No reason to question Phl loan to IMF, Palace says

MANILA, Philippines - Criticisms of the Philippine government’s decision to pledge $1 billion from the country’s foreign reserves to lend to troubled economies in Europe through the International Monetary Fund (IMF) were pointless since the fund could not be diverted for local projects, Malacañang said yesterday.

Economist Solita Monsod and former national treasurer Leonor Briones said the government’s $1-billion pledge to the IMF smacked of an attempt to “impress” the international community with the country’s financial prudence.

Briones said the country was not even part of the Group of 20 or G-20 considered as major economies.

Monsod, on the other hand, scored the government’s failure to conduct a consultation before pledging $1 billion to the IMF.

She added that when the Philippines suffered during the Asian Financial Crisis in the 1990s, the IMF loan extended to the country came with severe conditions that further liberalized the country’s economy.

Monsod said the loan that Manila was willing to extend to IMF members must also come with the conditions that were imposed on the Philippines.

Briones said the country also had other debts to pay with World Bank and the Asian Development Bank.

However, deputy presidential spokesperson Abigail Valte and Presidential Communications Development and Strategic Planning Office Secretary Ricky Carandang explained the $1-billion pledge came from the country’s gross international reserves that were not spent by the national government.

“That is separate from our fiscal budget,” Valte said over radio dzRB. – With Jess Diaz