‘RP will withstand crisis’

The outgoing International Monetary Fund (IMF) representative in Manila said yesterday the Philippines is in “a much better position” to confront the challenges posed by the global economic crisis.

Outgoing IMF Resident Representative Reza Baqir issued the statement following his farewell call on President Arroyo at the Music Room in Malacañang.

He was accompanied by his wife Zareen, who was born and grew up in the Philippines, and two-year-old son Shameer.

Also present were Finance Secretary Margarito Teves, Bangko Sentral ng Pilipinas Governor Amando Tetangco, and Agriculture Secretary Arthur Yap.

“This global economic crisis is going to pose challenges to all countries,” Baqir said.

“The Philippines today is in a much better position to handle these challenges precisely because of the important fiscal and economic reforms implemented by the administration.

“In particular, I am referring to the reforms of the value-added tax that was successfully implemented in 2005 and 2006,” he said.

He added that the country’s financial system is also strong enough to withstand the onslaught of the global economic crisis.

“There are many financial systems in the world which have experienced stress due to the turmoil in the financial market,” Baqir said.

“So far, the Philippines has not been one of those and Philippine banks have very little exposure to sub-prime,” he said.

Baqir, who also celebrated his birthday yesterday, described his tour of duty in the Philippines as “three-and-a-half wonderful years since July 2005.” He said he will miss wearing his barong.

Baqir will leave the country on Sunday and assume his new post as deputy chief for emerging markets at the IMF headquarters in Washington DC.

He was conferred the Order of Sikatuna with the Rank of Maringal na Lakan (Grand Officer) by the President for “his pivotal role and commitment in assisting Philippine policy makers in crafting timely and effective economic strategies through his expertise in macroeconomic and financial sector policy.”

Meanwhile, in spite of the global financial crisis, several Philippine export commodity groups posted gains in November last year.

In his report to Mrs. Arroyo, Socio-economic Planning Secretary Ralph Recto said the export gainers include machinery and transport equipment at 41.4 percent, processed food and beverages (28.5 percent), wood manufactures (24.3 percent) and forest products (188.1 percent). Forest products’ record reversed the previous month’s decline of 9.6 percent.

For agro-based commodities, positive growth was recorded by desiccated coconut (84.9 percent), sugar products (453.0 percent), pineapple concentrates (1.7 percent), abaca fibers (133 percent), unmanufactured tobacco (22.4 percent), and natural rubber (4.4 percent).

In contrast, merchandise exports dropped by 11.9 percent in the same period to $3.5 billion as manufactured goods, mainly electronic products, fell sharply by 9.2 percent as a result of the weakened demand of major markets due to the global economic turmoil.

The negative growth, however, was a slight rebound from the previous month’s negative 14.8 percent, but significantly lower than the negative 1.6 growth a year ago.

Despite the double-digit drop in the growth of merchandise exports for the second month in a row, total exports from January to November 2008 still managed to grow by 0.8 percent to $46.3 billion compared to almost $46.0 billion during the same period in 2007.  –Paolo Romero, Philippine Star