Salceda gives 81% rating to P-Noy's first year performance

LEGAZPI CITY (June 24, 2011) - A more than passing 81% mark - that's is what Albay Governor Joey Salceda gives to President Benigno Aquino III  assessing the president's first 11 months in office.

Salceda gave his verdict today during the 2nd full council meeting of the Bicol Regional Development Council (RDC) that he chairs.

Salceda's favorable opinion came a day after his former boss and economics professor, ex-president Gloria Macapagal-Arroyo, painted the spectre of economic disaster befalling the country under P-Noy's alleged weak leadership.

A noted economist himself, Salceda is politically allied with President Aquino being the top Liberal party leader in Bicol but his previous potshots at the former president were more humorous than confrontational.

Without highlighting that he was defending P-Noy from Gloria Arroyo's diatribes, Salceda cited at least 5 gains of the present administration that in his economist's mind would go a long way.

Increase in GIR

Salceda pointed out that from June 30, 2010 to May 31, 2011 Gross International Reserve (GIR) increased by $20 billion. As of May 2011 the GIR stood at $68.854 billion, a significant increase from $47.689 billion at the end of the Arroyo presidency.

The GIR is the sum of all foreign transaction flowing into the country. It is composed of reserve position in the International Monetary Fund, foreign exchange, gold reserves, special drawing rights (SDRs) and foreign investments. It is the main indicator of the country’s liquidity and ability to pay for the imports and service foreign obligations.

By convention, GIR is deemed adequate if it can pay for three months of imports and all foreign debts falling due within the year.

The current GIR can pay for more than 12 months of imports and 6.5 times the value of the country's short-term overseas indebtedness.

The concept may seem hollow to the ordinary man in the street. But the GIR can be made a gut-level concern if it is compared at micro level to a family's savings deposit in the bank that is readily available for regular expenses like food, clothing, tuition, electric bills, rent, indebtedness, etc. The more the amount the better family members feel and the more confident about their future.

Moody's and Fitch credit upgrades

He also cited the Moody’s credit upgrade, one notch below investment grade, the first in nine years. And just recently the Fitch Ratings upgraded the country’s credit rating to just below investment grade. These credit upgrades by prestigious and highly credible institutions boost the country’s international credit image as an investment destination, Salceda added.

Credit ratings are calculated from financial history and current assets and liabilities. Typically, a credit rating tells a lender or investor the probability of the subject being able to pay back a loan.

Moody's and Fitch are among the largest commercial credit rating agencies that operate worldwide.

Speedy fiscal consolidation through prudent spending

Salceda said that part of the gains made by the PNoy administration is the speedy fiscal consolidation through prudent spending that still resulted in growth of 4.9 percent.

4Ps

Contrary to criticisms from the president's opponents, Salceda also cited the P21 billion expanded Conditional Cash Transfer (CCT) program, popularly known as Pantawid Pamilyang Pilipino Program or 4Ps as a big achievement of the present administration.

It shall benefit some 2 million families and shall help to achieve Millennium Development Goals by 2015, he said.

The 4Ps is the government's program that attempts to make a dent on the huge problem of poverty in the country.

Jobs creation

Salceda also noted that some 1.4 million jobs have been created as of April 2011, pointing out that while 400,000 jobs were generated by the government sector, about 1 million jobs were created by the private sector. This according to the governor is an indication of a strong confidence by the business sector on a president who observes transparency in governance.

The governor concluded that the reforms now being put in place by President Aquino will see bountiful harvest by 2012. (From Ed de Leon, MAL/EDL, PIA V)