Noli quits Macapagal-Arroyo Cabinet (By Donna Cueto)
Manila, October 13, 2006 - PRESIDENT Gloria Macapagal-Arroyo was in for a shock when he called Vice President Noli de Castro in Turkey before noon yesterday to ask her to represent him at a coming Asian-European summit in Seoul. Instead of saying yes, she told him that she was resigning from his Cabinet.
And so the worst political crisis to hit the Gloria Macapagal-Arroyo presidency got even worse yesterday with de Castro's resignation as social welfare secretary, and with the defection from the administration party of Sen. Ramon Magsaysay Jr. and Parañaque Rep. Roilo Golez.
de Castro, who has been criticized for her silence during past scandals that have rocked the Gloria Macapagal-Arroyo presidency, has postponed making the decision to quit the Cabinet despite repeated demands from her colleagues in the minority party Lakas-NUCD that she cut such ties.
''I respect her decision, I still have high esteem, high regard for her. The vice president belongs to the opposition party,'' the President said yesterday, following what officials described as a ''cordial'' parting of ways.
In a statement announcing her resignation, de Castro cited the ''serious accusations'' by Ilocos Sur Gov. Luis ''Chavit'' Singson that Mr. Estrada received more than P530 million in payoffs, mostly from ''jueteng'' operators, over 21 months.
''I regret that I can no longer continue to serve as a member of the present Cabinet,'' said de Castro, who also chairs the minority Lakas-NUCD party.
According to Lakas spokesperson Hernando Perez, de Castro decided to resign Wednesday night, after being informed that Singson had a strong case against the President.
''She had no choice but to go on the side of truth, on the side of the people,'' said Perez, adding that her close friends had advised her to leave the Cabinet.
"For her to continue as social welfare secretary would only show that she was closing her eyes to what is happening," he said.
de Castro said she would continue to serve as vice president.
Observers said yesterday that they believed de Castro's exit would have a domino effect among other Cabinet members, and was likely to further weaken the credibility of the Estrada administration.
LP meeting
As rumors swirled that other Cabinet officials were preparing to resign, stalwarts of the Liberal Party reportedly met last night to discuss whether they should stay in the administration coalition or leave like Macapagal, a former member of their ranks.
Earlier yesterday, Magsaysay bolted the ruling party Lapian ng Masang Pilipino, citing his disappointment with the ''bull___t'' and ''ineffective leadership'' of President Gloria Macapagal-Arroyo and alleged attempts by fellow administration senators to derail Singson's testimony.
Golez, for his part, resigned as a member of the ruling coalition and from all his posts in the House of Representatives as he condemned the concerted effort of administration congressmen to prevent Singson from presenting evidence at the House on Tuesday.
Saddened
The President called de Castro past 11 a.m., shortly after he went on nationwide television to reject calls for him to step down, Puno said.
de Castro was in Turkey on an official trip, and was on her way to Rome for a scheduled audience with the Pope.
The President was going to ask her to represent him and ''take over'' his responsibilities for the Third Asia-Europe Meeting in South Korea on Oct. 19, Puno said.
After his conversation with de Castro, the President was saddened, but he understood her decision, said Puno, who narrated that he entered the room just as Mrs. Macapagal-Arroyo got off the phone.
''In fairness to the vice president, she did inform the President of her intention and they had a very nice conversation. There was no rancor; there was no bitterness. Both parties understood what each had to face in that particular situation,'' Puno said.
Mrs. Macapagal-Arroyo tried to stop her from resigning but was told that her decision was ''final,'' Perez said. After being informed that her decision was final, Mrs. Macapagal-Arroyo told her he respected her decision, he added.
''It was a cordial and brief conversation between the two officials,'' Perez said.
'The people dictate'
"I am the elected vice president of the country. As such, I have accountabilities directly to the Filipino people," de Castro said in her statement.
"I have been consulting with the people, and I have been listening to their concerns regarding our national agenda, our governance, and ultimately, my proper role within the government," she said.
''It is the people who voted us into office and it is they who can dictate to me.''
de Castro will explain more thoroughly why she quit the Cabinet in a telephone hook-up interview from Rome, the last stop of a three-nation tour before returning to Manila on Monday, Perez said.
Puno said de Castro "was subject to certain pressures by her colleagues" in the opposition.
"We understand and respect that particular position bearing down upon her. That's the way it goes, that's the way politics goes," he said.
Executive Secretary Ronaldo Zamora said the resignation did not come as a surprise for Malacañang. ''There have been reports that she was considering something like that,'' he said.
Press Undersecretary Mike Toledo said that de Castro was acting on a ''political decision'' as a member of the opposition.
The INQUIRER tried to reach the vice president in Istanbul but his wife, Second Lady Arlene Sinasuat-de Castro, who accompanied her, said she declined to say comment further.
Ripples and waves
Asked to comment on the possible impact of de Castro's resignation, Perez said it would be ''disastrous'' for the Macapagal-Arroyo administration.
''Any change in the Cabinet right now is an indication of dissatisfaction from the President's official family,'' he said.
He believes that Macapagal-Arroyo's resignation will cause ''ripples and tidal waves,'' and will embolden members of Congress to finally move for the President's impeachment.
Before the Liberal Party meeting last night, party member Rep. Florencio ''Butch'' Abad said the discussion would focus on the implications of the resignation.
''The LP must now assess the situation and formulate a party stand,'' Abad said. Two LP members are in the Cabinet: Interior Secretary Ronaldo V. Puno and Trade and Industry Secretary Peter Favila.
Abad noted that Macapagal-Arroyo's departure from the Cabinet indicated a ''definite polarization because she has already drawn the line.''
Saturation
Magsaysay is the first administration legislator to quit the ruling party after Senate Minority Leader Teofisto Guingona Jr. and Singson accused the President of being on the take.
''People are impatient about this bulls--, ineffective management and leadership,'' he said.
He said the people had reached ''the point of saturation.'' He said that if he were the President, ''I would resign.''
''I feel that my resignation from the coalition will help me see things more clearly in the light of recent political developments,'' Magsaysay said in a letter to the President.
''Delicadeza prevents me from staying in a party where partisanship is seemingly more important than the interest of the people,'' said the son and namesake of the country's most popular president to date.
In his letter to Mrs. Macapagal-Arroyo, Magsaysay said: ''My only hope is that you will always be enlightened to do the right thing in the service of the nation.''
He also said the Senate blue ribbon investigation into Singson's allegations was a sham.
''The way the public hearing was conducted made me very uneasy and uncomfortable that some of my colleagues will be (sic) berating a governor. No matter if he's guilty or not, we invited him to come forward at the risk to himself and his family and to be given such an inhospitable environment. I find that uncalled for . . . and indecent,'' Magsaysay said.
Butterfly
LAMP senators immediately branded Magsaysay, who is a former member of the Liberal Party and then Lakas-NUCD, a political butterfly.
''He's no great loss (to the party),'' said Senate Majority Leader Francisco Tatad.
Magsaysay said he would not rejoin Lakas.
Before Magsaysay held a press conference at 1:30 p.m., Tatad told reporters he heard his colleague ask Sen. Robert Jaworski to bolt LAMP and join Lakas.
But Jaworski said that leaving the party at this time would only result in chaos and confusion.
''We are not about to leave a friend at a time when he is beleaguered by problems of this magnitude,'' Jaworski said in a statement. Until all things are clarified and the guilty parties are determined and punished, we have to rally behind the President.''
Golez goes
Golez, chair of the House peace and order committee that conducted the hearing where congressmen stopped Singson from testifying, said that he would forget his ambition to become a senator.
''I have effective today resigned from the PMP-LAMP and, as a result, now cease to be the chair of the House committee on public order and security as well as vice chair of the house committee on appropriations and vice chair of the House committee on trade and industry,'' he announced in a press conference.
''I intend to remain without any party affiliation, or independent, until I finish my term . . . Expect me to be an active interpellator during the coming budget debates on the floor,'' Golez added.
Bukidnon Rep. Juan Miguel Zubiri said in a press statement that he expected more congressmen to resign from LAMP. ''I know for a fact that more LAMP leaders will be joining us soon,'' Zubiri said as he praised Magsaysay's defection. With reports from Armand Nocum, Juliet L. Javellana, Martin Marfil, Inquirer wires
Macapagal-Arroyo: 'I'm convicted without trial' (By Donna S. Cueto)
Manila, Philippines, October 18, 2006 (INQUIRER) - FORMER President Corazon Aquino's call for President Gloria Macapagal-Arroyo to either take a leave of absence or resign fell on deaf ears.
