Malacañang rejects suggestions to take back $1B loan to IMF

Malacañang on Saturday cast aside suggestions to use a $1-billion loan to the International Monetary Fund for other purposes such as shoring up defense or social services.   “Hindi pupuwede yan. Linawin natin ang $1 billion ni-loan, hindi ito binigay. Pautang ito, di ito binigay, at meron itong interest. Ang pangalawa, pinautang natin yan galing sa gross international reserves, hiwalay na pondo ito, hindi ito pondo ng national government,” deputy presidential spokesperson Abigail Valte said on government-run dzRB radio.   She said the law prohibits the use of gross international reserves for funding the national government’s programs. In a statement issued June 19, IMF managing director Christine Lagarde thanked contributors for responding to the IMF's call for concerted action to improve its ability to respond to global economic woes. "Countries large and small have rallied to our call for action, and more may join. I salute them and their commitment to multilateralism. As a result, total pledges have risen to US$456 billion, almost doubling our lending capacity," Lagarde said. 'Spend it here, not elsewhere'   Earlier, some lawmakers had suggested that the $1 billion be spent on anti-poverty programs or social services.   “Ang reserves hindi ginagamit na gastusin ng national government, hiwalay ang fiscal budget at reserve. Sa ilalim ng batas hindi pwedeng gamitin ang gross international reserves for programs of the national government,” Valte explained.   Valte also belied claims by critics that the Aquino administration is trying to shore up its image by extending the loan.   “Hindi tayo nagpapa-impress, hindi natin style yan,” she said.   Earlier this week, the Bangko Sentral ng Pilipinas said the country pledge $1 billion to help boost the IMF’s resources.   “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,” BSP Governor Amando Tetangco Jr. said in a statement.   “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,” Tetangco added.   Valte also said the loan could at least indirectly help OFWs in economically troubled countries, and eventually, the Philippine economy.   She said OFWs face the prospect of having their salaries lowered or their jobs cut, if their host countries experience economic trouble and do not get assistance from the IMF.   “Our economy is also reliant on OFW remittances, so ang pagtulong natin may balik sa atin,” Valte said. — ELR, GMA News