Announcement of Meeting to Consider the Establishment of a Consultative Group for the Philippines on October 2, 1970

INTERNATIONAL BANK FOR • RECONSTRUCTION· AND DEVELOPMENT 1818 H STREET, N,W., WASHINGTON D. C. 20433 TELEPHONE, EXECUTIVE 3-6360 uo 1ol""1 \ ;I October 2, 1970 Subject: Meeting to consider the eatab• lishment of a Consultative Group for the Philippines The following announcement was made today by the European Office of the World Bank in Paris: "A meeting to consider the establishment of a Consultative Group for the Philippines was held in Paris on Octobllr 1 1,nd October 2, 1970 under the chairman• ,ship of the World Bank. Representatives of the following countriea were preaent: Australia, Canada, France, Germany; India, Japan, the Netherlan~,. New Zealand, -·~ .. .;:... - T---~•. --- --- • ~--• ..,:;:....~·•-.,;._•~...:....--'f, ... - -" ......._ ;# • • Spain, Switzerland, the· United Kingdom and the United States~ Also .epresented 11 were the International Monetary Fund, the United Nations Development Programme. • the Asian Development Bank, and the Organization for Economic Cooperation and Development. The Philippines delegation was led by The Honorable Cesar Virat•, Secretary of Finance. "The meeting noted the current economic difficulties of the Philippines, and was informed in a message from President Marcos of the determination of his Government to re-establish financial stability and foster economic and social development. The President also expressed his appreciation to the governments attending for their interest in the Philippine problems. "The measures of fiscal and monetary restraint already taken by the Govern- 1n.ent to stabilize the financial situation were reviewed at the meeting. It was agreed that, while continuing stabilization measures would be necessary, im- pressive progress had already been made in the effort to restore financial • stability to the.economy. Although the balance of payments situation was still serious, export earnings had increased by 22 per cent in the first /'!Jore Unn. Bank p.r. - Meeting to consider the estab- lishment of a Consultative Group for the Philippines ficant improvement in the trade balance. - 2 - t..1ght months of 1970 and import demand had been restrained resulting in a signi- • .. "In considering the longer term outlook of the Philippine economy, the meet- 1( h'1g noted the su!ls tant ial advance of the economy over,> the last two decades , and the large potential for further economic progress~ It was recognized that the availability .of ample natural resources, together with high private saving and a dynamic private sector provide the Philippines with favorable opportunities for rapid economic growth. It was also noted that realization of these opportuni- ties will £equire greater eff?rt to in~rease public resources and reforms in the a,~ministration ot public-' developmen~ programs. "The review of the longer term prospects was in the context of the Philippine~ Fcur-Year Development Plan for the years 1971-1974 and a report of a recent econoi~ic mission from the World Bank. Statements on the Plan were made by Secretary Vir&tu and The Honorable Placido L. Mapa, Jr., Director-General of the Presidential • E.::cn.omic Staff. The overall growth targets established in the Plan were generally accepted to be realistic and the priorities in line with the needs of the economy. "Given the difficult balance of payments situation it was noted that for the next few years the investment and growth targets as indicated in the Plan were mvdest in relation to the Philippines longer run capabilities. With effective m~nagement, however, it was agreed that the present financial difficulties could be overcome within a fairly short period and that economic growth thereafter could be accelerated. The meeting recogitzed that an appreciable inflow of de·;;elopment assistance from abroad would 1>;.~, required in the next few years to 3ustain the development effort. Both privi~e foreign investment and public development aid would be needed. In view of the important role of private fo~eign investment the meeting welcomed the assurances of the leader of the Philippines delegation that consistent policies would be pursued by the a~!thorities to increase the flow of private capital from abroad. "Support for the Bank's proposal to form a Consultat.ive Group for the ~hilippines was expressed by several governments and agencies which indicated • ~rt..eir intentions to join such a group. Others were not in a position to com- m.it their governments to membership but undertook to inform the Bank of their decision -- if. possible by November 1, 1970." - 0 -