News Brief No. 98/40

News Brief: IMF Completes Review and Approves US$280 Million Credit Tranche for the Philippines

October 30, 1998

Shigemitsu Sugisaki, Deputy Managing Director of the International Monetary Fund (IMF), said today: " I am pleased to announce that in support of the government’s economic program, the IMF’s Executive Board today approved the completion of the first and second reviews under the stand-by credit¹ and the release of the first SDR 197 million (about US$280 million) credit tranche for the Philippines. The authorities have decided to draw under the standby credit, which thus far they had treated as precautionary. I commend the authorities for satisfactory progress in implementing the program under very adverse circumstances. The program supported by the credit has been modified at this review to take into account the continued difficult economic environment and to incorporate the policy agenda of the new government which took office in July 1998. The revised program for 1998/99 aims to deepen the stabilization gained so far, cushion the impact of the financial crisis on vulnerable sections of the population and set the stage for an early, strong and sustained recovery."

Sugisaki said the twin challenges facing the Philippines at this stage were to continue with effective stabilization policies while simultaneously providing the basis for the resumption of rapid growth over the medium-term. He emphasized the need for the government to proceed quickly and forcefully with the structural reform agenda with emphasis on banking, tax administration, trade liberalization, the corporate sector and public sector reform issues.