Duterte seeks closer China and Russia ties
PHILIPPINES President Rodrigo Duterte will seek closer economic ties with China and Russia, as the local currency and stock market extended declines following Western criticism of his deadly war on crime.
The peso hit a seven-year low to the dollar on September 26 and foreign investors pulled out from local shares for a 23rd straight day, which analysts said was due to uncertainty over Mr Duterte’s handling of what has been one of Asia’s best-performing economies in recent years.
“I will open trade alliances with Russia and China so all you other investors, just go. No problem,” Mr Duterte said in a speech at the presidential palace.
Mr Duterte has attracted widespread criticism from Western governments and rights groups for a bloody crime crackdown has that claimed more than 3300 lives since he took office on June 30.
International credit rating agency Standard and Poor’s warned last week that Mr Duterte’s war on crime was threatening the Philippines’ economy and endangering the country’s democratic institutions.
It also said his unpredictable foreign policy and national security statements were other downsides that meant a credit upgrade for the Philippines was unlikely in the next two years.
Mr Duterte has responded with abusive comments against his critics over his war on crime, such as branding US President Barack Obama a “son of a whore” and UN chief Ban Ki-moon a “fool”.
The Philippines, a former American colony, had up until Mr Duterte been one of the United States’ most loyal and enduring allies in Asia. The two nations are bound by a mutual defence treaty.
Mr Duterte has repeatedly signalled he is looking to distance the Philippines from the US, but his latest comments were his most explicit that he was planning to pivot towards US rivals China and Russia.
Mr Duterte said he had privately already spoken with Chinese President Xi Jinping and Russian Prime Minister Dmitry Medvedev, although it was impossible to verify when the conversations had taken place.
The Philippine stock market fell 1.18 percent to close at 7632.46 points.
“Global funds sold Philippine stocks for a 23rd straight day amid nervousness about the fallout from Duterte’s anti-drug war and his outbursts against the US and the United Nations,” Bloomberg reported.
The local currency also fell 0.5pc to 48.25 to the dollar, touching its lowest level since 2009.
“[The peso’s decline is] mainly due to politics, with the Philippine president’s ongoing war on drug dealers and his intent to seem to alienate all of their major trading partners,” Jeffrey Halley, a market strategist at Oanda Asia Pacific Pte in Singapore told Bloomberg. –
Rodrigo Duterte is not concerned about losing US support.