Former Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa Guinigundo today said a political party’s lack of clear platform of governance is troubling now that there is a clear scenario the next president will inherit the country’s outstanding debt of Php12 trillion accrued during the Duterte administration amid the COVID-19 pandemic.
Guinigundo cited the case of UniTeam of Ferdinand “Bongbong” Marcos that has yet to bare the plans in solving the government’s huge fiscal deficit, addressing the mounting debt of the country, and details of a fiscal consolidation plan that could inspire confidence in foreign and local businesses that the Philippine government will not go bankrupt.
According to data, the country’s debt ballooned to P12 trillion in 2021 from P7.7 trillion in 2019. In the latest forecast of the Nomura Global Research and their team of economists, the Marcos, Jr. and Sara Duterte tandem has earned low marks in the aspects of national experience, business friendliness, continuity/good governance, infrastructure progress and fiscal discipline.
JP Morgan also warned that the Philippines could face a twin deficit: fiscal deficit and current account deficit. According to experts, twin deficits could crash a country’s economy, especially in the wake of a global pandemic, rising interest rates, rise in fuel prices and unabated rise in cost and services.
“In the absence of clear programs, it will be very difficult to attract investors in the country—investors that could help create jobs and generate income for the local economy,” Gunigundo explained.
The former BSP governor said that presidency under Marcos could pave the way for a return of monopolies and cronyism. This could downgrade the country’s credit rating, that in turn could cause interest rates to soar as the Philippine peso weakens against the dollar in the global market.
“Let us all remember that in the martial law period, government financial institutions, most especially PNB, were milking cows of the Marcoses. We were mired in an unprecedented debt crisis that Filipinos, to this day, are paying through taxes,” Gunigundo elaborated. # # #