House inquiry on $1B pledge to IMF sought

MANILA -- A party-list lawmaker has filed a resolution seeking an inquiry into the country's $1-billion pledge to the International Monetary Fund (IMF) after it drew mixed reactions from various sectors.

Bayan Muna party-list Representative Teddy Casiño said the investigation should get to the bottom of the supposed confusing statements of the Bangko Sentral ng Pilipinas (BSP) regarding the loan for the ailing economies in Europe.

"Was this political posturing on the part of the BSP rather than a sound economic decision? Should the BSP concern itself with the Executive's flights of fancy?" Casiño said.

In filing House Resolution 2525, Casiño asked the House committee on banks and financial intermediaries to conduct an inquiry on the matter.

Also, Casiño slammed the administration of President Benigno Aquino III for its pronouncement that the Philippines is now a creditor country.

"The fact is, we are still a net debtor country, with total debt and National Government debt at an all-time high of $62.9 billion and P5.1 trillion, respectively," he said.

"Nobody ever claimed that the Philippines is now a creditor nation to the world," BSP Deputy Governor Diwa Gunigundo told Sun.Star in a text message Friday.

"We are a creditor nation only to the IMF. We paid all our obligations to the Fund in 2006 and we are making funds available to the IMF. On that basis, we are a creditor nation," he said.

Several lawmakers have criticized the country's pledge to IMF, saying the government could have used the money for public education, livelihood programs, and job generation.

While he admitted that the public sector remains in debt, Gunigundo said funds for debt servicing will come from the budget approved yearly by Congress.

"We are mandated by law to manage our reserves and to ensure their availability when we need it. We invest, we also lend to non-residents, including foreign governments and international financing entities that would include the IMF,” he said.

Earlier, Malacañang defended the decision of the BSP to pledge $1 billion of the country's foreign reserves, saying these funds cannot be used for social services.

The loan, according to BSP, will earn a 0.3 percent interest.

"The said 0.3 percent interest seems extremely low and may not give as much return if the $1 billion in international reserves were placed elsewhere," Casiño said.

The party-list lawmaker urged the House panel to look into Aquino's influence over the Central Bank and various policies concerning the $1-billion pledge.

"It should investigate if the loan was a product of political and not sound economic decisions," he added.

Casiño questioned the timing of the government's move to lend money to the IMF since the President has only a month away from delivering his third State of the Nation Address (Sona) scheduled on July 23.

"This loan is not just about the upcoming Sona, since the President had mentioned in his past speeches about the Philippines being a creditor nation, different from its past image of being a borrower," deputy presidential spokesperson Abigail Valte said.

"It is surprising that they are calling the government's goodwill as 'papogi' when these countries had helped the Philippines in the past,” she added.

Valte said Casiño has the right to file any resolution he desired. (Kathrina Alvarez/Jill Beltran/Sunnex)