STRENGTHEN MARKETS, TARGET PUBLIC SPENDING
FOR POSSIBLE FISCAL CRISIS - ANGARA

Responding to reports that the country's next president could inherit a fiscal crisis, Senator Edgardo J. Angara today urged Congress to pass pending financial reforms in order to promote market stability and shield the Philippine economy from external shocks, especially with the global economy still in a vulnerable recovering state from the financial crisis. He further urged Congress to carefully target public spending, focusing the country's limited resources to job creation and investments in human capital.

Former Budget secretary and University of the Philippines economist Benjamin E. Diokno had noted recently that Congress was continuously passing revenue-eroding measures despite the government's lackluster revenue collection performance.

In response, Angara said that "to counter the threat of a fiscal crisis, we must target our spending on basic infrastructure, education and health, housing and the environment. We should complement these activities with a vigorous research and development (R&D) and training program. These are proven ways to ensure sustained growth."

Angara, Chairman of the Senate Committee on Finance, said policy reforms on mobilizing domestic resources and strengthening the capital market should be a priority of Congress.

"The Philippine economy has strengthened. Our GDP has grown impressively, in fact the biggest since the 1990s. We have tamed inflation at a record low, contained our fiscal deficit and continue to benefit from strong OFW remittances. We must vigorously pursue a financial reform agenda, if we hope to further strengthen our capital market and ensure our sustained growth," he said.

The Senate recently passed the Pre-Need Code, principally sponsored by Angara. The law establishes rules to govern the operations of pre-need firms and provide protection to consumers. The Real Estate Investment Trust Act (REIT), which injects liquidity and stability to the property market by allowing investments in income-producing real estate, was also passed.

Angara is currently pushing for the Corporate Recovery Act, which seeks to improve insolvency procedures to make the debt recovery process more efficient and give insolvent companies a chance to recover from liquidation.

He is also working towards amending the charter of the Bangko Sentral ng Pilipinas (BSP) to adapt international best practices in banking supervision and other measures that will strengthen the regulatory and supervisory powers of the BSP over banks and other financial institutions. The goal is to provide better protection for depositors' interests and to avoid losses of the public funds.