‘Economy can weather crisis’

Democratic institutions in the Philippines remain strong and the economy can weather shocks brought about by the raging political crisis in the country as a result of the impasse in the negotiations between Congress and the Supreme Court regarding the impeachment of Chief Justice Hilario Davide Jr.

President Arroyo gave this reassurance to investors yesterday amid concerns raised by the business community on the impact of the constitutional crisis.

In a statement released by Malacañang, the President cited that the Philippine economy has shown its resilience after the failed coup attempt last July 27 when mutinous soldiers took over the Oakwood Premier Ayala Center condominium in Makati City’s central business district.

"Our institutions have been shaken by untoward events since July this year but confidence has held up in the face of the overall stability and viability of our democratic system," Mrs. Arroyo said.

"We must continue to build on this by unity and reconciliation, resilience and faith in ourselves," she told the nation.

The peso took another dive early this week as fresh rumors of an impending coup circulated as a result of the impeachment bid against Davide.

Although Malacañang has given repeated assura-nces that the government is ready to quell any attempt to overthrow the government amid the political standoff between the legislative and the judiciary, market jitters persist.

Mrs. Arroyo, however, said the weakness of the peso is just temporary since the market was reacting to jitters caused by the latest "political crisis" that has shaken business confidence and provoked fears of a new military coup.

"While we cannot forestall all imaginable political crisis, what I can say is that we are diminishing the potential of violence that is attached to these," Mrs. Arroyo said.

"This should give enough confidence to the business sector that we are crossing the road to permanent stability," she added.

The President, herself an economist, reassured the public that the peso remains fundamentally strong to absorb the latest shocks.

Bangko Sentral ng Pilipinas (BSP) governor Rafael Buenaventura also affirmed yesterday that the country’s economic fundamentals "continue to be strong" and "internally driven by investment and growth consumption despite the "political noise" generated by such a divisive issue as the constitutionality of the impeachment of the chief justice,

Speaking at a CEO forum organized by Businessweek Magazine in Hong Kong, Buenaventura stressed that the government is sticking to its economic targets this year despite the shaky political environment ahead of the May 2004 polls.

"The Philippines has not deviated from its economic goals," he said.

The government is targeting a 4.2 to 4.5 percent growth in gross domestic product this year and 4.9 to 5.8 percent in 2004.

While the BSP governor admitted that the current political environment in the country has been "a little bit unwieldy and a little bit inefficient," he emphasized that "in the end, the process gets carried out."

Congressmen are seeking to impeach Davide for alleged misuse of government funds, a charge he has strongly denied.

The high tribunal is now hearing oral arguments on the legality of the impeachment complaint against Davide by the House of Representatives, which is set to submit the articles of impeachment to the Senate when Congress resumes on Monday.

But even with the specter of this new political controversy, Mrs. Arroyo pointed out the positive gains in security and development, combined with good governance "will continue to maintain macroeconomic stability."

As various groups took to the streets to stage massive rallies either in protest or in support of the Congress-led impeachment complaint against the chief justice, thousands of Army soldiers and the 17,000-strong Metro Manila police were placed on standby for anti-civil disturbances action.

Mrs. Arroyo also stepped in earlier to mediate in the controversy when she asked SC and Congress leaders to enter into a "covenant" to resolve the issue at the soonest possible time.

The President’s proposal for a "win-win" solution to resolve the impasse calls for Congress’ withdrawal of the second impeachment complaint against Davide in relation to the management of the Judiciary Development Fund (JDF) but will be allowed to continue its investigation of the issue. — With AFP