Malacañang Palace welcomes Philippine's investment-grade outlook from Barclays

July 7, 2012: Malacañang Palace on Saturday welcomed investment house Barclays' outlook that the Philippines may achieve investment-grade level in the next 12 to 18 months due to the continued improvement in the economy's fundamentals.

Presidential spokesman Edwin Lacierda said this may complement the government's efforts to set a level playing field to attract more investments, so there will be more funds for social programs.

"The credit ratings will be very positive for us because... it will be an opportunity for foreign investors to look into our country and see the consistency of our policies," he said on government-run dzRB radio.

"Maraming salamat naman (We are very thankful)... we're hoping this will happen," he added.

He said that from the start, President Benigno Aquino III and his economic team and the Bangko Sentral ng Pilipinas already laid down the premises for the economy.

Despite the difficulties of global economy, he said the administration made sure the domestic economy is doing well.

Lacierda also noted the development comes as the government expects greater agriculture production and infrastructure spending in the second quarter of 2012.

On the other hand, Lacierda sought to downplay the role of the Arroyo administration in the upgrade, saying that while there were two upgrades under former President Gloria Arroyo's watch, there are two aspects to foreign credit ratings – fiscal policy and governance.

He said credit agencies recognized the Aquino administration not only for its fiscal policies but for its governance as well.

"They see this president (Aquino) is free, untainted by corruption. They see the consistency of rules being laid out. Most especially transparency ng pamahalaan nakita ang ginagawa, these are consistent with 'tuwid na daan',"  he said.

On Friday, state-run Philippines News Agency cited a research note by Barclays Research hinting at investment grade level for the Philippines in the next 12 to 18 months.

It said Barclays Research also projects an outlook upgrade from Fitch Ratings to "positive" from "stable" in the next three to six months following this week's upgrade by Standard and Poor's (S&P) of the country's rating to BB+ from BB-, which the research note said is "already expected."

But the research note also cautioned that "it may take a little longer for it (the Philippines) to receive such a rating from two out of the three main agencies."

"We remain constructive on the medium-term outlook for the Philippines given its improving political stability, progress in public private partnerships, increasing FDI interest and structural improvements, such as passage of 'sin' taxes by congress and an anti-money laundering bill," the PNA quoted the research note as saying.

GMA News

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Philippine Air force eyeing new bases in the South

Basa Airbase

The Philippine Air Force (PAF) is eyeing the establishment of additional bases within the next two to three years as focus will be shifted to territorial defense, an official said

"A strategic recasting" towards territorial defense will require "the drawing of new basing and relocation plans… the remapping of stations," said Lt. Gen. Lauro Catalino G. Dela Cruz, PAF commanding general, during the anniversary celebration of the service command.

Col. Miguel Ernesto G. Okol, PAF spokesperson, said on the sidelines of the PAF's 65th anniversary, that Lumbia Airport in Cagayan de Oro City has been "initially identified" as a potential site for a new base.

The PAF currently has eight air bases, namely, Clark, Basa, Col. Jesus Villamor, Danilo Atienza, Fernando, and Antonio Bautista in Luzon; Mactan Benito Ebuen in Visayas; and Edwin Andrews in Mindanao.

The new bases will "meet the challenges of a rapidly changing threat environment," said Mr. Dela Cruz.

Meanwhile, Mr. Okol said air force personnel will be relocated from the Danilo Atienza Air Base in Cavite to make way for civil aviation.

The Manila International Airport Authority has previously proposed to move the entire general aviation section to other sites, including the former US Naval Station in Sangley Point, in Cavite province. The transfer is aimed at decongesting the Ninoy Aquino International Airport, which shares a runway with the air force main headquarters in Villamor Air Base, Pasay City.

As this developed, the PAF anniversary celebration saw the revival of the fly-by -- a parade, and acrobatics presentation of around 40 air assets -- which was last held 15 years ago.

"We are reliving this golden tradition of the PAF… as we are the air force, we should be flying," Mr. Okol said in a separate statement.

"This also signals that we are regaining our strength and will soon be a potent force in our defense and security operations," he added.

Once a leading force in the region, the country's air unit had been struggling with an ageing fleet.

But the administration has been consistent in "acquiring new and potent replacements for our old and unreliable air assets," said Defense Secretary Voltaire T. Gazmin in his remarks during the celebrations.

"We are now very determined in our intention to modernize," he added.

The department has targeted to approve 138 modernization projects by the end of July, including three radars systems, 21 utility helicopters, 10 attack helicopters, four additional search-and-rescue helicopters, two long-range patrol aircraft, a special mission aircraft, three medium-lift aircraft and 12 lead-in fighters. These are expected to boost the air power in the next two years.

"We need to have potent and reliable air platforms for our air skippers and crew to operate and fly," Mr. Gazmin said.

The government has been building up its defense posture in light of territorial disputes in the West Philippines Sea, a resource-rich area claimed in part or wholly by the Philippines, Vietnam, Brunei, Malaysia and Taiwan.

The area also groups the Scarborough Shoal west of Luzon, a small reef that is within the country's exclusive economic zone but is also contested by China.

Businessworld Online

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