IMF chief: PHL creditor nation status ‘a big shift’

By OVP Media
November 16, 2012

MANILA  –  International Monetary Fund (IMF) Managing Director Christine Lagarde on Friday called the Philippines’ change in status from being a borrower to a creditor nation “a big shift.”

The IMF chief noted the role reversal during her courtesy call to Vice President Jejomar C. Binay at the Coconut Palace as she conveyed her gratitude for the country’s contributions to the World Bank as an IMF lender.

“To see your country come up with a contribution on World Bank loans at a time when the economic crisis is not here but in Europe in particular was real,” Lagarde told Binay.

“It was not so much the money, it was the signal that you gave,” she added.

Lagarde said it was now the European countries that have become the borrowers, with Ireland, Portugal and Greece being the IMF’s largest beneficiaries.

For his part, Binay expressed optimism that Europe “will get over the hump soon,” noting that the United Kingdom and France are the Philippines’ two largest trading partners in Europe.

In June, the Bangko Sentral ng Pilipinas (BSP) committed to provide $1 billion in loan resources under the bilateral borrowing facility of the IMF.

The continued growth of the country’s gross international reserves, fueled by the Overseas Filipino Workers’ (OFW) remittances allowed the BSP to extend loan resources to the IMF.

During their talks, the Vice President and the IMF chief also discussed the housing and real estate developments in the country.

“In my visit and tours, it seems that you have huge developments, massive real estate developments all over the place and then you have a big issue of developing housing for the poor,” Lagarde said.

"So you have two potential challenges here because too much real estate development can create a huge problem and you've got to care for the poor," she added.

Binay told Lagarde that the government’s housing program for the poor was now shifting from single detached units to medium rise buildings.