Warnings raised against dependence on loans

Vinia, Alecks,

One suggestion I hope reaches Briones, FDC, Alliance, etal with same advocacies re debt trap, borrowing cycle:

I suggest A Manifesto Against GMA’s Non-Stop Borrowing:

The GMA: STOP BORROWING Alliance issue a warning to all creditors who continue to grant loans to the Arroyo government that ALL LOANS GRANTED TO THE ARROYO GOVERNMENT SHALL BE CONSIDERED “ODIOUS DEBTS” AND DEEMED GRANTED IN BAD FAITH TO THE FILIPINO PEOPLE UNTIL DETERMINED AND PROVEN OTHERWISE BY A PEOPLE’S DEBT COMMISSION in accordance with the proposed Debt Relief Act . The Alliance shall form a de facto commission to monitor the governments borrowings and to issue warnings to creditors accordingly.

Notes:
“Odious debts,” are those incurred without the consent of the people, those which cannot have benefited the public, and whereby the lender must have been aware of the two preceding conditions. …proposed Debt Relief Act, a debt relief council could invoke “the relevant privileges” necessary to facilitate “cancellation of odious debt or restructuring of debts or both to ease debt payments.”Sen. Villar proposed a debt cap bill to curb the government’s “borrowing spree” that would set a ceiling on public sector debt. Under the plan, the total debt stock the government would be allowed to maintain could not exceed 75 percent of the GDP of the previous year.

http://www.odiousdebts.org/odiousdebts/index.cfm?DSP=content&ContentID=12518

jm y flagwaver, what do you mean by non-stop borrowing? Do you mean that always the National Appropriations Act (Budget) must provide for zero deficit? But when you cut the deficit by not borrowing that would mean reduced EXPENDITURES, who will absorb such reductions, don’t you think it’s more dangerous? How can you reduce further basic services when it’s already to the bottom? How can you not incur capital expenditures when we don’t have enough roads? Even the most riches nations incur deficit and resort to borrowings, what is important is our development plan when in a few years we will have a balance budget even if we increase our expenditures, it’ll be balanced out by higher revenues when we attained the desired GDP.

Maybe what Briones et. al. is saying is that our situation now is so dangerous, which is true, it is critical therefore that we hit the medium development plan as projected and okayed by worldbank and IMF (and other creditors). What is good for now is that our credit is still taken well, although our interest liabilities are higher than other countries because of so many uncertainties one of which is politics.

Nevertheless, whoever is our president, borrowings can not be avoided so long that we continuously incur BUDGET DEFICIT. By the way, if I remember right, the HIGHEST DEFICIT that we experience is during the time of Briones in ERAP administration, ‘am not so sure though.

Gwaping, gov’t has admitted P1.2 Trillion (wow!) lost to corruption in Gloria’s past 5 years at the helm. An average amount of P240 Billion (wow pa rin!) each year.

The latest world bank loan, at today’s exchange rate of P53.50 to the greenback, is a mere P10.7 Billion! Without corruption, we could have saved the loaned amount, and for the next 22 years, continue to improve the education system by infusing the additional P10.7B yearly into making our graduates probably the most envied in the world. And that comes from one year savings (P240B) from corruption alone! If we can only cut corruption by a half, we still achieve the same for 11 years. What we get instead is we get tied up for the next 20 years in paying back this new burden.

Without the attendant plunder, Gloria could have provided the required additional poverty alleviation funding of P47B, additional health funds of P8.2B, the additional P10.7B for education, and still have P174B for roads, bridges and ports. At the bottomline, you would have already improved your savings, therefore, the deficit, cut further our loan payments, pump-primed the economy, better-educated well-prepared workforce, you know the drift.

Yet we claim to be a poor country?

tounge, inanew, so when Gloria is out today, tomorrow there’ll be no corruption anymore? WOW! WOW again! Let’s get her out NOW NA!

Look, the deficit is calculated, it is anticipated in a legislative process, BLAME everybody not just GLORIA!

Ambuot,

Thanks, your points really clarify the issues regarding the debt burden. Interesting, in the Philippines the “National Debt Clock or Index” must be put beside the Human Development Index to illustrate clearly the humantarian, not just financial or developmental aspect of the national debt crisis — the cycle of borrowing, the automatic appropriations for debt servicing and endemic corruption.

When the government increased and expanded the consumer tax (RVAT), the government should have regarded these extreme sacrifice imposed on our overburdened people with an obigation to force the issue of putting a cap on debt servicing and channel funds to mission critical projects like hunger incidence and poverty alleviation.

It would take statesmanship with moral suasion to deal with int’l creditors and political will to deal with corruption. We have to meet our obligations, but within concience. Either way, we must bite the bullet.

Gwaping, your president rose to power on a platform promise that was supposed to make her very much unlike her immediate predecessor’s supposed corrupt ways. And what do you know, she really is very much unlike all of them. My God, she’s made Erap look like a saint and Marcos even pales in comparison with her pillaging of the people’s money.

Yeah you’re right, the deficit is calculated and anticipated… with the 30% kickbacks built-in! I’m not blaming Gloria alone, I also blame JDV, her coalition congressmen, all her department secretaries and their subalterns, AFP/PNP Brass, and people like you who worship the goddess of deceit, patron or thieves, icon of cheats. I won’t stop you from fooling yourself. Who said corruption will stop the next day we remove Gloria? Even your failed logic won’t save your wrong argument.

I will also subscribe to Juan M’s proposal of a People’s Debt Commission, complete with pressure groups that forewarns creditor organizations to monitor and audit how the loans are spent. I regularly visit ADB and I was told they have revised their lending programs, even their organization structures in debtor countries, specifically those in their “most corrupt countries hotlist” where the Phils. occupies either of the top two spots, because they are now making doubly sure the loaned money is spent where it should be.

Instead of the usual country-based organizations they now adopt smaller but more numerous project-based monitoring groups ensuring full feedback of all expenses connected to the loan.

Philippine bonds are not as attractive in New York today than say, last year. The last two local offerings were all rejected because banks wanted higher rates. The gov’t wanted to keep its “pogi” posture but in the end, just this week, succumbed to the pressure and sold at the bankers’ preferred rates. There goes the strong economic fundamentals folly.

Desperadong magkapera before the impeachment! O baka naman kulang ang pocket money ng mga nag-junket sa Europe? Magkano kaya ang asking price ni Garci for next year’s operations? Kwentuhan ng mga private bankers, bantayan daw si Iggy at Mike sa Spain dahil baka mag-sidetrip sa mga offshore banks at magdedeposito ng pinagnakawang pera.

Don’t you notice the dollars become scarce, therefore, more expensive everytime Mike Arroyo leaves for abroad, whether to “self-exile” in some plush Las Vegas hotel or “sacrificing” in Stanley Ho’s casinos?

What’s the rush in making this trip at a time when a volcano is about to spew havoc on a province in your country. Unless of course you find it very urgent that your inlaws be named saints immediately as if that is possible.

Or maybe “updating” your secret accounts stashed in Europe’s safe havens just can’t wait.

People’s Debt Commission, hmmmm, better they run for election so they’ll be sanction to manage our debt ‘di ba?