RP must mitigate effects of global slowdown - Loren

Senator Loren Legarda cited today the need for the Philippines to undertake measures that would cushion the local economy from the effects of a feared global economic slowdown.

Legarda said that despite the rebound posted by Asian stock indexes Wednesday after steep losses in the previous two days, the Philippines should brace itself for continuing concerns over the US economy and its impact on other countries.

"We may be seeing a roller-coaster ride as far as stock markets are concerned," said Legarda, the chair of the Senate Economic Affair Committee. "There is a need to look at measures to mitigate the effects of a global downturn on us."

The rebound posted by Asian stock markets yesterday was spurred by a surprise interest rate cut undertaken by the US Federal Reserve.

Legarda said there may be a need for her committee to gather together government economic managers, businessmen, the academe and all other concerned sectors for an in-depth look at global and local economic developments.

Over worries that the US economy, battered by a housing credit crisis, could enter a recession, investors had dumped stock shares in frenetic trading in the past few days.

Aside from the interest rate cut, the US had also announced an economic stimulus package that includes a proposed $150 billion in tax cuts.

Legarda said that globalization has coupled the economies of countries that the Philippines needs to keep track of international market developments as they have immediate, medium term and long term impact on the local economy.

"Any economic slowdown would result to job cuts, which our countrymen cannot afford at this time, as underemployment, as it is, remains a big problem in the country."

Legarda said the Philippines must go back to the basics of aspiring to become self sufficient, especially in areas like agriculture and production of goods that are deemed basic necessities. She said government talks of the Philippines seeking more trading partners to decouple itself from any one foreign economy like the US can not be expected to have immediate results, but that just the same the strategy is generally okay.

"We should not put all our eggs in one basket," Legarda said.