Philippines maintains economic targets: Ramos

Philippines maintains economic targets: Ramos

MANILA (AFP): The Philippines is maintaining its economic
growth target of seven percent this year despite the battering of
the peso, President Fidel Ramos said Wednesday.

"I do not see, as of the moment, any need to revise our
economic targets," Ramos said in a news conference.

"We're still looking at a budgetary surplus, a single-digit
inflation, seven percent gross national product growth rate for
1997," he added.

The peso closed at 29.30 pesos to the greenback Wednesday,
1.03 percent lower from a day earlier, dealers said.

It was down 10.98 percent from the level of 26.40 pesos to the
dollar prior to the government decision Friday to allow the
currency to trade in a wider daily band.

The Philippines has targeted a seven-to-eight-percent GNP
growth this year.

But analysts have cautioned growth could fall short of target
because of an expected slowdown in the manufacturing sector
resulting from higher interest rates.

Central Bank of the Philippines governor Gabriel Singson said
Wednesday the bank raised the average inflation rate forecast for
1997 to 8.5 percent from 5.2 to 5.7 percent.

Finance Secretary Roberto de Ocampo said Wednesday that the
peso crisis was "fleeting" and the situation was expected to
stabilize within the next "10 days to two weeks," based on
previous experience.

"This should not undermine our economic prospects, as much of
the financial community in the world continues to see bright
prospects for our tiger cub economy," De Ocampo said.

His office on Wednesday released data showing that the
government posted a budget surplus of 4.5 billion pesos (US$155
million) in the six months to June.

The finance chief dismissed persistent comparisons with the
Thai economic woes, saying that "in the long run," stable
Philippine economic fundamentals will be a bulwark against
foreign currency speculators threatening southeast Asian
economies.

Overexposure by Thai banks in the overheated property sector
was among the main reasons for the financial crisis there, which
resulted in the floating of the baht.

But De Ocampo said loan exposure by Philippine commercial
banks to the property sector was 10.9 percent as of end December
1996, compared to 13 percent for Thai banks and 30 percent for
Thai financial companies.

He said that since the peso was effectively devalued on
Friday, there had been "no wild swings" in the local currency
against the U.S. dollar.