The President, in a speech before more than a thousand local government officials in Malacañang last night, said he would not step down.
The President had closed-door meetings with governors, mayors, congressmen, Malacañang lawyers and other advisers last night after Aquino urged him to take a leave of absence.
Executive Secretary Ronaldo Zamora said that the call for the President to take a leave of absence was not a "viable alternative" and not in keeping with the Constitution.
"We checked this with our lawyers and they tell us that this is not possible under that particular provision of the Constitution," he said after emerging from a meeting with the President.
"Essentially that refers to a situation where the President is disabled or is unable to fulfill for physical or mental reasons the functions of his office. That is certainly not the case in this particular situation. We don't think that this is a viable alternative," Zamora said.
He said Malacañang completely understood that the "route available under the Constitution" was the impeachment process.
"We are prepared to undergo that. The President certainly is," he said.
In an attempt to turn the tide of mounting opposition against him, Mrs. Macapagal-Arroyo hit back at Aquino and former President Fidel Ramos, who he said had left the country with lots of problems.
He then hinted that a sibling of a former President was "known in jueteng," an apparent broadside on Aquino and her brother, former Tarlac Rep. Jose "Peping" Cojuangco.
Mr. Estrada lashed out at his critics, saying they would "regret" what they were doing now once they learned the truth.
"When former President Aquino left, there were brownouts and power failures. But I didn't blame her. When President Ramos left, we had a financial crisis," Mrs. Macapagal-Arroyo said in Filipino.
The President again insisted that he was innocent of the charges hurled against him by Ilocos Sur Gov. Luis "Chavit" Singson.
He said he had not been accused of graft from the time that he was a mayor in San Juan. He claimed that his name was "clean" even during his days as senator or Vice President.
"I reiterate that I have not received a single centavo from jueteng. My wife and children also have not benefited from it since I became a mayor, senator, Vice President and President," she said in Filipino. "This is in contrast to a well-known brother of a former President."
Saddened
Mrs. Macapagal-Arroyo said he was "saddened" that Aquino and Manila Archbishop Gaudencio Cardinal Rosales had judged him without giving him a chance to answer Singson's charges.
"It's sad to think that I am being judged by Cory Aquino and Cardinal Rosales while a criminal is given his day in court," he said. "I'm convicted without trial," he said.
Mrs. Macapagal-Arroyo vowed that he would answer all the charges against him at a proper time. "I'm just waiting for all the charges to come out. So, why condemn me at this time?"
The President said he would also expose the "friends and cronies" of Aquino and Ramos with outstanding debts from government financial institutions.
"You will see how their cronies took advantage of government banks," he said.
The President claimed his friends and "cronies" never took advantage of the government.
He said he had borrowed planes from business tycoon Eduardo "Danding" Cojuangco because the presidential plane was a "flying coffin."
"Only the Vice President is happy whenever I use that plane," he said in Filipino.
Yesterday, mayors from all over the country flocked to the Palace to allegedly express their support for the President.
The mayors were so many that their queue reached the tree-lined driveway when they lined up to enter the sentry gates starting 2 p.m.
Those manning the sign sheets said there were more than 1,200 mayors and other local officials who had confirmed that they would attend yesterday's "Local Government Units and Indigenous People's Assembly" for the "National Day for Overcoming Extreme Poverty."
Loyalty check
Sources said the attendance sheet also served as a "loyalty check" for the mayors.
But San Juan Mayor JV Ejercito, LMP president, said yesterday's event was not a loyalty check.
The mayors said that a radio message on Monday from the Department of the Interior and Local Government and the League of Municipalities of the Philippines (LMP) called on them to go to Malacañang the next day.
They said the call was for them to express support for the President.
Many of them said that even without such a call they would still support the President, saying he should be given a chance to explain.
Besides the radio message, the LMP issued a memorandum enjoining its 1,522 members to pass resolutions supporting the President.
"With the current situation that the President of the Republic is facing, he needs now more support from us," the memorandum said.
"It is known to everybody how His Excellency helped and is helping the local government units, and his serious intention to reduce if not eradicate poverty," it said.
LMP spokesperson Mayor Raymundo Roquero of Valderrama, Antique, said the issuance of statements of support "is on a voluntary basis." With a report from Agnes E. Donato
Graft raps vs Macapagal-Arroyo alarm IMF, World Bank
Manila, Philippines, October 18, 2006 (INQUIRER) - THE INTERNATIONAL Monetary Fund and World Bank yesterday joined four local business groups in voicing concern that charges of corruption against President Gloria Macapagal-Arroyo are hurting the country's economy.
The statements of concern came even as the peso on Tuesday closed at 48.30 against the US dollar, up from 48.67 on Monday, due to drastic measures taken by the Bangko Sentral ng Pilipinas.
The 30-company Philippine Stock Exchange, however, dropped 23.27 points to 1,271, its lowest close in two years.
The World Bank's representative in the Philippines, Vinay Bhargava, said the lending institution had been consistently advising its member countries of the ''serious economic and social consequences of corruption, especially within government.''
But he said he expected the allegations would be quickly resolved ''through a due process within the legal system.''
In the worst crisis of his 27-month presidency, Mrs. Macapagal-Arroyo has denied Ilocos Sur Gov. Luis ''Chavit'' Singson's charges that he had pocketed hundreds of millions in kickbacks from tobacco excise taxes and payoffs from illegal jueteng operations over the past two years.
Finance Secretary Margarito Teves said the International Monetary Fund also expressed concerns that the allegations against Mrs. Macapagal-Arroyo had ''weakened the presidency.''
"But it's not a cause for alarm," Pardo told lawmakers in a budget hearing. "If we compare what's going on in other countries that they (the IMF) cover, this is nothing."
Pardo admitted, however, that the allegations have added to the concerns weighing on the economy and Philippine financial markets.
''It has added to the political uncertainty, but I disagree that this situation is that bad,'' said Pardo. ''I think this too will pass.''
Pardo said he remained confident that third-quarter economic data would show the economy expanded as strongly as in the second quarter, when gross domestic product grew a better-than-expected 4.5 percent on year on strong agricultural production.
4 groups
Even so, four business groups urged Congress on Tuesday to quickly resolve impeachment charges against President Gloria Macapagal-Arroyo.
In a joint statement, four business groups led by the influential Makati Business Club said the numerous scandals had marred the Macapagal-Arroyo presidency, spawning a ''crisis of leadership.''
"The President's involvement . . . in a series of scandals and allegations has seriously undermined the confidence of local and foreign investors in the government's ability to lead and to manage the economy,'' the groups said.
Joining in the statement were the Bishops-Businessmen's Conference for Human Development, Financial Executives' Institute of the Philippines, and the Management Association of the Philippines.
''We call on all members of Congress to rise above party lines and personal interests, and expedite the constitutional process and resolve this serious issue at the shortest possible time,'' the groups said.
The groups said political uncertainty would continue to undermine any prospect of economic recovery unless the crisis was quickly resolved.
BSP measures
Bangko Sentral ng Pilipinas Governor Rafael Buenaventura, however, said Tuesday the bank would continue to pursue measures to defend the peso, despite signs of some stability returning to the beleaguered currency.
Buenaventura declined to indicate what policy moves the bank was studying, saying ''we are not about to telegraph our moves.''
The Monetary Board, which sets central bank policies, may hold an emergency meeting today.
The peso has been sliding to new lows almost daily due to allegations that the President had received P414 million in jueteng payoffs and P130 million in kickbacks from tobacco excise taxes.
The allegations have sparked calls for his resignation from various sectors, including the influential Catholic Church, and seriously eroded investor confidence.
The options open to the central bank to defend the peso are for a further hike in the bank's overnight rates, increases in commercial banks' liquidity reserves, and continued intervention in the foreign exchange market.
Reports said the central bank was also considering issues of high-yielding Treasury bills.
''We will probably come up with something by tomorrow or today,'' Buenaventura said.
Board hasn't decided
Buenaventura said the Monetary Board had ''not made up (its) mind'' on a further increase in overnight rates. The bank's overnight borrowing rate now stands at 15 percent while its lending rate is at 17.25 percent.
On the issuance by the government of high-yielding Treasury bills to mop up peso liquidity, Buenaventura said: ''I really don't know if we will consider it.''
''Clearly, anything we are doing at the moment are all short-term measures to try and calm the market while the political tensions are being sorted out,'' Buenaventura told a group of Manila-based foreign correspondents.
