WORLD  BANK  TO  REALIGN  $400-MILLION  FUNDING  FOR  RP  REHAB

[PHOTO AT LEFT - Displaced families stay in tents at an evacuation center in Botolan, Zambales as disaster-response agencies packed tons of food aid and prepared a massive evacuation plan amid another typhoon threat. JONJON VICENCIO |MANILA, Philippines]

MANILA, OCTOBER 21, 2009 (STAR) By Ma Elisa Osorio - The World Bank said it is willing to realign up to $400 million of its loans to the Philippines to help the country rehabilitate areas ravaged by tropical storm “Ondoy” and typhoon “Pepeng.”

“We have identified more options but we won’t take all the options, so it can be anywhere between $200 and $300 or maybe $400 million. It depends on what options the government takes,” WB Country Director Bert Hofman said in an interview on the sidelines of yesterday’s 35th Philippine Business Conference at the Manila Hotel.

Hofman explained that the amount would depend on how much the government would want to realign.

He said the fund is available immediately or once the government gives its go-signal.

He said that since it’s the government which is requesting for funding, the WB does not expect to encounter any difficulty in making some changes.

Hofman said they would only have to make some revisions in the legal aspect of the agreement.

“It’s very easy to do,” he stressed, adding that the changes may be ready in two weeks.

When asked which of the government projects would take a backseat, Hofman said they are looking at some options but said it would ultimately depend on the Philippine government.

One concrete example, Hofman said, is the irrigation management of the country. He said the board recently approved the restructuring of irrigation projects around the Philippines.

Hofman noted that the restructuring in areas not affected by the typhoons can be put on hold.

“Previously there were a number of irrigation systems earmarked for rehabilitation but they were not affected by the floods. Now some of them in the flood area have been affected so there may be reallocation,” Hofman explained.

The other project, Hofman said, is the extension of the Kalahi-CIDSS, the government’s anti-poverty and community development flagship program. Kalahi-CIDSS stands for Kapit-Bisig Laban sa Kahirapan-Comprehensive and Integrated Delivery of Social Services.

“There’s always been an idea to use Kalahi-CIDSS in urban areas so this may be a good tool to help out poor communities that have been hit but need to relocate to get them up to speed again, to get them up and running again,” Hofman said.

“A small grant for the communities, for them to decide how to spend it, that could be used for reconstruction,” he added.

Use debt payment funds

Meanwhile, Rep. Satur Ocampo of the militant party-list group Bayan Muna urged President Arroyo to use P700 billion in funds for debt payments for the rehabilitation of calamity-ravaged communities.

He said the government should suspend foreign debt payments in the wake of disasters that have befallen the country.

He said the Arroyo administration should use debt service funds for relief operations and for the reconstruction of communities devastated by typhoons.

“It would be the height of insensitivity and callousness if the government continues to allocate billions for debt servicing when the Filipino people are in desperate need of relief,” he said.

“It will take years to rehabilitate the damaged areas, and it will certainly take much longer for Filipinos severely affected by calamities to get back on their feet and recover physically, emotionally and psychologically,” he added.

Ocampo pointed out that now is the most opportune time for the government to negotiate a debt payment moratorium with its creditors.

Instead of begging the international community for more loans and grants, the country would have more money for relief and reconstruction if it suspends debt payments, he stressed.

Citing data from the Bureau of Treasury, Ocampo said that as of October 2007, the nation’s foreign debt stood at $39 billion or more than P1.5 trillion.

More than P700 billion is spent annually for debt payments, equally for principal and interest.

The Bayan Muna representative suggested that in seeking a debt payment suspension, the Arroyo administration may start with the Asian Development Bank and the International Monetary Fund.

He said part of the money saved could be used for the acquisition of modern equipment for weather forecasting and rainfall volume measurement.

“Scientific, efficient and reliable weather forecasting and broadcasting equipment is an important service that will save lives and help reduce the potential damage to infrastructure,” he said.

The weather agency said it needs at least five modern Doppler radars for weather and rainfall forecasting. Each radar costs about P100 million.

Earlier, Ocampo called on government officials and politicians not to steal funds intended for typhoon victims and their damaged communities.

“It is a mortal sin to steal from those who have lost everything,” he said. – With Jess Diaz

WORST TIMES:  RP  BUDGET  DEFICIT  WIDENS  TO P237.5 BILLION  IN  9  MONTHS

By Iris C. Gonzales - The Philippines is facing the worst of times, Finance Secretary Margarito Teves said yesterday as he announced that the country’s budget deficit has widened to P237.5 billion during the first nine months of this year, a sharp 345 percent increase from the P53.4 billion deficit incurred in the same period last year and just P12.5 billion shy of the full-year ceiling of P250 billion.

In September alone, the deficit hit P27.5 billion or 27.2 percent more than the P21.6 billion deficit incurred in the same month last year.

Teves attributed the widening of the deficit to weak revenues brought about by a slowdown in economic activities.

“We may be facing the worst of times but we are not giving up. With everybody’s continued support and cooperation, we believe that we will be able to hurdle these challenges,” Teves said.

He said the government is still hopeful it would meet its P250 billion budget deficit ceiling this year through the privatization of three major state-owned assets such as the Food Terminal Inc. property in Taguig, the government’s 40 percent stake in PNOC-Exploration Corp., and the government-sequestered 24-percent block in San Miguel Corp. by yearend.

Total revenues for the January to September period amounted P839.8 billion, short by P74.4 billion against its target for the period. Total expenditures for the nine-month period amounted to P1.07 trillion, lower than the program by P54.4 billion.

Of the total revenues, the Bureau of Internal Revenue (BIR) collected P557 billion, short by P39.2 billion against its target for the period. Similarly, the Bureau of Customs incurred a P36 billion program shortfall with total collection amounting to P165.4 billion during the period.

Proceeds from privatization reached P65.1 billion or lower than the program by P3.6 billion.

Only the Bureau of the Treasury reached its revenue target for the period, posting an income of P52.2 billion.

In September alone, revenues reached P100.7 billion, 12.3 percent more than the P89.6 billion it generated in the same period last year.

Expenditures, on the other hand, reached P128.2 billion or 15.2 percent more than the P111.3 billion it disbursed in the same period last year.

Of the total revenues, the BIR collected P56.2 billion, just slightly higher than the P55.8 billion it disbursed in the same period last year.

The BOC, on the other hand, collected only P18.3 billion because of the low volume of imports. This was lower than the P25.8 billion it collected in the same month last year.

Revenues from other offices reached P20.2 billion, also higher than the previous year’s collection of P5.9 billion while the Bureau of the Treasury collected P6 billion or higher than the P2.2 billion it collected in the same period last year.

Teves said that the two tax agencies need to work harder to be able to raise more revenues.

“We are really facing tough times. Our revenue collection efforts are seriously hampered by the slowdown in economic activities and tax breaks that were granted through legislation,” the Finance chief said.


Chief News Editor: Sol Jose Vanzi

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