Palace: Philippines duty-bound to help poor nations
It is the Philippines’ obligation to help countries in dire need of funding through the International Monetary Fund (IMF), Malacañang said on Thursday.
Edwin Lacierda, President Benigno Aquino’s spokesperson, made the remark in response to a suggestion that the Philippines’ $1-billion loan to the IMF was rather risky for a country that continues to deal with hunger and poverty issues.
“We have been a recipient of IMF assistance for the past 40 years. Now, that we have been considered a creditor nation, we feel it is our obligation to assist those nations who require funding from IMF,” Lacierda told reporters in a news briefing.
“This would also help in stabilizing the crisis that’s going on in Europe. As to whether it is risky or not, we believe that IMF will act judiciously on the funds,” he added.
Lacierda said the IMF now has a standby fund for around $456 billion and the Philippines contributed $1 billion to that fund.
“It is our responsibility; it is part of our obligation [to the] IMF who has assisted us during our times of crisis in the Philippines,” Lacierda said.
In a separate statement, Bangko Sentral ng Pilipinas Governor Amando Tetangco said the Philippines will get returns from the loan it extended to the IMF.
“For nearly 40 years until 2006, the Philippines itself was a net borrower from the IMF. We finally fully paid our loans to IMF in December 2006 as the implementation of continuing reforms have made our economy stronger,” Tetangco said.
“Today, our economic fundamentals are sound, our banks are able to meet domestic credit needs, and we are capable of lending $1 billion from our international reserves to the IMF. This is a loan to the IMF and we will get our money back with interest,” he said.
“In effect, by extending a loan to the IMF that will earn money for the Philippines we are also able to help other nations saddled with financial problems. Other nations have also committed to help IMF address the current financial crisis,” he added.