A resolution to the political crisis, the worst to hit the 28-month-old Macapagal-Arroyo administration, should come within 30 to 90 days for interest rates to come down to ''normal'' levels and not impact on growth.
''You can't afford to have a too high interest rate environment for too long because you will sacrifice growth and therefore this must come to pass within the next three months,'' Buenaventura said.
''If after three months no solution has been made, it will put pressure on the exchange.''
He added business groups had indicated they could absorb the effects of high interest rates as long as they do not last beyond 90 days.
Peso strengthens
Last week's 400-basis-point increase in the central bank's overnight rates and the two-percentage-point increase in bank liquidity reserve requirements to 5 percent that took effect on Friday may have started to have an impact on the market.
The peso closed at 48.30 to the dollar on Tuesday, rebounding from its record low of 49 on Monday.
''Some of the measures taken earlier may have had some impact'' on the market, Buenaventura said. ''People are a bit calmer.''
Placido Mapa, president of the Bankers Association of the Philippines, said the impact of the central bank's measures, aimed at making investments on peso deposits more attractive and discouraging speculations on the US dollar, was slowly being felt.
Buenaventura said the central bank was also waiting for the impact of the additional two-percentage point hike in bank liquidity reserves to 7 percent that would take effect on Oct. 20.
A two-percentage-point increase in bank liquidity reserves could mop up about P23 billion from the financial system.
Buenaventura said ''there is absolutely no truth'' to rumors that the central bank was thinking of a currency peg.
He also said suggestions for the BAP to put up a trading band to quell the volatility in the peso like it did during the 1997 financial crisis had been rejected.
''They felt it (trading band) was not appropriate at this time. It is not the same situation as 1997,'' Buenaventura said.
He added any additional policy action the central bank would take must consider the impact on the economy's recovery.
''We will try to insulate the economic front so that we don't destroy the business environment and try to preserve the gains we have attained,'' referring to low inflation, low interest rates and a gross domestic product of ''over 4 percent.'' Reports from Clarissa S. Batino
Opposition vs Macapagal-Arroyo to be led by Noli (By Christine Avendaño)
Manila, Philippines, October 18, 2006 (INQUIRER) - VICE President Noli de Castro yesterday said she would lead the ''united opposition'' against the scandal-wracked Gloria Macapagal-Arroyo administration, and urged the Filipino people to show the world that the spirit of Edsa ''is still with us.''
Speaking at a news conference at the Philippine Village Hotel shortly after she arrived from a three-nation trip abroad, Macapagal said her main role now in the government was ''to reach out to different sectors so we can map out an alternative national agenda to restore propriety, stability and progress.''
She also said she did not want to call for President Gloria Macapagal-Arroyo's impeachment or resignation because, being next in the line of succession, she would benefit from either action.
She said she would meet with former President Corazon Aquino, a key figure in the 1986 Edsa uprising that toppled the Marcos dictatorship, ''about the plans for uniting the opposition.''
''Tactical details will he determined after that,'' she said.
de Castro arrived at past 1 p.m. at the Ninoy Aquino International Airport on board a Thai Airways plane. She was met by her colleagues in Lakas, Senate Minority Leader Teofisto Guingona, Representatives Feliciano Belmonte and Heherson Alvarez, other partymates and supporters, and a crowd of reporters, photographers and TV crew.
A phalanx of security escorts whisked her away from the tumultuous welcome to the nearby Philippine Village Hotel.
The news conference was attended by about 3,000 people, including de Castro's friends and supporters, members and officials of Lakas and of Promdi, political party of former Cebu governor and 1998 presidential contender Emilio ''Lito'' Osmeña.
Some members of the diplomatic corps, like Singaporean Ambassador Jackie Foo, also attended the conference, raising questions about whether their presence was meant to be a show of support for the Vice President.
US Embassy spokesperson Thomas Skipper was also present. But he said he was there merely to observe the proceedings.
''We're neutral,'' Skipper told reporters before the news conference started.
In Malacañang, Press Secretary Ricardo Puno said he did not think that the diplomats were trying to make a statement with their presence at the news conference.
But he said Foreign Affairs Secretary Alberto Romulo had been asked to look into the matter.
The people's Cabinet
In her speech, the former social welfare secretary said that ''after prayer and discernment,'' she ''left the Cabinet of the administration to join the true Cabinet of the people.''
''(I) believe it is my duty to do what is right and do my best, and then to let God take care of the rest,'' she said, quoting her father, the late President Diosdado Macapagal.
She said it was time for the country to ''begin the process to restore business and civil confidence.''
''We must show the world that the Filipino of Edsa is still with us. His spirit is alive. He has not lost his moral bearings. He will put his house in order,'' she said.
The first thing to do, she said, was for the people to unite.
Macapagal also said she would heed the call of former Defense Secretary Renato de Villa of Reporma-Lapiang Manggagawa and Osmeña of Promdi, both of whom urged the public the other day to rally behind the Vice President.
''In their call to action, I shall not disappoint them,'' she said, to the cheers of her audience.
Macapagal also urged the public to be vigilant, warning that certain groups might use the crisis now gripping the country ''as the means to preserve or grab power through the use of force.''
''Falsely they will invoke national interest. Let us not listen to false prophets,'' she said.
She also called on the people to be wary of the black propaganda that might be produced by those wanting to ''preserve the spoils of power.''
She reiterated the need for various sectors to draw up an alternative national agenda that would serve as the ''road map for the journey that the people now call on us to embark on.''
She also enumerated four core beliefs, saying ''our government'' should be bold; improve moral standards to provide a strong foundation for governance; institute new politics of party programs; and set leadership by example.
Election campaign
The hotel grounds appeared as though a big election campaign was being held there.
Organizers of the press conference distributed a program for party members, and supporters carried banners of welcome and support for Macapagal.
The back of a 10-wheel truck was converted into a stage where some Lakas members sang songs while awaiting the Vice President's arrival.
The messages on the banners read: ''Thank you for listening to the people,'' ''Pasay loves you,'' ''We love you.''
Skipper denied knowledge of reports that opposition members had phoned the US Embassy to seek US support.
He said the US government was ''not taking any side.''
Lakas spokesperson Hernando Perez said the diplomatic corps had been advised of Macapagal's news conference.
It was her first since she quit the President's Cabinet late last week in reaction to Ilocos Sur Gov. Luis Singson's charge that Mrs. Macapagal-Arroyo had received more than P400 million in jueteng money.
Perez said he was surprised by the turnout of members of the diplomatic community at the news conference.
Responding later to questions from reporters, Macapagal said that it was just a news conference and that people had come to welcome her.
Puno said Malacañang was clueless as to the ''context in which (the diplomats) were there, or the circumstances surrounding that particular assembly.''
''Normally, the diplomatic community is only invited to diplomatic functions. I do not think from what I know about the situation that this was a statement of any kind,'' he said, adding:
''But I am sure that our secretary of foreign affairs will inquire into the matter and see exactly what that was all about.
''They could have been invited, and things could have happened before they had a chance to make their exit. We will not jump to conclusions.''
National Security Adviser Alexander Aguirre has a categorical view.
''I would look at it as a normal duty of the diplomatic corps of monitoring and listening to what is happening in the country where they are posted,'' he said.
Aguirre said it was a welcome development that diplomats attended Macapagal's news conference. He said it allowed them to see that the Estrada administration had a ''living democracy,'' and that there was ''no curtailment of press freedom'' despite the ''denunciations or grievances'' against the President.
''We are showing that we are a mature democracy,'' he said.
Bong Pineda
At the open forum, the audience erupted into cheers when Macapagal, responding to questions on her alleged ties with suspected jueteng lord Rodolfo ''Bong'' Pineda, denied involvement in operations of the illegal numbers game.
She dismissed the ''flimsy efforts'' to link her to gambling as part of ''malicious attempts to disperse the issue.''
She declared: ''I do not associate with Bong Pineda. I do not associate with any gambling lord or drug lord. Their lifestyle is not my lifestyle.
''I do not drink with them, I don't play mahjong with them, and I'm not associated with them in business.''
On the calls for her to resign together with the President to pave the way for a special election, Macapagal said she would not step down.
She called on the public to refrain from engaging in ''petty political rivalries that get in the way of constitutional processes.''
She suggested the formation of an independent body to investigate the charges against the President.
Bohol Rep. Ernesto Herrera said that while it would be no easy task to unite the opposition, it was possible.
