Saturday, October 12, 2013

Aquino says Philippines strong enough to handle impact of US financial troubles Friday 11th of October 2013

From the Website of PIA - Philippine Informations Agency

Aquino says Philippines strong enough to handle impact of US financial troubles
Friday 11th of October 2013
BRUNEI DARUSSALAM, Oct 11 -- A potential US financial meltdown is unlikely and in case it happens, the Philippines is prepared to handle it, President Benigno S. Aquino III said on Wednesday.

"There are these several steps that have been done by both the economic cluster and the Bangko Sentral ng Pilipinas and they can explain the technical... the technical aspects of how we are cushioning the effects,” the President during an interview by the Philippine media at the Philippine Embassy here Wednesday.

"The world's biggest economy turns belly up, how can you actually protect yourself? But I don’t think that will happen," he added.

The President said even US Secretary of State John Kerry said that this is just an excess of politics in the US and every American politician knows the consequences of a prolonged government shut down and a default.

For his part, Finance Secretary Cesar Purisima said the default is something that is unthinkable, but nevertheless, the Philippine government is preparing for any eventuality by making sure that the country is in a flexible position such as in its liquidity position.

"Everyone’s affected, as the President said. But the good thing about the Philippines is that our OFWs are all over the world not just in the US," Secretary Purisima noted.

"Our BPO industry becomes stronger when times become difficult because of the need to become more competitive and more efficient, and then tourism is increasingly becoming an important consideration," he added.

The credit risk of the country has also improved as a result of recent investment rating upgrades, Purisima said.

"In fact, when we did the auction the other day, we borrowed at a lower cost than the US for the first time. This is an anomaly but it was—we borrowed for 90 days at one basis point; the US borrows at two basis points," he added.

President Aquino also said that in times of turmoil, investors try to find safe harbor, and bringing their money to the Philippines is better because of the country’s more stable financial environment. (





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