Wednesday, December 9, 2009

Congressman Gloria seen as bad for business


Original Story:

President Arroyo’s run for a congressional seat and her declaration of martial law in Maguindanao could signal "more chaotic times ahead," a New York-based think tank said.

"We were still left a bit stunned when President Arroyo announced she was running for congresswoman in the next elections. This after all marked the first time a Philippine president would seek lower office and signaled possibly more chaotic times ahead for the country," GlobalSource said in its latest report on the country.

GlobalSource, one of the few global think tanks which run an office in Manila, said the President may target to clinch a key position in the next Congress and use her residual clout among her loyal congressmen and "be the proverbial thorn on the side of the administration."

"Such an environment, though not very likely, would be bad for business and the economy if efforts are spent on politicking rather than pushing key reforms," it said.

GlobalSource said a seat in the House, however, would not automatically save her from criminal suits after she steps down from the presidency in June 2010.

"It does not provide her the immunity she needs as the office can only shield her from charges of libel and minor offenses," it stressed.

The think tank also said the next President would likely hew to the long-held tradition that the Speaker "is historically handpicked by him from a newly formed majority coalition, making it difficult for (Arroyo) to move into the role next year if the winner is not an ally."

GlobalSource likewise belittled the influence of the remaining loyalists of the President in the House, saying the ruling party has not been able to engineer a change in the Constitution in the nine years she has been in power.

"And the chances are not about to brighten when she becomes only one of over 250 occupants of the House," it said.

GlobalSource said the declaration of martial law in Maguindanao targeting the Ampatuans also does not inspire confidence in the business sector and the global community.

"Many in the business sector dread the recent imposition of martial law in the South for its effect on investor sentiment, and beyond that, the possibility that it could be a dry run for nationwide martial rule leading to deep political turmoil," it said.

"Local and foreign businessmen worry that martial law would hurt not only the image of the Philippine South, which has been trying to shake off its reputation as a hotbed for dissidents, but also of the entire country, which certainly needs to capture more brick-and-mortar investments in order to grow robustly," GlobalSource said.

It said proclamation of martial law and suspension of the writ of habeas corpus in certain parts of the province has only served to heighten worries over possible trouble ahead for the rest of the country.

"Given the insecurity and uncertainty martial law is certain to bring, the sooner it is lifted in the country the better for the business environment and the economy," it said.

It further said a close monitoring of the twin events should be in order "as history has shown how martial law powers can be abused."

The tank also expressed worries over the government’s breaching of its full-year deficit goal of P250 billion after posting a funding shortfall of P226.1 billion in the first 10 months.

GlobalSource said with falling revenue collections and an unlikely privatization of big-ticket items with barely a month left in the year, the government should brace for at least a deficit of P300 billion or even closer to 4 percent of the gross domestic product (GDP) at P320 billion.

For next year, the deficit could be equivalent to 3.8 percent of the GDP or at least P310 billion from the original 2010 projected funding shortfall goal of P233.4 billion.

Finance Undersecretary Gil Beltran said the government is now looking at P320 billion as the worst-case deficit scenario for the year.

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