New DOF chief to focus on bridging budget gap

Trimming down the budget deficit through privatization of big ticket items will be one of the main thrusts of incoming Finance Secretary Jose Isidro "Lito" Camacho.

"Privatization will be a source of funding for the government as articulated by (Finance) Secretary Alberto Romulo including the block of Manila Electric Co. (Meralco) shares and anything else we can privatize," Camacho said, in an interview.

The government expects to generate P15 billion to P17 billion from its privatization efforts. If it will be able to sell 10 percent of Meralco shares this year, it will raise about P9 billion. Other assets up for privatization are: International Broadcasting Corp., International School in Makati, Al-Amanah Bank and Philippine National Construction Corp.

Camacho has been named by President Arroyo to replace Romulo, who will vacate his post to become the Executive Secretary. Camacho will take over the DOF post after Congress passes the new power bill. A special session will be called May 29 to 31 to ratify the power bill.

Sources said, with or without the power bill, Camacho will definitely take over the DOF post by mid-June.

Camacho said his short stint in the Department of Energy (DOE) has given him an overview of how important the power bill is particularly the privatization of the National Power Corp. (Napocor).

"The thrust of the government is really to be not where the private sector can be. That can be an interesting source of revenue," he said.

The energy chief said he intends to use all his investment banking skills to generate revenues for the country. "I think, we’ve done as much as we can to cut unnecessary expenditures. We really need to find ways and means to expand the revenue base," he said.

But he said he would try to continue what Romulo left unfinished. "I’m not in a position to comment other than my view that Secretary Romulo did a good job in containing the budget deficit. I have no reason to believe why his stated goals can’t be achieved," Camacho said, when asked if he believes the targeted P145-billion budget gap this year could be achieved or not.

Aside from the passage of the power bill, he said the foreign investors are looking at the political and other legislative developments before they start to consider the country as an alternative investment site again.

"They have had a wait-and-see attitude the past two months and I hope with the conclusion of our elections, their political view of the Philippines will be more settled. Clearly, what’s shaping up is the Senate and Congress. I think we will find support for legislative agenda of this Arroyo government," he said.

More importantly, he said there is a need to find a way to alleviate poverty. "If we intend to help the poor, we have to bring down our (electricity) rates. The other reason why we have to privatize the Napocor and restructure the industry because we need to start reallocating the financial resources of the government that has been going to the power sector," he said. – Donnabelle Gatdula