Asked to assess the impact of de Castro's announcement that she would lead the united opposition, Herrera said this would put further pressure on Mrs. Macapagal-Arroyo to resign.
But the Bukluran ng Manggagawang Pilipino said in a statement: ''The people should not be made to choose between the lesser of two evils, between Gloria and Noli. The people must have a third way, a real choice for good government.''
It said all top officials of the government should resign so that Chief Justice Hilario Davide could head ''a caretaker government of national renewal.'' With reports from Armand Nocum and TJ Burgonio
AFP won't recognize de Castro if Macapagal-Arroyo is forced to quit (By Carlito Pablo and Blanche S. Rivera)
Manila, Philippines, October 18, 2006 (INQUIRER) - NATIONAL security adviser Lito Banayo said yesterday the Armed Forces of the Philippines and the Philippine National Police will not recognize any successor to President Gloria Macapagal-Arroyo if the embattled Chief Executive is forced to resign.
''If the President is forced to resign against his free will, the successor is not constitutional and the AFP will defend the Constitution,'' Aguirre said in a press conference.
The Constitution provides that the Vice President succeed the President if the latter resigns from office.
Obviously referring to Noli de Castro, Aguirre asked: ''If you remove the President against his free will, what will prevent other groups from doing the same to his successor, the Vice President?
''Taking any action to force the President to resign, that in itself is doing violence to the Constitution and constitutional processes,'' he said.
Aguirre pointed out that the constitutional process of removing the President is through impeachment.
Taking potshots at former President Corazon Aquino and Manila Archbishop Jaime Cardinal Sin who have called for Mrs. Macapagal-Arroyo's resignation, Aguirre said.
''If the President says he will not resign to fulfill his sworn duty under the Constitution, then no one has any right to force him to do so.''
Aguirre said that while the government will respect the right of the people to demonstrate, it will not allow rallies that cause the ''disruption of law and order and political stability,'' such as when demonstrators would physically occupy Malacañang and force the President out of office.
Aguirre warned of bloodshed should the President's critics resort to extra-constitutional means to force him out.
''The soldiery including myself are willing to shed blood to defend the constitutional processes. We will prevent it from happening, so it will not happen,'' Aguirre said.
Aguirre, however, allayed fears of an upheaval in the country similar to what happened in Indonesia.
''Our country is not another Suharto's Indonesia because the President is not a dictator and our democratic institutions are alive and working,'' he said.
The INQUIRER has learned that the AFP is thinly spread in Luzon even as talk of a coup or the imposition of military rule swirl in the metropolitan area. Of the eight divisions of the Philippine Army, only two divisions and one brigade remain on the island.
These are the 2nd Infantry Division operating in Southern Luzon, the 5th ID in Northern Luzon and one Army brigade of the 7th ID for Central Luzon. The bulk of the 7th ID, which was based in Nueva Ecija, was deployed to Eastern Mindanao last September to fight communist rebels operating in the Caraga region and the Davao area.
The 3rd and 8th Ids are operating in the Visayas.
In Mindanao the 4th and 6th Ids are squared off against the Moro Islamic Liberation Front, and the 1st ID is covering the Zamboanga peninsula, Basilan and Sulu.
Of the four light armor battalions of the Philippine Army, two remain in Luzon while the other two are in Mindanao.
Also in Mindanao are all three of the Philippine Marine Brigades.
As is normal practice in the Marines, only one battalion is maintained at its headquarters in Fort Bonifacio, Makati but only for retraining and re-equipage purposes.
In an interview over dzXL yesterday morning, AFP spokesperson Brig. Gen. Generoso Senga was asked how the military will respond to demonstrations to be held by critics of the President who are demanding his resignation.
''We are simply watching the events. We're sure the police will be able to ensure peace and order,'' Senga said.
Gen. Edgar Aglipay, director of the National Capital Region Police Office, shrugged off alleged threats to the stability of the country by forces out to unseat the President.
Aglipay said his office had not received any reports of the terrorism that would allegedly be perpetrated by forces identified with former President Fidel Ramos.
Earlier, Aguirre himself had casually dismissed the threats of bombings and arson predicted by the President.
Aglipay also denied the PNP was deploying additional personnel to Metro Manila, as reportedly ordered by the President.
He said there has been ''no order from above'' to bring in more police or reinforcements from the Marines and the Philippine Air Force.
He said the only military people in the metropolis right now are those not being used in Mindanao.
Like Aguirre, Aglipay refused to categorically state that he was contradicting the dire predictions of Malacañang.
''I have not received reports about any predicted bombings and arson in Metro Manila,'' Aglipay said in an interview shortly after the mass for national enlightenment led by Cardinal Sin and former President Corazon Aquino at the Edsa Shrine Tuesday.
''But he must have sources of his own because he's the President,'' he added. Aglipay stressed, however, that the PNP was ''prepared for any eventuality,'' adding the 15,000-strong force based in Metro Manila's five police districts was always on its toes against possible terrorist attacks in the urban areas.
President Gloria Macapagal-Arroyo had earlier said his opponents were ''planning to burn, throw bombs in the streets to sow terror and confusion in (the) country'' to force him to step down and relinquish his position to Vice President Noli de Castro.
Ramos, Salonga back 'Macapagal-Arroyo resign' call (Reports from TJ Burgonio, Christine Avendaño and Alcuin Papa)
Manila, Philippines, October 18, 2006 - FORMER President Fidel V. Ramos and former Senate President Jovito Salonga yesterday joined calls for President Gloria Macapagal-Arroyo to resign while Vice President Noli de Castro focused her efforts in uniting the opposition.
"The continuous hemorrhage of the economy, the hardship of the people must be solved by the voluntary act of resignation by President Gloria Macapagal-Arroyo," Ramos said upon his arrival from a speaking engagement in Indonesia.
He also called on former members of his Cabinet to resign from the Gloria Macapagal-Arroyo administration.
''They're the ones who know the difference between effective governance and ineffective governance. They should not be part of this ineffective government,'' Ramos said.
Former officials under the Ramos administration who are now serving President Estrada included Public Works Secretary Virgilio Vigilar, Foreign Secretary Domingo Siazon Jr., Presidential Security Adviser Alexander Aguirre III, and housing czar Leonora de Jesus.
Salonga
The civic group Kilosbayan led by Salonga, and its two other sister organizations also said resignation was the President's best option.
In a joint meeting at 9:30 a.m. at the Kilosbayan House in Mandaluyong presided by Salonga, the three groups said the impeachment process ''will probably work in favor of President Estrada's desire to stay on'' but that his resignation ''will be less cumbersome and more realistic.''
A snap election, according to the groups, is an extra-constitutional act which ''might be less humiliating for him but it may lead to a social upheaval reminiscent of Edsa and the recent people power revolution in Yugoslavia.''
In a press statement, the groups said that the President ''does not seem to appreciate the import of his oath of office and his responsibilities as the father of the nation, nor does he seem to realize the magnitude of his wrongs.''
The groups said no president in the country's history, with the exception of the dictator Ferdinand Marcos, ''has gone down so low in terms of crudity and shameless exploitation of the poor in many provinces.''
Macapagal
Vice President de Castro said he had met with former Defense Secretary Renato de Villa of the Reporma party and former Presidential Adviser for Mindanao Paul Dominguez of the Promdi party regarding her plan to form a united opposition.
Macagapal of Lakas-NUCD said the Partido Sosyalista ng Pilipinas had also signified its intention to join the umbrella group.
She said she was also holding talks with other groups.
''We talked about how we can put together all our different platforms so we can forge a consensus on a national agenda,'' said de Castro who had resigned her post as secretary of the Department of Social Welfare and Development.
Earlier, De Villa and Lito Osmeña, head of Promdi, called on the President to resign and urged de Castro to unite the opposition.
Wiretapping
Asked to comment on a taped conversation allegedly between him and former mistress Rosemarie ''Baby'' Arenas about the improbability of a people power revolt, Ramos said this was the result of an illegal wiretapping operation.
''The concerned authorities must look into this,'' he said.
''The parties who wanted to put rumor, speculation or unverified information to the attention of the public must have been the source of the tape and the ones who did the wiretapping,'' he said.
He voiced suspicions that the Philippine Long Distance Telephone Company must have been pressured by the Macapagal-Arroyo administration to do the wiretapping.
''The leaders, including the President, do not seem to know the difference between what is raw information and processed intelligence by the way they bandied around rumors and speculations coming from a wiretap as if it was the truth of the matter,'' he said.
