Teves clarify the U$ 10 billion fund from World Bank

Miami
October 20, 2008
Story: Teves clarify the U$ 10 billion fund from World Bank

Department of Finance Secretary Margarito Teves finally clarifies the issue on U$ 10 billion fund that the World bank will give to the country as mentioned by President Gloria Macapagal- Arroyo on her speech last week.

Teves said that there will be a ready U$10 billion from World Bank in response to the global financial crisis, but this could have been submitted to a more formal discussions then approval.

“The U$ 10 billon is not for ASEAN region alone, but whoever who will need it or for worldwide support. Please do remember that this is an initial discussion,” Teves said.

Teves added that the World Bank supports the plan of the ASEAN to have its own regional standby facility funds to help the countries under ASEAN but the World Bank has no plan yet to fund this.

“Our region (ASEAN) has not been subjected yet, not in comparison to what is happening to the US,” Teves said. The World Bank indicated that they are ready to assist in drawing up the mechanism to implement this initiative.

The plan is bilateral one, meaning countries will have bilateral swap arrangements, and in the case of need they can draw on this bilateral swap. The other component is the ASEAN swap, in which all ASEAN members contribute to a fund and it can draw on the same fund, resources which are critical that will require to draw from that facility.

“This is an ASEAN initiative that is being propose, there are bilateral assistance taking place and that bilateral assistance will continue, however, we like the ASEAN members to consider setting up this kind of initiative,” Teves explained.

Its aim is addressing the balance payment requirements but Teves is not yet sure about the figure that will be released.

“The proposed regional standby facility funds should be fairly sizeable, quick disbursing, and with minimum conditionalities,” Teves said everything will still be subject for formal meeting and approval.

Teves added that announcement of the President was consistent after all, “She announced a facility to assist ASEAN countries and other regions as well.”