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Opinion

On the verge of an economic boom

BREAKTHROUGH - Elfren S. Cruz - The Philippine Star

The statement from the international credit rating agency, Standard & Poor’s, was that the Philippine credit rating had been increased to BBB. The best way to prove that the Philippines is no longer the “sick man of Asia” would be to compare our S&P credit rating with those of surrounding countries. Here is a comparative list of ratings of Asian countries: Malaysia, A-; Thailand,  BBB+;  Philippines,   BBB; India, BBB-; Indonesia, BBB-; Bangladesh,  BB-; Vietnam,  BB-; Sri Lanka, B+; Cambodia, B; Pakistan, B-.                            

It might also be a pleasant surprise for many Filipinos to discover which countries the Philippines is now at par, or rated higher, in terms of credit rating. Among the countries which have the same BBB credit rating as the Philippines are Bahrain, Colombia, Italy, and South Africa.

Among the countries with a credit rating of BBB- which is one grade lower than the Philippines are Azerbaijan, Brazil, Iceland, Russia, Spain, and Uruguay.

Among the countries that are more than one grade below the Philippines are Argentina (CCC+), Egypt (B-), Greece ( B-), Nigeria ( BB-), Portugal (BB), Turkey (BB+), and Hungary (BB).

Credit ratings are used by investors to help assess credit risk and to compare different potential investment areas when making investment decisions. Investment banks help facilitate the flow of capital from investors to issuers. They use credit ratings to determine whether they will advise potential investors whether a country is a good or bad investment destination.

Finance Secretary Cesar Purisima said: “This is further proof of President Aquino’s belief that good governance is good economics. We will continue to institutionalize good governance so our country’s economic growth is both sustainable and inclusive.”

But the most important statement, from Standard and Poor’s,  was a forecast for the Philippines: “The upgrade on the Philippines reflects a strengthening external profile, moderating inflation, and the government reliance on foreign currency debt. The outlook is stable and the ratings are not likely to change in the next 18 months.”

The agency also said “We expect ongoing reforms on a broad range of structural, administrative, institutional and governance issues to endure beyond the term of the current administration.” This is the most optimistic evaluation of the Philippine economy that I have ever read.

We can only hope that P-Noy will not allow political manuevering related to aspirations in the 2016 presidential elections to derail what could be one of his greatest legacies to the Filipino people – institutionalizing good governance and the beginning of an economic golden age for our country.

China Threatens Vietnam

Local headlines focus on the arrest of a Chinese crew that was caught poaching hundreds of sea turtles which are considered endangered species by environmentalists all over the world. According to the Philippine police, they found 354 sea turtles on the Chinese vessels, 234 of them dead. Sea turtles are globally protected sea reptiles.

But to the international media, this arrest of Chinese poachers was a mere sideshow because the major confrontation was what was happening between China and Vietnam. The initial report said that two Vietnamese vessels were rammed by a Chinese maritime vessel. But the geopolitical story was more serious and could lead to an escalation of tensions between the two countries.

The whole controversy centers around a Chinese oil rig called the HD-981. But this is no ordinary equipment. This is a 138-meter high platform capable of operating in 3,000 meters of water.

This is China’s first deep water rig and it will make it finally possible for China to pursue its goal of a more aggressive oil exploration and development undertaking close to mainland China.

The Vietnamese claim that there are now more than 50 Chinese vessels deployed in the area to protect the oil rig. Here are excerpts from a Vietnamese position paper:

“Up to now Vietnam has conducted 6 meetings at various levels with the Chinese side, both in Hanoi and Beijing to protest the operation of the HD-981 [oil rig]...

In these meetings and protesting communications, the Vietnamese side made clear that: (1) the location of HD-981 and its supporting vessels fall well within the 200 nautical miles EEZ of Vietnam, thus their activities cause severe violations of (i) sovereignity, sovereign rights and jurisdication of Vietnam as recognized by the UNCLOS, (ii) DOC-2002 and (iii) relevant agreement between the top leaders of Vietnam and China as well as the agreed fundamental principles guiding settlement of maritime issues between the two countries; (2) Vietnam demanded China to remove the HD-981 and supporting vessels out of Vietnamese waters; (3) Vietnam has sufficient legal grounds , historical evidence and actual exercise of jurisdiction over Paracels to claim its ownership; (4) Vietnam requested China to respect the sovereignty of Vietnam over Paracels, sovereign rights and jurisdiction of Vietnam; (5)Vietnam reiterated the proposal to settle the issue of Paracels sovereignty and other maritime disputes by negotiations and other peaceful means, including the UN Charter and UNCLOSD.

In response the Chinese side said the activities of HD-981 were normal petroleum activities of China in the southern part of Paracels, under China’s jurisdiction and there is no relation to EEZ/CS of Vietnam. China rejected the proposal of negotiations on Paracels sovereignty. Vietnam in turn rejected this position.

These actions of China negatively affect the political trust and the ongoing Vietnam-China maritime consultations and negotiations and the good relationships between the two people.”

These recent confrontations with Vietnam demonstrate that China intends to be more aggressive in pursuing territorial claims. Today they are in Philippine waters for sea turtles. Tomorrow it could be also be an oil rig. Will the EDCA serve as a deterrent? Or will we face the high and mighty China alone?

Come to the WRITE place

At a loss for words? Having difficulty turning those ideas into the written word? Then come to the WRITE place every Saturday starting May 24 and 31 at the Canadian American School at The City Club Alphaland Makati Place on Ayala Avenue cor Malugay St. The Young Writers’ Saturday Hangout hosted by the Where the Write Things Are Center offers individual, hands-on writing sessions specifically designed to cater to your child’s writing needs — whether for fiction, poetry, essays or any other writing style or genre.

No two sessions will be alike as we understand the unique gift for writing waiting to be unleashed within each student. The sessions are scheduled as follows: 10 – 11:30 a.m. (for 7-10 years old); 1 – 2:30 p.m. (for 11- 15 years old).

Lead facilitator is writer and book author Neni Sta. Romana Cruz.

For inquiries,call/text 0917-6240196 or email [email protected]

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Email: [email protected]

AYALA AVENUE

BBB

CHINA

CHINESE

COUNTRIES

CREDIT

PARACELS

PHILIPPINES

VIETNAM

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