Manila, October 13, 2006 - PRESIDENT Gloria Macapagal-Arroyo was in for a shock when he called Vice President Noli de Castro in Turkey before noon yesterday to ask her to represent him at a coming Asian-European summit in Seoul. Instead of saying yes, she told him that she was resigning from his Cabinet.
And so the worst political crisis to hit the Gloria Macapagal-Arroyo presidency got even worse yesterday with de Castro's resignation as social welfare secretary, and with the defection from the administration party of Sen. Ramon Magsaysay Jr. and Parañaque Rep. Roilo Golez.
de Castro, who has been criticized for her silence during past scandals that have rocked the Gloria Macapagal-Arroyo presidency, has postponed making the decision to quit the Cabinet despite repeated demands from her colleagues in the minority party Lakas-NUCD that she cut such ties.
''I respect her decision, I still have high esteem, high regard for her. The vice president belongs to the opposition party,'' the President said yesterday, following what officials described as a ''cordial'' parting of ways.
In a statement announcing her resignation, de Castro cited the ''serious accusations'' by Ilocos Sur Gov. Luis ''Chavit'' Singson that Mr. Estrada received more than P530 million in payoffs, mostly from ''jueteng'' operators, over 21 months.
''I regret that I can no longer continue to serve as a member of the present Cabinet,'' said de Castro, who also chairs the minority Lakas-NUCD party.
According to Lakas spokesperson Hernando Perez, de Castro decided to resign Wednesday night, after being informed that Singson had a strong case against the President.
''She had no choice but to go on the side of truth, on the side of the people,'' said Perez, adding that her close friends had advised her to leave the Cabinet.
"For her to continue as social welfare secretary would only show that she was closing her eyes to what is happening," he said.
de Castro said she would continue to serve as vice president.
Observers said yesterday that they believed de Castro's exit would have a domino effect among other Cabinet members, and was likely to further weaken the credibility of the Estrada administration.
LP meeting
As rumors swirled that other Cabinet officials were preparing to resign, stalwarts of the Liberal Party reportedly met last night to discuss whether they should stay in the administration coalition or leave like Macapagal, a former member of their ranks.
Earlier yesterday, Magsaysay bolted the ruling party Lapian ng Masang Pilipino, citing his disappointment with the ''bull___t'' and ''ineffective leadership'' of President Gloria Macapagal-Arroyo and alleged attempts by fellow administration senators to derail Singson's testimony.
Golez, for his part, resigned as a member of the ruling coalition and from all his posts in the House of Representatives as he condemned the concerted effort of administration congressmen to prevent Singson from presenting evidence at the House on Tuesday.
Saddened
The President called de Castro past 11 a.m., shortly after he went on nationwide television to reject calls for him to step down, Puno said.
de Castro was in Turkey on an official trip, and was on her way to Rome for a scheduled audience with the Pope.
The President was going to ask her to represent him and ''take over'' his responsibilities for the Third Asia-Europe Meeting in South Korea on Oct. 19, Puno said.
After his conversation with de Castro, the President was saddened, but he understood her decision, said Puno, who narrated that he entered the room just as Mrs. Macapagal-Arroyo got off the phone.
''In fairness to the vice president, she did inform the President of her intention and they had a very nice conversation. There was no rancor; there was no bitterness. Both parties understood what each had to face in that particular situation,'' Puno said.
Mrs. Macapagal-Arroyo tried to stop her from resigning but was told that her decision was ''final,'' Perez said. After being informed that her decision was final, Mrs. Macapagal-Arroyo told her he respected her decision, he added.
''It was a cordial and brief conversation between the two officials,'' Perez said.
'The people dictate'
"I am the elected vice president of the country. As such, I have accountabilities directly to the Filipino people," de Castro said in her statement.
"I have been consulting with the people, and I have been listening to their concerns regarding our national agenda, our governance, and ultimately, my proper role within the government," she said.
''It is the people who voted us into office and it is they who can dictate to me.''
de Castro will explain more thoroughly why she quit the Cabinet in a telephone hook-up interview from Rome, the last stop of a three-nation tour before returning to Manila on Monday, Perez said.
Puno said de Castro "was subject to certain pressures by her colleagues" in the opposition.
"We understand and respect that particular position bearing down upon her. That's the way it goes, that's the way politics goes," he said.
Executive Secretary Ronaldo Zamora said the resignation did not come as a surprise for Malacañang. ''There have been reports that she was considering something like that,'' he said.
Press Undersecretary Mike Toledo said that de Castro was acting on a ''political decision'' as a member of the opposition.
The INQUIRER tried to reach the vice president in Istanbul but his wife, Second Lady Arlene Sinasuat-de Castro, who accompanied her, said she declined to say comment further.
Ripples and waves
Asked to comment on the possible impact of de Castro's resignation, Perez said it would be ''disastrous'' for the Macapagal-Arroyo administration.
''Any change in the Cabinet right now is an indication of dissatisfaction from the President's official family,'' he said.
He believes that Macapagal-Arroyo's resignation will cause ''ripples and tidal waves,'' and will embolden members of Congress to finally move for the President's impeachment.
Before the Liberal Party meeting last night, party member Rep. Florencio ''Butch'' Abad said the discussion would focus on the implications of the resignation.
''The LP must now assess the situation and formulate a party stand,'' Abad said. Two LP members are in the Cabinet: Interior Secretary Ronaldo V. Puno and Trade and Industry Secretary Peter Favila.
Abad noted that Macapagal-Arroyo's departure from the Cabinet indicated a ''definite polarization because she has already drawn the line.''
Saturation
Magsaysay is the first administration legislator to quit the ruling party after Senate Minority Leader Teofisto Guingona Jr. and Singson accused the President of being on the take.
''People are impatient about this bulls--, ineffective management and leadership,'' he said.
He said the people had reached ''the point of saturation.'' He said that if he were the President, ''I would resign.''
''I feel that my resignation from the coalition will help me see things more clearly in the light of recent political developments,'' Magsaysay said in a letter to the President.
''Delicadeza prevents me from staying in a party where partisanship is seemingly more important than the interest of the people,'' said the son and namesake of the country's most popular president to date.
In his letter to Mrs. Macapagal-Arroyo, Magsaysay said: ''My only hope is that you will always be enlightened to do the right thing in the service of the nation.''
He also said the Senate blue ribbon investigation into Singson's allegations was a sham.
''The way the public hearing was conducted made me very uneasy and uncomfortable that some of my colleagues will be (sic) berating a governor. No matter if he's guilty or not, we invited him to come forward at the risk to himself and his family and to be given such an inhospitable environment. I find that uncalled for . . . and indecent,'' Magsaysay said.
Butterfly
LAMP senators immediately branded Magsaysay, who is a former member of the Liberal Party and then Lakas-NUCD, a political butterfly.
''He's no great loss (to the party),'' said Senate Majority Leader Francisco Tatad.
Magsaysay said he would not rejoin Lakas.
Before Magsaysay held a press conference at 1:30 p.m., Tatad told reporters he heard his colleague ask Sen. Robert Jaworski to bolt LAMP and join Lakas.
But Jaworski said that leaving the party at this time would only result in chaos and confusion.
''We are not about to leave a friend at a time when he is beleaguered by problems of this magnitude,'' Jaworski said in a statement. Until all things are clarified and the guilty parties are determined and punished, we have to rally behind the President.''
Golez goes
Golez, chair of the House peace and order committee that conducted the hearing where congressmen stopped Singson from testifying, said that he would forget his ambition to become a senator.
''I have effective today resigned from the PMP-LAMP and, as a result, now cease to be the chair of the House committee on public order and security as well as vice chair of the house committee on appropriations and vice chair of the House committee on trade and industry,'' he announced in a press conference.
''I intend to remain without any party affiliation, or independent, until I finish my term . . . Expect me to be an active interpellator during the coming budget debates on the floor,'' Golez added.
Bukidnon Rep. Juan Miguel Zubiri said in a press statement that he expected more congressmen to resign from LAMP. ''I know for a fact that more LAMP leaders will be joining us soon,'' Zubiri said as he praised Magsaysay's defection. With reports from Armand Nocum, Juliet L. Javellana, Martin Marfil, Inquirer wires
Macapagal-Arroyo: 'I'm convicted without trial' (By Donna S. Cueto)
Manila, Philippines, October 18, 2006 (INQUIRER) - FORMER President Corazon Aquino's call for President Gloria Macapagal-Arroyo to either take a leave of absence or resign fell on deaf ears.
