Tue, Jul 06, 2004 - Page 5 News List

Arroyo says Philippines is backward; pledges action

AP AND AFP , MANILA

President Gloria Macapagal Arroyo, admitting that her country lags behind most of Asia, said yesterday that her election victory gave her ammunition to "turn the Philippines around" with pro-poor reforms.

"I am mindful of the deep social injustice that has led to the great divisions in our country," Arroyo said in an op-ed article in The Asian Wall Street Journal.

She said huge disparities in income have created an "economic fault line that is like an earthquake waiting to happen."

"Millions of my people live in poverty and have a deep distrust of government. They are alienated from society and losing their sense of hope."

Arroyo announced a 10-point pro-poor agenda during her inauguration last week. It includes electricity and clean water in every village, low-cost medicine, loans for small businesses, up to 10 million new jobs and huge investment in infrastructure, education and technology.

"Once the shining star in Asia, the Philippines has struggled in recent years to regain its footing and join the rest of Asia as a genuine economic `tiger,'" she said. "We now have the political power to drive through the reforms needed to turn the Philippines around."

Critics have called her program unrealistic because she hasn't said how she would fund it.

But Arroyo insisted that her two-and-a-half years in power since taking over from ousted President Joseph Estrada in 2001 "have provided a window of opportunity to move on from the crisis work ... to focus on the structural reforms needed to take our economic development to the next level and create an environment for expanded domestic and foreign investment."

Topping the list of priorities is a ballooning budget deficit, which she said she will tackle by cracking down on tax cheats, increasing the tax base, expanding incentives for foreign investment and cutting red tape.

"Most notably, I will be the enforcer who sheds sunlight on the cozy relationships that have led to corruption in the Philippines. Sunshine is the best disinfectant in a democracy," Arroyo said.

She announced she has hired noted Peruvian economist Hernando de Soto as her policy adviser. De Soto has drafted an initiative ``to unleash the wealth of the poor through radically changing our system of property rights,'' Arroyo said.

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