospital, the former militant labor trader-turned lawmaker said it is the government’s duty to provide health services to the people.
"This package seems to me a false and deceptive gesture of charity. What workers need are substantial wage increases, not fringe benefits," he added. — AFP, AP, Aurea Calica, Jess Diaz
Chief News Editor: Sol Jose Vanzi
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