The President, in a speech before more than a thousand local government officials in Malacañang last night, said he would not step down.
The President had closed-door meetings with governors, mayors, congressmen, Malacañang lawyers and other advisers last night after Aquino urged him to take a leave of absence.
Executive Secretary Ronaldo Zamora said that the call for the President to take a leave of absence was not a "viable alternative" and not in keeping with the Constitution.
"We checked this with our lawyers and they tell us that this is not possible under that particular provision of the Constitution," he said after emerging from a meeting with the President.
"Essentially that refers to a situation where the President is disabled or is unable to fulfill for physical or mental reasons the functions of his office. That is certainly not the case in this particular situation. We don't think that this is a viable alternative," Zamora said.
He said Malacañang completely understood that the "route available under the Constitution" was the impeachment process.
"We are prepared to undergo that. The President certainly is," he said.
In an attempt to turn the tide of mounting opposition against him, Mrs. Macapagal-Arroyo hit back at Aquino and former President Fidel Ramos, who he said had left the country with lots of problems.
He then hinted that a sibling of a former President was "known in jueteng," an apparent broadside on Aquino and her brother, former Tarlac Rep. Jose "Peping" Cojuangco.
Mr. Estrada lashed out at his critics, saying they would "regret" what they were doing now once they learned the truth.
"When former President Aquino left, there were brownouts and power failures. But I didn't blame her. When President Ramos left, we had a financial crisis," Mrs. Macapagal-Arroyo said in Filipino.
The President again insisted that he was innocent of the charges hurled against him by Ilocos Sur Gov. Luis "Chavit" Singson.
He said he had not been accused of graft from the time that he was a mayor in San Juan. He claimed that his name was "clean" even during his days as senator or Vice President.
"I reiterate that I have not received a single centavo from jueteng. My wife and children also have not benefited from it since I became a mayor, senator, Vice President and President," she said in Filipino. "This is in contrast to a well-known brother of a former President."
Saddened
Mrs. Macapagal-Arroyo said he was "saddened" that Aquino and Manila Archbishop Gaudencio Cardinal Rosales had judged him without giving him a chance to answer Singson's charges.
"It's sad to think that I am being judged by Cory Aquino and Cardinal Rosales while a criminal is given his day in court," he said. "I'm convicted without trial," he said.
Mrs. Macapagal-Arroyo vowed that he would answer all the charges against him at a proper time. "I'm just waiting for all the charges to come out. So, why condemn me at this time?"
The President said he would also expose the "friends and cronies" of Aquino and Ramos with outstanding debts from government financial institutions.
"You will see how their cronies took advantage of government banks," he said.
The President claimed his friends and "cronies" never took advantage of the government.
He said he had borrowed planes from business tycoon Eduardo "Danding" Cojuangco because the presidential plane was a "flying coffin."
"Only the Vice President is happy whenever I use that plane," he said in Filipino.
Yesterday, mayors from all over the country flocked to the Palace to allegedly express their support for the President.
The mayors were so many that their queue reached the tree-lined driveway when they lined up to enter the sentry gates starting 2 p.m.
Those manning the sign sheets said there were more than 1,200 mayors and other local officials who had confirmed that they would attend yesterday's "Local Government Units and Indigenous People's Assembly" for the "National Day for Overcoming Extreme Poverty."
Loyalty check
Sources said the attendance sheet also served as a "loyalty check" for the mayors.
But San Juan Mayor JV Ejercito, LMP president, said yesterday's event was not a loyalty check.
The mayors said that a radio message on Monday from the Department of the Interior and Local Government and the League of Municipalities of the Philippines (LMP) called on them to go to Malacañang the next day.
They said the call was for them to express support for the President.
Many of them said that even without such a call they would still support the President, saying he should be given a chance to explain.
Besides the radio message, the LMP issued a memorandum enjoining its 1,522 members to pass resolutions supporting the President.
"With the current situation that the President of the Republic is facing, he needs now more support from us," the memorandum said.
"It is known to everybody how His Excellency helped and is helping the local government units, and his serious intention to reduce if not eradicate poverty," it said.
LMP spokesperson Mayor Raymundo Roquero of Valderrama, Antique, said the issuance of statements of support "is on a voluntary basis." With a report from Agnes E. Donato
Graft raps vs Macapagal-Arroyo alarm IMF, World Bank
Manila, Philippines, October 18, 2006 (INQUIRER) - THE INTERNATIONAL Monetary Fund and World Bank yesterday joined four local business groups in voicing concern that charges of corruption against President Gloria Macapagal-Arroyo are hurting the country's economy.
The statements of concern came even as the peso on Tuesday closed at 48.30 against the US dollar, up from 48.67 on Monday, due to drastic measures taken by the Bangko Sentral ng Pilipinas.
The 30-company Philippine Stock Exchange, however, dropped 23.27 points to 1,271, its lowest close in two years.
The World Bank's representative in the Philippines, Vinay Bhargava, said the lending institution had been consistently advising its member countries of the ''serious economic and social consequences of corruption, especially within government.''
But he said he expected the allegations would be quickly resolved ''through a due process within the legal system.''
In the worst crisis of his 27-month presidency, Mrs. Macapagal-Arroyo has denied Ilocos Sur Gov. Luis ''Chavit'' Singson's charges that he had pocketed hundreds of millions in kickbacks from tobacco excise taxes and payoffs from illegal jueteng operations over the past two years.
Finance Secretary Margarito Teves said the International Monetary Fund also expressed concerns that the allegations against Mrs. Macapagal-Arroyo had ''weakened the presidency.''
"But it's not a cause for alarm," Pardo told lawmakers in a budget hearing. "If we compare what's going on in other countries that they (the IMF) cover, this is nothing."
Pardo admitted, however, that the allegations have added to the concerns weighing on the economy and Philippine financial markets.
''It has added to the political uncertainty, but I disagree that this situation is that bad,'' said Pardo. ''I think this too will pass.''
Pardo said he remained confident that third-quarter economic data would show the economy expanded as strongly as in the second quarter, when gross domestic product grew a better-than-expected 4.5 percent on year on strong agricultural production.
4 groups
Even so, four business groups urged Congress on Tuesday to quickly resolve impeachment charges against President Gloria Macapagal-Arroyo.
In a joint statement, four business groups led by the influential Makati Business Club said the numerous scandals had marred the Macapagal-Arroyo presidency, spawning a ''crisis of leadership.''
"The President's involvement . . . in a series of scandals and allegations has seriously undermined the confidence of local and foreign investors in the government's ability to lead and to manage the economy,'' the groups said.
Joining in the statement were the Bishops-Businessmen's Conference for Human Development, Financial Executives' Institute of the Philippines, and the Management Association of the Philippines.
''We call on all members of Congress to rise above party lines and personal interests, and expedite the constitutional process and resolve this serious issue at the shortest possible time,'' the groups said.
The groups said political uncertainty would continue to undermine any prospect of economic recovery unless the crisis was quickly resolved.
BSP measures
Bangko Sentral ng Pilipinas Governor Rafael Buenaventura, however, said Tuesday the bank would continue to pursue measures to defend the peso, despite signs of some stability returning to the beleaguered currency.
Buenaventura declined to indicate what policy moves the bank was studying, saying ''we are not about to telegraph our moves.''
The Monetary Board, which sets central bank policies, may hold an emergency meeting today.
The peso has been sliding to new lows almost daily due to allegations that the President had received P414 million in jueteng payoffs and P130 million in kickbacks from tobacco excise taxes.
The allegations have sparked calls for his resignation from various sectors, including the influential Catholic Church, and seriously eroded investor confidence.
The options open to the central bank to defend the peso are for a further hike in the bank's overnight rates, increases in commercial banks' liquidity reserves, and continued intervention in the foreign exchange market.
Reports said the central bank was also considering issues of high-yielding Treasury bills.
''We will probably come up with something by tomorrow or today,'' Buenaventura said.
Board hasn't decided
Buenaventura said the Monetary Board had ''not made up (its) mind'' on a further increase in overnight rates. The bank's overnight borrowing rate now stands at 15 percent while its lending rate is at 17.25 percent.
On the issuance by the government of high-yielding Treasury bills to mop up peso liquidity, Buenaventura said: ''I really don't know if we will consider it.''
''Clearly, anything we are doing at the moment are all short-term measures to try and calm the market while the political tensions are being sorted out,'' Buenaventura told a group of Manila-based foreign correspondents.
