Palace eases concern over BSP chief’s suspension

Malacañang sought to arrest yesterday the negative effect of the suspension order issued last week by the Court of Appeals against Bangko Sentral ng Pilipinas Governor Rafael Buenaventura and four other BSP senior officials.

Finance Secretary Jose Isidro Camacho told reporters in a press conference held after the meeting with President Arroyo that she appreciated and continues to appreciate the role of the BSP and the governor in stabilizing and strengthening the economy during her term.

However, she has not commented on the issue because of her administration’s policy to respect the independence of both the courts and the BSP.

"The President said this policy is paramount in maintaining the stature and effectiveness of these institutions, thereby securing the sustained confidence of the market," Camacho said.

"And she hopes the case would be resolved soon enough," he added.

Camacho admitted that the suspension of the BSP governor has had a negative effect on the business confidence in the Philippines.

"The case of the BSP governor, of course, has created some concerns not only in the business community but also the financial market," Camacho said.

But the finance chief gave assurances that Buenaventura is not being distracted by the CA ruling from performing his job in maintaining the stability of the peso vis-a-vis the US dollar, which has recently breached the P55 to $1 level.

The Palace earlier said this was a temporary phenomena due to the market jitters spawned more by the failed July 27 coup than the CA ruling.

Camacho revealed that he primarily met with Mrs. Arroyo in Malacañang to apprise her on the measures being undertaken by the DOF to deal with the residual anxieties in the Philippine’s business climate as a result of Oakwood mutiny.

"We are taking measures to normalize and stabilize the situation and in fact, it has been stabilizing as we see in the movement of interest rates, movement of our offshore bonds and even to some extent the stock exchange because the stock exchange has been able to recover part of the lost ground right after the incident at Oakwood," Camacho said.

"We’ve been working with the institution and the governor very closely to maintain a very high stable macro-economic environment," he added.

Camacho strongly brushed aside rumors of alleged Palace hands in the supposed ouster plot against Buenaventura, citing the fact that the BSP governor has a fixed term which would end in 2005.

"I am not aware of any such moves. And I think sometimes we create our own ghosts," Camacho quipped, stressing that he was himself the subject of recent humors that he is set to be axed from the Cabinet.