Business Leader Expresses Worry Over Coup’s Effect on Economy With PM-Philippines
MANILA, Philippines (AP) _ Last week’s bloody coup attempt will likely set back government efforts to rejuvenate the economy as foreign companies wait for a more stable political situation, a top business leader says.
″There are a number of foreign investors who have been seriously considering their entry into the Philippines,″ says Aurelio Periquet Jr., president of the 20,000-member Philippine Chamber of Commerce and Industry.
″After last Friday’s affair, some of these investors will probably wait a little longer. If so, this could set back another several months our recovery effort,″ he said in a telephone interview Monday.
Hundreds of rebel troops attacked the presidential palace, television stations and the armed forces headquarters in a bloody mutiny that left at least 37 people dead and nearly 300 wounded, including the only son of President Corazon Aquino.
Although the coup was crushed within 32 hours, some rebels were still at large north of the capital today.
Since Mrs. Aquino came to power 18 months ago, she has focused on rebuilding an economy that deteriorated during the 20-year rule of Ferdinand E. Marcos. The country has a $28 billion foreign debt.
Marcos, who fled into exile Feb. 26, 1986 during a military-civilian uprising, was accused of funneling billions of dollars out of the Philippines for his personal use.
The economy nose-dived after the 1983 assassination of opposition leader Benigno Aquino, Mrs. Aquino’s husband. Investors, fearing political instability, kept their capital out of the country, and other governments and international financial institutions withheld aid. Local entrepreneurs began investing abroad instead of at home.
After Mrs. Aquino took power, the economy began to turn around as foreign aid and investor confidence grew.
After two years of decline, the economy grew marginally in 1986 and posted a 5.5 percent increase during this year’s first quarter.
Foreign investment rose to $38 million in the first seven months of 1987, an increase of 53 percent from the corresponding period the year before.
Western diplomats say the rate might have been higher except for fears of political instability. The government has faced an 18-year-old communist insurgency, labor agitation and rising crime, which jumped 30 percent in Manila during the first half of this year.
Periquet said much of the new investment has come from Taiwan and Japan, where the yen’s appreciation has sent manufacturing costs soaring. He said further foreign investment would be needed to spur economic development.
″I just had visitors from France ... and they do not seem to view this (the coup attempt) as a cause alarming enough for them to rethink their original plans″ to invest in manufacturing, Periquet said.
But when asked if the visitors’ investment might be delayed, Periquet responded: ″It would be natural, businessmen tend to be prudent in making their final decisions.″
Business World, the nation’s major business daily newspaper, said Monday that the coup brought ″a shaking up of business confidence and renewed uncertainty over the investment climate.″
Officials overseas also expressed concern. Japanese Foreign Minister Tadashi Kuranari said Saturday that the Philippines ″must achieve a stable political situation before it can have economic stability.″
Still, Periquet said the resolve the government shows in quelling the coup was applauded by the business community.