A resolution to the political crisis, the worst to hit the 28-month-old Macapagal-Arroyo administration, should come within 30 to 90 days for interest rates to come down to ''normal'' levels and not impact on growth.
''You can't afford to have a too high interest rate environment for too long because you will sacrifice growth and therefore this must come to pass within the next three months,'' Buenaventura said.
''If after three months no solution has been made, it will put pressure on the exchange.''
He added business groups had indicated they could absorb the effects of high interest rates as long as they do not last beyond 90 days.
Peso strengthens
Last week's 400-basis-point increase in the central bank's overnight rates and the two-percentage-point increase in bank liquidity reserve requirements to 5 percent that took effect on Friday may have started to have an impact on the market.
The peso closed at 48.30 to the dollar on Tuesday, rebounding from its record low of 49 on Monday.
''Some of the measures taken earlier may have had some impact'' on the market, Buenaventura said. ''People are a bit calmer.''
Placido Mapa, president of the Bankers Association of the Philippines, said the impact of the central bank's measures, aimed at making investments on peso deposits more attractive and discouraging speculations on the US dollar, was slowly being felt.
Buenaventura said the central bank was also waiting for the impact of the additional two-percentage point hike in bank liquidity reserves to 7 percent that would take effect on Oct. 20.
A two-percentage-point increase in bank liquidity reserves could mop up about P23 billion from the financial system.
Buenaventura said ''there is absolutely no truth'' to rumors that the central bank was thinking of a currency peg.
He also said suggestions for the BAP to put up a trading band to quell the volatility in the peso like it did during the 1997 financial crisis had been rejected.
''They felt it (trading band) was not appropriate at this time. It is not the same situation as 1997,'' Buenaventura said.
He added any additional policy action the central bank would take must consider the impact on the economy's recovery.
''We will try to insulate the economic front so that we don't destroy the business environment and try to preserve the gains we have attained,'' referring to low inflation, low interest rates and a gross domestic product of ''over 4 percent.'' Reports from Clarissa S. Batino
Opposition vs Macapagal-Arroyo to be led by Noli (By Christine Avendaño)
Manila, Philippines, October 18, 2006 (INQUIRER) - VICE President Noli de Castro yesterday said she would lead the ''united opposition'' against the scandal-wracked Gloria Macapagal-Arroyo administration, and urged the Filipino people to show the world that the spirit of Edsa ''is still with us.''
Speaking at a news conference at the Philippine Village Hotel shortly after she arrived from a three-nation trip abroad, Macapagal said her main role now in the government was ''to reach out to different sectors so we can map out an alternative national agenda to restore propriety, stability and progress.''
She also said she did not want to call for President Gloria Macapagal-Arroyo's impeachment or resignation because, being next in the line of succession, she would benefit from either action.
She said she would meet with former President Corazon Aquino, a key figure in the 1986 Edsa uprising that toppled the Marcos dictatorship, ''about the plans for uniting the opposition.''
''Tactical details will he determined after that,'' she said.
de Castro arrived at past 1 p.m. at the Ninoy Aquino International Airport on board a Thai Airways plane. She was met by her colleagues in Lakas, Senate Minority Leader Teofisto Guingona, Representatives Feliciano Belmonte and Heherson Alvarez, other partymates and supporters, and a crowd of reporters, photographers and TV crew.
A phalanx of security escorts whisked her away from the tumultuous welcome to the nearby Philippine Village Hotel.
The news conference was attended by about 3,000 people, including de Castro's friends and supporters, members and officials of Lakas and of Promdi, political party of former Cebu governor and 1998 presidential contender Emilio ''Lito'' Osmeña.
Some members of the diplomatic corps, like Singaporean Ambassador Jackie Foo, also attended the conference, raising questions about whether their presence was meant to be a show of support for the Vice President.
US Embassy spokesperson Thomas Skipper was also present. But he said he was there merely to observe the proceedings.
''We're neutral,'' Skipper told reporters before the news conference started.
In Malacañang, Press Secretary Ricardo Puno said he did not think that the diplomats were trying to make a statement with their presence at the news conference.
But he said Foreign Affairs Secretary Alberto Romulo had been asked to look into the matter.
The people's Cabinet
In her speech, the former social welfare secretary said that ''after prayer and discernment,'' she ''left the Cabinet of the administration to join the true Cabinet of the people.''
''(I) believe it is my duty to do what is right and do my best, and then to let God take care of the rest,'' she said, quoting her father, the late President Diosdado Macapagal.
She said it was time for the country to ''begin the process to restore business and civil confidence.''
''We must show the world that the Filipino of Edsa is still with us. His spirit is alive. He has not lost his moral bearings. He will put his house in order,'' she said.
The first thing to do, she said, was for the people to unite.
Macapagal also said she would heed the call of former Defense Secretary Renato de Villa of Reporma-Lapiang Manggagawa and Osmeña of Promdi, both of whom urged the public the other day to rally behind the Vice President.
''In their call to action, I shall not disappoint them,'' she said, to the cheers of her audience.
Macapagal also urged the public to be vigilant, warning that certain groups might use the crisis now gripping the country ''as the means to preserve or grab power through the use of force.''
''Falsely they will invoke national interest. Let us not listen to false prophets,'' she said.
She also called on the people to be wary of the black propaganda that might be produced by those wanting to ''preserve the spoils of power.''
She reiterated the need for various sectors to draw up an alternative national agenda that would serve as the ''road map for the journey that the people now call on us to embark on.''
She also enumerated four core beliefs, saying ''our government'' should be bold; improve moral standards to provide a strong foundation for governance; institute new politics of party programs; and set leadership by example.
Election campaign
The hotel grounds appeared as though a big election campaign was being held there.
Organizers of the press conference distributed a program for party members, and supporters carried banners of welcome and support for Macapagal.
The back of a 10-wheel truck was converted into a stage where some Lakas members sang songs while awaiting the Vice President's arrival.
The messages on the banners read: ''Thank you for listening to the people,'' ''Pasay loves you,'' ''We love you.''
Skipper denied knowledge of reports that opposition members had phoned the US Embassy to seek US support.
He said the US government was ''not taking any side.''
Lakas spokesperson Hernando Perez said the diplomatic corps had been advised of Macapagal's news conference.
It was her first since she quit the President's Cabinet late last week in reaction to Ilocos Sur Gov. Luis Singson's charge that Mrs. Macapagal-Arroyo had received more than P400 million in jueteng money.
Perez said he was surprised by the turnout of members of the diplomatic community at the news conference.
Responding later to questions from reporters, Macapagal said that it was just a news conference and that people had come to welcome her.
Puno said Malacañang was clueless as to the ''context in which (the diplomats) were there, or the circumstances surrounding that particular assembly.''
''Normally, the diplomatic community is only invited to diplomatic functions. I do not think from what I know about the situation that this was a statement of any kind,'' he said, adding:
''But I am sure that our secretary of foreign affairs will inquire into the matter and see exactly what that was all about.
''They could have been invited, and things could have happened before they had a chance to make their exit. We will not jump to conclusions.''
National Security Adviser Alexander Aguirre has a categorical view.
''I would look at it as a normal duty of the diplomatic corps of monitoring and listening to what is happening in the country where they are posted,'' he said.
Aguirre said it was a welcome development that diplomats attended Macapagal's news conference. He said it allowed them to see that the Estrada administration had a ''living democracy,'' and that there was ''no curtailment of press freedom'' despite the ''denunciations or grievances'' against the President.
''We are showing that we are a mature democracy,'' he said.
Bong Pineda
At the open forum, the audience erupted into cheers when Macapagal, responding to questions on her alleged ties with suspected jueteng lord Rodolfo ''Bong'' Pineda, denied involvement in operations of the illegal numbers game.
She dismissed the ''flimsy efforts'' to link her to gambling as part of ''malicious attempts to disperse the issue.''
She declared: ''I do not associate with Bong Pineda. I do not associate with any gambling lord or drug lord. Their lifestyle is not my lifestyle.
''I do not drink with them, I don't play mahjong with them, and I'm not associated with them in business.''
On the calls for her to resign together with the President to pave the way for a special election, Macapagal said she would not step down.
She called on the public to refrain from engaging in ''petty political rivalries that get in the way of constitutional processes.''
She suggested the formation of an independent body to investigate the charges against the President.
Bohol Rep. Ernesto Herrera said that while it would be no easy task to unite the opposition, it was possible.
