Treasurer quits Arroyo government

A woman gets all her savings back from a teller of the First Savings Bank in Manila, Philippines, while other depositors wait their turn yesterday. Operations of the the bank have been shut down since last week due to massive withdrawals, panicking more than 10,000 depositors trying to recover their savings. The shutdown occurred amid reports that the Philippines might face a fiscal crisis due to rising foreign debt. PHOTO: EPA

Philippine President Gloria Maca-pagal Arroyo accepted the national treasurer's resignation yesterday, but officials offered assurances that the move won't affect government efforts to bail the Philippines out of its financial doldrums.

Mina Figueroa, a key member of Arroyo's economic team, disclosed late Monday that she'd tendered her resignation, sparking fears that it could further unsettle a government already jittery over mounting financial problems.

Figueroa told ABS-CBN television that she wants to return to the private sector and denied reports she was quitting, effective Oct. 15, because of differences with other finance officials over the government's borrowing.

Arroyo's spokesman, Ignacio Bunye, said Arroyo has accepted Figueroa's resignation, and "the search is on for someone with equal integrity, intensive financial background and expertise and competence."

"The president acknowledges the personal reasons cited by Figueroa, and these should not be mixed up with policy issues that are handled institutionally by the Department of Finance," he added in a statement. In an apparent effort to ward off speculation about the resignation's possible dire effects, Finance Secretary Juanita Amatong told DZMM radio that the treasury "just implements whatever policy we make in the Department of Finance."

"The president acknowledges the personal reasons cited by [treasurer] Figueroa, and these should not be mixed up with policy issues that are handled institutionally."

Ignacio Bunye, presidential spokesperson

Figueroa, a private banker who became deputy treasurer in August 2001, first offered to resign in February but said other officials persuaded her to stay. She became national treasurer early this year.

News of the resignation came at a shaky time, as Arroyo grapples with burgeoning foreign debt, a gaping budget deficit and rising oil prices, which analysts say might lead to a financial meltdown similar to Argentina's in three years.

Argentina defaulted on its public debt in 2001 due to a huge deficit and staggering debt.

A government source told Dow Jones NewsWires that Figueroa decided to leave after being replaced as head of a treasury bond auction committee, where she often rejected bank demands for high interest rates on treasury bills and bonds to limit the government's financial obligations. Other officials had disagreed with her, the source said.

The stock market took the resignation as a catalyst for a technical correction, falling 2.3 percent after nine straight sessions of gains.

Some traders said the resignation could also hurt the peso currency and Philippine sovereign bonds, because it adds to uncertainty over the country's financial situation.