Manila - The Asian Development Bank (ADB) said Wednesday it
extended a 250-million-dollar loan to help strengthen the Philippine
government's fiscal management and reform programmes.
The Manila-based ADB said the loan will help the Philippine
government in dealing with the adverse impact of the recent
developments in the global economy.
It will also boost the government's efforts to implement measures
to strengthen the investment climate with focus on reducing red tape,
and support for infrastructure policy and rural development.
The bank said the loan is the second of a three-part Development
Policy Support Programme aimed at helping the Philippines achieve its
medium-term development goals. The first loan was approved in
February last year.
The ADB noted that while the government implemented a series of
programmes to improve fiscal imbalance, 'the surge in commodity
prices in early 2008, volatility of US financial markets and economic
slowdown in developed economies have negatively affected the
Philippine economy.'
'Despite the negative impacts, the Philippine economy has
weathered the external shocks well compared to some of our other
member economies,' said Kelly Bird, an economist in the ADB's
South-East Asia Department.
'This resiliency is due to the government's commitment to fiscal
discipline and key reforms, including tax reforms, the absence of
fuel subsidies in the national budget, previous trade reforms and
synchronized fiscal and monetary policies' he added.
Bird said the external shocks will challenge the government's
resolve to maintain fiscal and macroeconomic stability and
performance.
'The second loan addresses these issues through greater
flexibility in fiscal policy in 2008 and 2009, further enhancement in
tax revenue collection, and support for the government's conditional
and targeted cash transfer programme currently piloted as a way to
mitigate the worst effects of these shocks to the poor,' he said.
The ADB said the third part of the loan is expected to be
processed next year.
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