Speaking at the traditional vin d’honneur at Malacañang Saturday night, Mrs. Arroyo told the diplomatic corps that the country had gained the momentum to press forward to the path of development.
"We have firmly stabilized the domestic political situation while continuing to mop up residual problems in law and order," she said.
"We have infused to a great degree common sense, discipline and accountability in public management and public service while leaders of government, private sector and civil society have committed to undertake concerned effort to combat poverty and accelerate economic development," the President said.
Mrs. Arroyo said the economy posted a 3.7 growth in the first three quarters of the year despite the global economic slowdown.
"A significant turnaround, considering that less than a year ago, our economy was about to go into a tailspin in the wake of domestic instability," she said.
Mrs. Arroyo said 2001 was a year of rebuilding, reinvigorating and reshaping of democratic institutions, governance and economy and restoration of international confidence on the Philippines and the Filipino people.
"(The year) 2001 saw the restoration of moral authority in our government through the instrument of people power," she said.
Mrs. Arroyo said the world will continue to face challenges but with sufficient political will and cooperation, it would be able to weather the storm.
"As we have built a global coalition to eradicate terrorism, so too can we close ranks to lift the global economy...," she said. "The coalition that has been built and the relationship that has been fortified in our collective response to terrorism can and must extend to global, regional and bilateral economic reforms."
The Philippines stands ready to work with its friends and neighbors to meet the challenge, she added.
During the same ceremony, Apostolic Nuncio Antonio Franco extolled Mrs. Arroyo for her resolve and strength in facing the challenges of the past year.
"The path you have taken with courage and vision is indeed arduous," he said. "It does not bring easy successes. But in the face of the present chanllenges, you have manifested political will and tenacity in your drive to preserve the tenets of democracy. To safeguard the common good and to unite the various sectors and forces of society."
Franco, who is dean of the diplomatic corps, said 2001 was "replete" with historic events that were"decisive" for the Philippine and the whole world.
Franco said the Arroyo administration is a "new leadership" that asserted its determination to confront with resolve and efficiency urgent social problems confronting the Filipino people.
"(There is a) need for better international cooperation in the fight against all forms of evil and terrorism through a courageus and resolute political, diplomatic and economic commitment to relive situations of extreme poverty, oppression and discrimination," he said.