Gov’t won’t waste good prospects, says Palace

Malacañang said yesterday it was aware of the challenges to make economic development trickle down the poor and that it would not waste the opportunity to change the people’s lives for the better by instituting reforms.

Deputy presidential spokesperson Abigail Valte said in a press briefing the World Bank’s report on the Philippines was welcome as it cited the country’s strengths along with the weaknesses.

Valte admitted it would take time before gains could be felt especially given the high oil prices and other factors.

Valte said WB’S report on the Philippines titled “From Stability to Prosperity for All” underlined the efforts of the Aquino administration to push fiscal and institutional reforms.

“As we continue to move towards inclusive economic growth, we agree with the World Bank on the need of reform in key areas, which we are acting on,” Valte said.

“In terms of strengthening public financial management, the report itself stated that significant reforms have already been

implemented. Our continuing efforts to streamline public budgetary processes are aimed at improving the efficiency and effectiveness of the budget,” she said.

Valte said the government’s tax enhancement effort and improvements in tax administration had also been commended.

“The Bureau of Internal Revenue’s highly visible tax compliance program has resulted in continued revenue growth without imposing higher taxes. And to further boost revenues and enhance competitiveness, we are also supporting the passage of excise and fiscal incentives bills,” she said.

“Economic indicators are encouraging. So far this year, exports have rebounded, inflation is down, job generation continues to improve, and public spending has been intensified and fast-tracked,” Valte said.

She noted all these had been possible, as the report correctly stated, due to “strong macroeconomic fundamentals, political stability, and a popular government that is seen by many as committed to improving governance and reducing poverty.”

“This is a manifestation of the Aquino administration’s vigorous and continued pursuit of fiscal and institutional reform, as we remain fully committed to the goal of more equitable economic growth,” Valte said.

According to the WB, strong macroeconomic fundamentals – that is low and stable inflation, manageable government finances, a central bank awash with dollars from remittances and foreign investments as well as a well-targeted social protection system–have strengthened the Philippines’ resiliency against the global turmoil.

The greater task at hand is accelerating reforms to put the country on a higher and sustained level of development that would significantly improve the lives of many poor Filipinos, WB said in its Philippines Quarterly Update (PQU).

“A huge window of opportunity currently exists for speeding up critical reforms,” WB country director Motoo Konishi said.

“Besides having strong macroeconomic fundamentals, the country is benefitting from political stability and a popular government that is seen by many as strongly committed to improving governance and reducing poverty,” he said.

For 2012 and 2013, the PQU’S growth forecasts for the Philippines are 4.2 percent and five percent, respectively.

The PQU says strengthening public finances and overall competitiveness are needed for the country to achieve rapid and sustained growth of above five percent for a long period of time. This was the level of growth achieved by neighboring countries that led to greater poverty reduction and improvement in the lives of the poor.