A Commitment to Help Filipinos Help Themselves
Estrada, Joseph Ejercito, Presidents & Prime Ministers
Our country was in the midst of the Asian financial crisis when I assumed office last June 30. But the economic reforms initiated by my predecessor, president Fidel Ramos, enabled our country to withstand the storm better than some of our neighbors in the region.
The economy proved so resilient that today, our country continues to enjoy positive growth despite the crisis in Asia. In the region last year, only Singapore and the Philippines posted positive growth rates. Although our economic growth was not as strong as in the years before, it kept us out of a recession.
I am happy to report significant improvements in our critical Indicators. When I assumed the presidency, the exchange rate was 42 pesos to one U.S. dollar; reached a low of 44.6 pesos to the dollar in September; now it is 38 pesos to the dollar. Shortly after the beginning of my term, the Philippine stock exchange composite index was at 1,192; now it has hit the 2,100 mark, boosted by the strength of the peso and the prospect of lower interest rates. The interest rate itself steadily declined from 14.7 percent in July to 13.4 percent in December.
Another important indicator is the price of premium gasoline, which declined from 12.03 pesos per liter in July last year to 11.76 pesos per liter in December. We expect it to go lower still. Exports increased from July to October 1998 by 58 percent to USS 14.2 billion compared to USS 9 billion during the same period in 1997. Exports for the first eleven months of the year soared to USS 26.97 billion. With this, the country is on track to reach its USS 29 billion export target for 1998. All these establish an encouraging trend and improved market confidence.
Our overseas Filipino workers also greatly helped stabilize our economy. Their remittances amount to an average of $6 billion every year. This affirms that the skills and talents of Filipinos continue to be recognized abroad.
Not to be forgotten in the improved business condition was the signing of the social accord between the biggest major labor federations and employers' organizations. The accord, which contained a no-strike/no-lock-out provision, affirmed the maturity and social responsibility of our labor and management sectors, and this improved our industrial peace.
I also wish to take note of a number of significant developments that highlight the international business community's confidence in the Philippines.
1. Standard & Poor's, the most credible financial rating Institution in the world, has just upgraded their outlook for the Philippines from negative to stable and affirmed our country's foreign currency rating of "bb+" for long-term credit.
2. The government was able to raise fresh foreign funds with the successful issue of a $ 1 billion bond which was oversubscribed. This is the first successful foreign bond offering in Southeast Asia after the regional currency crisis.
3. We have 140 foreign investors who have registered their interest in long-term projects in the Philippines. Of them, 30% are totally new investors.
4. We also wish to announce that we are now assured of the continuous operations of the Philippine airlines. Pal has just concluded the agreement for former top executives of Cathay Pacific to form the new top management team of Pal.
To generate investments in the countryside, we have launched a pro-poor, pro-market and pro-countryside development economic program. We will also establish a nationwide large-scale food security project to jumpstart country development. It will be spearheaded by the national development company through the issuance of the p 50 billion economic recovery for agricultural productivity or ERAP bonds.
In the midst of all the difficulties we have experienced, we realized that we could solve all of our problems if we stayed and worked together.
This year (1999) will even be a more critical year for the economy. …