RP's 2000 economic goals are achievable: IMF

RP's 2000 economic goals are achievable: IMF

MANILA (AFX-ASIA): The International Monetary Fund (IMF) said the Philippines' 2000 gross domestic growth target for the year of 4-5 percent, its average inflation rate goal of 5-6 percent and its foreign exchange reserves target of over US$16 billion will be achievable if the government pursues its policy reforms and improves investor confidence.

"Developments to date suggest that these targets are achievable if macroeconomic policies remain on track, the reform agenda is vigorously pursued, and investor confidence -- which has been adversely affected by a combination of factors, including developments in Mindanao -- improves in the near future," the IMF said in a statement.

The IMF said it is close to completing its fifth review of the domestic economy and a successful completion will enable the country to draw about $325 million from the remaining funds of its $1.4 billion stand-by IMF loan.

The IMF added that the country's external payment position stands solid, reflecting a large current account surplus, a high level of foreign reserves and an improving maturity structure of external debt.

But under the IMF program, the key challenges include government being able to stick closely to its fiscal targets which will entail vigorous collection efforts by the revenue- generating agencies and careful monitoring and control of expenditures.

Other challenges include the passage of the power sector reform bill and the new Securities Act. The former will help ensure competition in the power generation sector as well as provide a strong regulatory body while the latter will help restore confidence in the stock market.

The IMF said that the passage of revisions to the general banking act will also further strengthen the central bank's ability to supervise the banking system.

"Looking further ahead, it will be important to give bank supervisors the tools they possess in other well-regulated markets, including adequate protection from civil lawsuits for official actions taken and access to vital depositor information," the statement said.

The IMF said it is also vital to pursue the rehabilitation of the Philippine National Bank and to complete its privatization.