OFWs urged to invest in RP dev't

 

 

Finance Secretary Margarito B. Teves told foreign investors participating in the Philippine non-deal roadshows in the US that economic growth is "sustainable and stable" but the government needs migrant workers to actively invest in their own country to meet "long-term economic goals."

In a statement, Teves, who is still in San Francisco, said: "With remittances averaging $ 1 billion a month, the role of overseas workers is very different today than it was then years ago. Today, overseas workers are more than a source of income – they are an important part of our national development agenda." In the state of California there is an estimated three million Filipinos, more than half of the total Filipino population in the US. A bulk of the $ 13 billion remittances last year came from the US-side.

"Overseas remittances are providing more funds for bank lending to help grow small and medium enterprises – the backbone of our economy and also raising the foreign exchange reserves required to support our country’s robust economic growth," said Teves. He added that overseas Filipino workers’ investments will "drive the nation forward."

"(The government) can only meet long-term goals if there is a sharing of responsibility between the government and business, and a commitment of higher levels of private sector investment in our economy."

The Bangko Sentral ng Pilipinas has long proposed the issuance of retail treasury bonds exclusively for OFWs to raise more funds to fund infrastructure programs. The BSP said a $ 1-billion offering of Treasury bonds can be easily absorbed by the OFW community.

The non-deal roadshows in the US and Europe is an opportunity for government officials to brief investors abroad about the Philippines’ fiscal and financial position.

With Teves are Budget Secretary Rolando Andaya Jr. and BSP Managing Director Cyd Tuano-Amador.

The purpose of these non-deal road shows is to update international markets of developments in the country, including fiscal positions, the new budget, higher growth targets and improvements in tax administration.

The National Government went back to the global bonds market last January raising $ 1 billion, the first and last commercial borrowing for the year. Governments borrow from the international markets in aid of fiscal deficits. The financing requirement this year is $ 3 billion. The rest of dollar sources will come from official development assistance (ODA) funds.

The country’s sovereign credit is still below investment grade, which means Philippine bonds are speculative buys. For example, credit rating agency Moody’s ratings for both long-term and short-term ROPs (sovereign bonds) is "B1" while Fitch has a "BB" rating for foreign currency and a "BB+" for local currency issues. In the meantime Standard & Poor’s credit score is "BB-" for foreign currency and BB+ on peso bonds. Moody’s, S&P and Fitch Ratings each attached a "stable" outlook on RP credit.

Teves will also visit Washington to meet IMF and World Bank officials. The roadshows are sponsored by JP Morgan, Citigroup, Deutsche Bank and Credit Suisse First Boston.

 

http://www.mb.com.ph/BSNS2007041491799.html