Philippine President Gloria Macapagal-Arroyo (PGMA), despite her master’s degree in Economics, continues to lead the country by borrowing more money to fund a government that continues to waste scarce public resources. Not only does the Arroyo Dispensation continue its tax-and-spend routine but it continues to rely on loans – both from foreign and domestic lenders – to keep itself afloat and finance pork barrel, overpriced equipment and services and even foreign junkets of the administration and its congressional allies. And worse, PGMA and the other Filipino national leaders, including the 14 or more declared aspirants for the presidential elections in 2010, behave as if there is no tomorrow and future generations will be able to pay off all the loans that the present system borrows to finance an albatross-like government budget, half of which is wasted due to graft and corruption.

This columnist has been writing “unsolicited advices” to the Philippine policy-and-decision makers to face reality and begin doing fundamental structural socioeconomic reforms. Now that inflation is climbing past 12-percent and oil prices are shooting past the proverbial rooftop, the Philippine economy cannot be sustained simply by borrowing more and relying on the Overseas Filipinos to remit more to pay off the government loans, if not the interest alone. This writer has been saying all along – in fact since the early 1990s – that The Philippines’ Foreign IOUs Are Beyond "Debt Management" But . . .

But nearly all of the Filipino national leaders continue to ignore the need to stop borrowing more, rolling over interest payment and to eliminate corruption in governmental activities. Here are some of the articles previously published online and in hardcopy editions of Filipino-American publications in Chicago, New York, Los Angeles and Washington, DC:

Why Philippine Presidents Refuse to Answer Love Letters that Discuss the I2D2 Option

Another Love Letter to President Arroyo (Part II)

The Philippine Government’s Credit-Card Type of Existence

Jobs Cannot Be Created by Press Releases Alone

The Filipino Version of the “Irrational Exuberance”?

The “Strong” Philippine Peso Is a Temporary, If Not a Manipulated, Mirage

And finally here are excerpts from a Reuters’ news article that amounts to confirmation of what this writer has been saying all along . . .

QUOTE.

Philippine inflation looms at long end, debt auction eyed

By Karen Lema
Reuters
First Posted 12:44:00 07/21/2008

MANILA, Philippines -- A bleaker inflation outlook would nudge longer-dated Philippine debt yields up around 5 basis points this week and keep yields steady at the shorter end of the curve, traders said Monday.

Investors are opting to park their funds in shorter maturities rather than longer tenors after the central bank last week said annual inflation, which hit a 14-year high in June of 11.4 percent, would remain at double-digits longer than previously thought.

"Yields will likely be steady this week due to lack of fresh leads, but there was continued upward pressure due to inflation fears," said a debt trader from a local bank.

"The central bank said annual inflation could peak at 12 percent and it was not ruling out further rate hikes."

The monetary authority, which raised rates by an aggressive half-a-percentage point last week, forecast annual inflation would peak at 12 percent later in the year or in early 2009 and warned that inflation was spreading across the broad economy.

The trader said market players were also waiting for the auction of 182-day and 364-day Treasury bills later for yield direction.

The government will sell P6.0 billion ($135 million) worth of six-month and one-year paper at an auction on Monday, and traders expect the bills to fetch an average rate of 6.65-6.7 percent and 6.75-6.8 percent respectively.

The government sold 182-day bills at 4.675 percent at the last successful auction on Jan. 21, and it sold 346-day bills at 6.747 percent at an auction on July 7.

Another trader said investors were also waiting for the outcome of the government's retail Treasury bond issue.

The public offer is open until July 29, and the trader said the government may later decide to reduce future debt sales if it raised a good amount of funds from the retail bond sale.

The Bureau of Treasury sold P9.124 billion worth of its retail bonds to banks . . .

UNQUOTE. # # #