, December 16, 2005
(STAR) By Marianne Go - The Arroyo administration gets a passing grade from the Philippine Chamber of Commerce and Industry (PCCI) for its overall performance in 2005.

The government’s passing performance this year also gives the PCCI optimism for a positive outlook in 2006.

In its yearend press briefing yesterday, the PCCI gave the Arroyo administration credit for trimming the budget deficit and minimizing kidnapping incidents.

According to PCCI president Donald Dee, the Arroyo government got a high grade for keeping the budget deficit below the P180-billion target.

Dee pointed out that keeping the budget deficit below the target took a lot of political guts on the part of the administration.

The Arroyo administration, he noted, made the difficult decision to reduce its expenditures at the expense of lower growth.

Dee acknowledged "the political noise the whole year has made it very difficult for proper and effective governance. But despite the distraction, the government has been able to focus on what needs to be done to correct the deficit."

The government, Dee said, had to restrain expenditures, thus reducing the projected GDP (gross domestic product) growth of 5 percent. GDP growth is now expected to be between 4.2 and 4.3 percent.

"Had the government released the funds, the economy would have performed better," Dee added.

However, Dee said, by choosing to control expenditures, the government was able to rein in the deficit. Dee stressed this was "the right move, sending the right signal to investors."

Thus, for its efforts to control the deficit, Dee said, "the government deserves a high grade."

On the peace and order situation, Dee said, the government has also done a good job in the south of resolving the insurgency problem with the help of Malaysia as a mediator.

In fact, the PCCI is optimistic that by the first quarter of 2006, the problem with the MILF could be settled.

As for the peace and order situation, specifically kidnappings in the National Capital Region, Dee observed there had been some decrease in such incidents compared to last year.

But the Philippine National Police (PNP), Dee observed, has "fallen behind and we have not seen any major catch."

Additionally, Dee said, the business sector would also like to see some real convictions of arrested kidnappers.

Overall, Dee concluded, "the Arroyo government deserves a passing grade." He added: "By and large, we have a positive outlook for 2006."

Dee expressed hope that on the political side, "the politicians will realize the importance of handling the situation of the country very carefully."

The PCCI head warned, though, "if we are not perceived to be stable, foreign direct investments will not come in."

Chief News Editor: Sol Jose Vanzi

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