| Aquino stresses need for sustained reforms PLEDGES to stamp out corruption and implement sweeping reforms were reiterated by President Benigno S. C. Aquino III in his second State of the Nation Address (SONA) yesterday, a focus he stressed was needed for the Philippines’ growth.Central to his nearly hour-long speech was a revised take on a policy announced shortly after he became president: a ban on government officials’ use of “wang-wang” (sirens). The issue was yesterday elevated to a societal malaise. “Ang panlalamang matapos mangakong maglingkod -- iyan po ang utak wang-wang (Abusing privilege despite promising to serve -- this is the wang-wang mind-set; this is the mind-set of entitlement),” Mr. Aquino said. “Do you want the corrupt held accountable? So do I. Do you want to see the end of wang-wang, both on the streets and in the sense of entitlement that has led to the abuse that we have lived with for so long? So do I. Do you want to give everyone a fair chance to improve their lot in life? So do I,” he added, in Filipino. He announced the appointment of retired Supreme Court Associate Justice Conchita Carpio-Morales as the new Ombudsman, replacing Ma. Merceditas N. Gutierrez who resigned in May amidst controversy over her handling of cases. Mr. Aquino, in his speech, lauded Ms. Carpio-Morales -- who was part of the audience in the Batasan Complex -- and said he expected more graft cases to be filed this year against those who had abused their positions. “Inaasahan ko nga po na sa taon na ito, masasampahan na ng kaso ang lahat ng nagkuntsabahan sa katiwalian, at naging sanhi ng sitwasyong ating inabutan (I expect that within this year, we will have filed cases against the corrupt and their accomplices, those who caused the situation we inherited),” Mr. Aquino said. There was no direct reference to former President and now Pampanga Rep. Gloria Macapagal-Arroyo, whose administration has been criticized by Mr. Aquino as having fostered corruption. Cases against former Arroyo administration officials, among them Ms. Gutierrez, are being pursued. Mrs. Arroyo, who did not attend yesterday’s SONA, was rushed to the hospital late yesterday for a still-undisclosed ailment. Mr. Aquino admitted that he was taking the fight against corruption personally, saying the view should be adopted by every Filipino. “Personal dapat ito sa ating lahat, dahil bawat Pilipino ay biktima nito (It should be personal for us all as every Filipino is a victim),” he said, adding that the mind-set of sweeping things under the rug should be abandoned. The appointment of Ms. Carpio-Morales was no surprise; she has enjoyed Mr. Aquino’s trust since he became president, having administered his oath of office instead of Chief Justice Reynato S. Puno, whose appointment by Mrs. Arroyo just before her term ended was faulted by Mr. Aquino. In his speech, the president outlined what he referred to as the result of the campaign against the wang-wang system, pointing out that fiscal prudence and a review of programs and projects had led to the more efficient use of scarce government funds. “The budget is the clearest manifestation of the straight path upon which we tread. I say to those who would lead us astray: if you will further disadvantage the poor, do not even think about it. If all you would do is to fill your own pockets, do not even think about it...,” said Mr. Aquino, in Filipino. In an echo of his first SONA, Mr. Aquino spoke of past indiscretions in state-owned firms, citing millions of pesos in bonuses received by officials of Philippine National Construction Corporation. He also provoked laughs in pointing out that Philippine Amusement and Gaming Corp. had spent P1 billion on coffee alone. “At P100 per cup, that would be ten million cups of coffee over the last several years. Where did all that coffee go?” he asked. Mr. Aquino spoke of holding local governments accountable, and criticized the private sector as also having adopted thewang-wang mentality. “Mukhang marami rin po kasi ang nagwawang-wang sa pribadong sektor (It looks like a lot in the private sector have the wang-wang attitude,” he said, pointing out that with around 1.7 million self-employed and professional taxpayers, the P9.8 billion in taxes paid last year would mean each one paid only P5,783 and were earning just P8,500 per month. Reform efforts, he claimed, have led to fewer Filipinos going hungry, more jobs, record stock market gains, and successive credit ratings upgrades by Moody’s, Standard & Poors, Fitch Ratings and the Japan Credit Ratings Agency, among others. Touching briefly on the legislative agenda, Mr. Aquino thanked Congress for passing priority measures such as compensation reforms at state-owned firms and the postponement of this year’s Autonomous Region in Muslim Mindanao elections. He enjoined legislators to pass the 2012 budget before the year ends, noting that the early approval of the 2011 General Appropriations Act had allowed the government to implement needed interventions. “The timely passage of the budget allowed projects to be implemented more quickly. Tomorrow we will deliver to Congress our budget proposal for 2012. I look forward once again to its early passage so that we can build on our current momentum,” Mr. Aquino said. He also touched on the Spratlys dispute with China, declaring: “Wala tayong balak mang-away, pero kailangan ding mabatid ng mundo na handa tayong ipagtanggol ang atin (We do not want to start a fight, but the world must know that we are ready to defend what is ours).” Of his future agenda, Mr. Aquino cited the following: due compensation to the victims of Martial Law; granting house help the salaries and benefits that they deserve; improving the pension system for retired soldiers; expansion of the scope of science scholarships; advancement of universal quality health care; responsible environment management and facilities for calamity mitigation; and the