Philippines cracks whip on state-run 'white elephants'
Philippines cracks whip on state-run 'white elephants'
Agence France-Presse/Manila
Government-run corporations blamed for contributing to a looming
fiscal crisis in the Philippines should reverse huge losses or
risk being abolished or privatized, President Gloria Arroyo's
spokesman said on Monday.
"The ball is in the court of the losing government firms,"
presidential spokesman Ignacio Bunye said in a statement.
He said the board and management of the companies in question
are being given a "fair chance" to turn around their performance
and make a profit or they will preside "over the abolition or
privatization of the hopeless cases."
"They must repay the trust and confidence bestowed upon them
by he national leadership and the people by meeting pressing
expectations of performance and managerial ability," Bunye said.
The warning came a day after Budget Secretary Emilia Boncodin
identified at least 15 government-owned and -controlled
corporations and financial institutions as being the most to
blame for Manila's ballooning debt.
The agencies, she said, were inefficient, have insufficient
funds to cover operations and money-losing subsidiaries while
their charters prevent them from increasing revenue.
Among those bleeding red ink are the state utility National
Power Corp. Others are the operators of two railway systems, the
irrigation administration, three housing agencies, officers
overseeing the tobacco and coconut industries as well as the
Philippine National Oil Corp. and the state-run Islamic Bank.
Boncodin on Sunday said the budget and finance departments
were to conduct a joint review of the firms before deciding what
to do with them.
The heads of these agencies should start looking for ways to
improve their finances as the government would no longer
subsidize "inefficiently run corporations," she said.
Among measures being considered are to merge money-losing
institutions with other firms, streamlining or deactivating them
and transferring some of their functions.
Arroyo has previously said the Philippines was "in the midst
of a fiscal crisis" amid a widening budget deficit and huge
debts.