Asked to assess the impact of de Castro's announcement that she would lead the united opposition, Herrera said this would put further pressure on Mrs. Macapagal-Arroyo to resign.
But the Bukluran ng Manggagawang Pilipino said in a statement: ''The people should not be made to choose between the lesser of two evils, between Gloria and Noli. The people must have a third way, a real choice for good government.''
It said all top officials of the government should resign so that Chief Justice Hilario Davide could head ''a caretaker government of national renewal.'' With reports from Armand Nocum and TJ Burgonio
AFP won't recognize de Castro if Macapagal-Arroyo is forced to quit (By Carlito Pablo and Blanche S. Rivera)
Manila, Philippines, October 18, 2006 (INQUIRER) - NATIONAL security adviser Lito Banayo said yesterday the Armed Forces of the Philippines and the Philippine National Police will not recognize any successor to President Gloria Macapagal-Arroyo if the embattled Chief Executive is forced to resign.
''If the President is forced to resign against his free will, the successor is not constitutional and the AFP will defend the Constitution,'' Aguirre said in a press conference.
The Constitution provides that the Vice President succeed the President if the latter resigns from office.
Obviously referring to Noli de Castro, Aguirre asked: ''If you remove the President against his free will, what will prevent other groups from doing the same to his successor, the Vice President?
''Taking any action to force the President to resign, that in itself is doing violence to the Constitution and constitutional processes,'' he said.
Aguirre pointed out that the constitutional process of removing the President is through impeachment.
Taking potshots at former President Corazon Aquino and Manila Archbishop Jaime Cardinal Sin who have called for Mrs. Macapagal-Arroyo's resignation, Aguirre said.
''If the President says he will not resign to fulfill his sworn duty under the Constitution, then no one has any right to force him to do so.''
Aguirre said that while the government will respect the right of the people to demonstrate, it will not allow rallies that cause the ''disruption of law and order and political stability,'' such as when demonstrators would physically occupy Malacañang and force the President out of office.
Aguirre warned of bloodshed should the President's critics resort to extra-constitutional means to force him out.
''The soldiery including myself are willing to shed blood to defend the constitutional processes. We will prevent it from happening, so it will not happen,'' Aguirre said.
Aguirre, however, allayed fears of an upheaval in the country similar to what happened in Indonesia.
''Our country is not another Suharto's Indonesia because the President is not a dictator and our democratic institutions are alive and working,'' he said.
The INQUIRER has learned that the AFP is thinly spread in Luzon even as talk of a coup or the imposition of military rule swirl in the metropolitan area. Of the eight divisions of the Philippine Army, only two divisions and one brigade remain on the island.
These are the 2nd Infantry Division operating in Southern Luzon, the 5th ID in Northern Luzon and one Army brigade of the 7th ID for Central Luzon. The bulk of the 7th ID, which was based in Nueva Ecija, was deployed to Eastern Mindanao last September to fight communist rebels operating in the Caraga region and the Davao area.
The 3rd and 8th Ids are operating in the Visayas.
In Mindanao the 4th and 6th Ids are squared off against the Moro Islamic Liberation Front, and the 1st ID is covering the Zamboanga peninsula, Basilan and Sulu.
Of the four light armor battalions of the Philippine Army, two remain in Luzon while the other two are in Mindanao.
Also in Mindanao are all three of the Philippine Marine Brigades.
As is normal practice in the Marines, only one battalion is maintained at its headquarters in Fort Bonifacio, Makati but only for retraining and re-equipage purposes.
In an interview over dzXL yesterday morning, AFP spokesperson Brig. Gen. Generoso Senga was asked how the military will respond to demonstrations to be held by critics of the President who are demanding his resignation.
''We are simply watching the events. We're sure the police will be able to ensure peace and order,'' Senga said.
Gen. Edgar Aglipay, director of the National Capital Region Police Office, shrugged off alleged threats to the stability of the country by forces out to unseat the President.
Aglipay said his office had not received any reports of the terrorism that would allegedly be perpetrated by forces identified with former President Fidel Ramos.
Earlier, Aguirre himself had casually dismissed the threats of bombings and arson predicted by the President.
Aglipay also denied the PNP was deploying additional personnel to Metro Manila, as reportedly ordered by the President.
He said there has been ''no order from above'' to bring in more police or reinforcements from the Marines and the Philippine Air Force.
He said the only military people in the metropolis right now are those not being used in Mindanao.
Like Aguirre, Aglipay refused to categorically state that he was contradicting the dire predictions of Malacañang.
''I have not received reports about any predicted bombings and arson in Metro Manila,'' Aglipay said in an interview shortly after the mass for national enlightenment led by Cardinal Sin and former President Corazon Aquino at the Edsa Shrine Tuesday.
''But he must have sources of his own because he's the President,'' he added. Aglipay stressed, however, that the PNP was ''prepared for any eventuality,'' adding the 15,000-strong force based in Metro Manila's five police districts was always on its toes against possible terrorist attacks in the urban areas.
President Gloria Macapagal-Arroyo had earlier said his opponents were ''planning to burn, throw bombs in the streets to sow terror and confusion in (the) country'' to force him to step down and relinquish his position to Vice President Noli de Castro.
Ramos, Salonga back 'Macapagal-Arroyo resign' call (Reports from TJ Burgonio, Christine Avendaño and Alcuin Papa)
Manila, Philippines, October 18, 2006 - FORMER President Fidel V. Ramos and former Senate President Jovito Salonga yesterday joined calls for President Gloria Macapagal-Arroyo to resign while Vice President Noli de Castro focused her efforts in uniting the opposition.
"The continuous hemorrhage of the economy, the hardship of the people must be solved by the voluntary act of resignation by President Gloria Macapagal-Arroyo," Ramos said upon his arrival from a speaking engagement in Indonesia.
He also called on former members of his Cabinet to resign from the Gloria Macapagal-Arroyo administration.
''They're the ones who know the difference between effective governance and ineffective governance. They should not be part of this ineffective government,'' Ramos said.
Former officials under the Ramos administration who are now serving President Estrada included Public Works Secretary Virgilio Vigilar, Foreign Secretary Domingo Siazon Jr., Presidential Security Adviser Alexander Aguirre III, and housing czar Leonora de Jesus.
Salonga
The civic group Kilosbayan led by Salonga, and its two other sister organizations also said resignation was the President's best option.
In a joint meeting at 9:30 a.m. at the Kilosbayan House in Mandaluyong presided by Salonga, the three groups said the impeachment process ''will probably work in favor of President Estrada's desire to stay on'' but that his resignation ''will be less cumbersome and more realistic.''
A snap election, according to the groups, is an extra-constitutional act which ''might be less humiliating for him but it may lead to a social upheaval reminiscent of Edsa and the recent people power revolution in Yugoslavia.''
In a press statement, the groups said that the President ''does not seem to appreciate the import of his oath of office and his responsibilities as the father of the nation, nor does he seem to realize the magnitude of his wrongs.''
The groups said no president in the country's history, with the exception of the dictator Ferdinand Marcos, ''has gone down so low in terms of crudity and shameless exploitation of the poor in many provinces.''
Macapagal
Vice President de Castro said he had met with former Defense Secretary Renato de Villa of the Reporma party and former Presidential Adviser for Mindanao Paul Dominguez of the Promdi party regarding her plan to form a united opposition.
Macagapal of Lakas-NUCD said the Partido Sosyalista ng Pilipinas had also signified its intention to join the umbrella group.
She said she was also holding talks with other groups.
''We talked about how we can put together all our different platforms so we can forge a consensus on a national agenda,'' said de Castro who had resigned her post as secretary of the Department of Social Welfare and Development.
Earlier, De Villa and Lito Osmeña, head of Promdi, called on the President to resign and urged de Castro to unite the opposition.
Wiretapping
Asked to comment on a taped conversation allegedly between him and former mistress Rosemarie ''Baby'' Arenas about the improbability of a people power revolt, Ramos said this was the result of an illegal wiretapping operation.
''The concerned authorities must look into this,'' he said.
''The parties who wanted to put rumor, speculation or unverified information to the attention of the public must have been the source of the tape and the ones who did the wiretapping,'' he said.
He voiced suspicions that the Philippine Long Distance Telephone Company must have been pressured by the Macapagal-Arroyo administration to do the wiretapping.
''The leaders, including the President, do not seem to know the difference between what is raw information and processed intelligence by the way they bandied around rumors and speculations coming from a wiretap as if it was the truth of the matter,'' he said.