development of the Bureau of Corrections, National Bureau of Investigation, National Electrification Administration and state-owned PTV 4. “Iyan naman po talaga ang plano: siguruhin na patas ang laban, itigil ang panlalamang ng mga makapangyarihan, at tiyakin na ang dating sistema na kung saan nakikinabang ang iilan ay magiging bukal na oportunidad para sa lahat (This has always been the plan: level the playing field; stop the abuse of authority; and to ensure that the system where just a few benefited becomes a source of opportunities for all),” Mr. Aquino said. “Tinutuldukan na po natin ang wang-wang: sa kalsada, sa gobyerno, sa kalakhang lipunan. Ito po ang manganganak ng kumpiyansya na magdadala ng negosyo; ito rin ang sisiguro na ang pondo ng taumbayan ay mapupunta sa dapat nitong kalagyan: imprastruktura na titiyak sa tuluyang pag-angat ng ekonomiya at pagmumulan ng trabaho at serbisyong panlipunan na sisigurong walang mapag-iiwanan (We are putting an end to the wang-wang attitude: on the roads, in government, society as a whole. This is what will foster confidence and business; it will also ensure that the people’s money goes to where it should: infrastructure that will ensure sustained economic growth, generate jobs and public service that will make certain no one is left behind).” -- JPDP |
| U.S. Stocks Extend Declines as Lawmakers Wrangle Over Federal Debt Plans U.S. stocks retreated, pulling the Standard & Poor’s 500 Index down from a two-week high, as Republicans and Democrats wrangled over separate plans to raise the federal debt limit and avoid a government default.Phone companies led losses among 10 groups in the S&P 500, losing 1.4 percent. Kimberly-Clark Corp. slipped 2.1 percent after reporting a decline in second-quarter profit, hurt by higher commodity prices. E*Trade Financial Corp. jumped 5.6 percent after agreeing to hire Morgan Stanley to explore a sale. The S&P 500 fell 0.6 percent to 1,337.43 at 4 p.m. in New York after slumping as much as 1 percent. The index rallied to within 1.4 percent of a three-year high last week. The Dow Jones Industrial Average lost 88.36 points, or 0.7 percent, to 12,592.80 today. “The market is trying to balance the macro risks of the debt ceiling negotiations and European contagion with good company earnings,” Rafi Zaman, managing director of global equities at DuPont Capital Management in Wilmington, Delaware, said in a telephone interview. His firm oversees about $26 billion. “The market is so volatile and moving depending on what’s in the forefront.” Negotiations over the nation’s debt limit have whipsawed stocks. The S&P 500 jumped 1.6 percent on July 19, the biggest gain since March, amid optimism President Barack Obama and congressional Republicans would agree to raise the ceiling before the Aug. 2 deadline. Stocks fell the next day on concern a Senate plan to help the nation avoid default faced resistance from House Republicans. Treasury Yield Four Basis Points From Two-Week High Before Obama Address Treasury yields were within four basis points of a two-week high as President Barack Obama prepared a television address seeking to break the impasse over how to raise the U.S. debt ceiling and avoid a default. Traders increased bets on inflation, driven by concern the U.S. will have its debt rating cut, weakening the dollar and increasing costs in the economy. The Treasury is scheduled to sell $35 billion of two-year debt today, the first of three note auctions this week totaling $99 billion. “A weaker dollar would result in higher inflation,” said Tomohisa Fujiki, an interest-rate strategist at BNP Paribas Securities Japan Ltd. in Tokyo. BNP’s U.S. unit is one of the 20 primary dealers that trade directly with the Federal Reserve. “Most market participants don’t see the risk of a default but they do see the possibility of a downgrade.” Benchmark 10-year yields were little changed at 3 percent as of 9:43 a.m. in Tokyo, according to Bloomberg Bond Trader pricing. The 3.125 percent security maturing in May 2021 traded at 101 1/32. The rate climbed to 3.04 percent on July 21, a level not seen since July 11. The yield compares with the 10-year average of 4.05 percent. Japan’s 10-year bond yielded 1.09 percent, compared with this year’s low of 1.06 percent set July 19. |
Oil Trades Near Two-Day Low in New York on U.S. Debt Ceiling Stalemate Oil traded near a two-day low in New York on concern a failure to reach a deal on raising the U.S. debt limit may cause the nation to default.Futures were little changed after declining for the first time in five days yesterday. Republicans and Democrats prepared dueling plans on how to tackle the country’s $14.3 trillion debt and quell fears of a default on Aug. 2. An Energy Department report tomorrow may show U.S. crude stockpiles dropped for an eighth week, according to a Bloomberg News survey. “Everything is so focused on the U.S. debt ceiling that there isn’t much more to the movement in crude than that,” Matt Smith, a commodities analyst for Summit Energy Services Inc. in Louisville, Kentucky. “Unless we see some sort of resolution, we’re going to continue to be choppy this week with an emphasis to the downside.” Crude for September delivery was at $99.14 a barrel, down 6 cents, in electronic trading on the New York Mercantile Exchangeat 8:53 a.m. Sydney time. The contract yesterday slipped 67 cents, or 0.7 percent, to $99.20, the lowest since July 21. Prices are 26 percent higher the past year. Brent oil for September settlement fell 73 cents, or 0.6 percent, to $117.94 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark contract settled at a premium of $18.74 a barrel to U.S. futures, compared with a record close of $22.63 on July 14. |
Sources: Bloomberg, Reuters, www.inquirer.net, www.philstar.com, www.bworldonline.com, www.cnnmoney.com
BDO UNIBANK INC.
Jonathan Ravelas
Chief Market Strategist
(632) 858-3145
Rhys Cruz
Junior Researcher
(632) 858-3001
