The IMF Loan Explained

(First of Two Parts)

Manila, Philippines – You may have heard of the Bangko Sentral’s pledge to extend a US$1 billion to the International Monetary Fund being discussed in television and radio talk shows, or read about politicians and economists state their views about it in the newspapers last month.

Many Filipinos, as exhibited by the media’s man-on-the-street interviews, have given many an impassioned opinion about it—understandable, since US$1 billion is indeed no measly amount.

However, the Bangko Sentral ng Pilipinas (BSP) has a justifiable reason for making this pledge. As BSP Governor Amando Tetangco, Jr. has explained: “The Philippines is supporting the global efforts to stabilize the world economy and maintain it on a growth path… we are a member of the global community of nations and it is also in our interest to ensure economic and financial stability across the globe.”

To further explain this topic to the ordinary Filipino, may I share this article written by one of our BSP employees, Jason P. Raval.
Jason, a photo journalist assigned at the BSP Corporate Affairs Office (CORAO), published this commentary in his Facebook account in an effort to explain to every “Juan and Maria” the reasons behind the BSP’s US$1 billion loan to the IMF.

Below is the first part of the article—a slightly edited version of the original. The second and last part will come out next week.

May I just say that this article is one of the best layman’s explanations I’ve read about the issue. Great job, Jason.

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$1 Billion
By Jason Arlan Pilaza Raval

$1 billion. TV, radio, print, and even social media is abuzz with the news that the Philippines has pledged to loan $1 billion to the IMF which will be used to help the Euro Zone countries in bad shape.

In many “man on the street” interviews from our local news programs, we would hear Juan and Maria complain that it is absurd to lend money to other countries when so many of our people our starving, schoolchildren are without classrooms, sick without proper healthcare, etc. They say the $1 billion or roughly P43 billion would do so much good if it was spent here for the Filipino people and not lent to other countries.

Juan and Maria’s sentiments are understandable, but the problem is, they do not understand where the $1 billion came from and what the loan will do for our country. So, for every Juan and Maria, here are some of the facts that you must know.

1. The IMF called out for pledges to fund its “Firewall” fund, which will be used to stave off future economic crises. Here’s the list of pledges that the IMF received arranged from highest to lowest. See where we are?
• Japan – $60 billion
• Germany – $54.7 billion
• China – $43 billion
• France – $41.4 billion
• Italy – $31 billion
• Spain – $19.6 billion
• Netherlands – $18 billion
• Britain – $15 billion
• Saudi Arabia – $15 billion
• South Korea – $15 billion
• Belgium – $13.2 billion
• Sweden – At least $10 billion
• Brazil – $10 billion
• India – $10 billion
• Mexico – $10 billion
• Russia – $10 billion
• Switzerland – $10 billion
• Norway – $9.3 billion
• Poland – $8.3 billion
• Austria – $8.1 billion
• Australia – $7 billion
• Denmark – $7 billion
• Turkey – $5 billion
• Finland – $5 billion
• Singapore – $4 billion
• Luxembourg – $2.7 billion
• Slovakia – $2.1 billion
• Czech Republic – $2 billion
• South Africa – $2 billion
• Colombia – $1.5 billion
• Slovenia $1.2 billion
• Malaysia – $1 billion
• New Zealand – $1 billion
• Thailand – $1 billion
• Philippines – $1 billion
• Cyprus – $600 million
• Malta – $300 million

To be continued next week.

Note: You may email us at totingbunye2000@gmail.com. Past articles may be viewed at
http://speakingout.ph/speakingout.php .

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