Positive Economic Indicators to Further Boost Investor Confidence

MANILA, March 6

Philippines President Arroyo expects a further boost in investor confidence as a result of the country's much improved economic situation.

Aside from a bullish market and a stronger peso, the Philippine government reports a significantly lower budget deficit and increased revenue collection.

The Philippine Stock Exchange (PSE) Index closed higher today at 2,148.32 or 17.95 points better than last Friday's close at 2,130.37.

The Philippine peso continued to strengthen against the US dollar, hitting a new three-year high at P51.095 at midday today.

The budget deficit in January was down to P15.4 billion, which is P4.5 billion lower than the P20.9 billion forecasted for the month.

The lower budget deficit was brought about by higher revenue collection reported at P72.6 billion in January, and the P2.7 billion savings from government operations for the month.

In addition, President Arroyo pointed out that the Philippines credit ratings outlook and investor confidence would improve even further once the assessment of the Reformed Value Added Tax (RVAT) implementation is out.

Finance Secretary Margarito Teves said lower budget deficit and sound fiscal management would definitely boost investor confidence in the country.

The International Monetary Fund (IMF) sees stable Philippine growth, projecting the economy to grow at 5%. It also trimmed its inflation forecast down to 7.4% from its November prediction of 7.8%.

3/06/07

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