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Seeking Funds For National Development.doc

Seeking Funds For National Development.doc

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short essay on Philippine debts
short essay on Philippine debts

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Categories:Types, Research
Published by: David Michael San Juan on Jun 17, 2013
Copyright:Attribution Non-commercial


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Seeking Funds For National Development,Freeing The Country From The Debt Trap
 As evident in the analysis of the 11 selected segments of the PDP, thePhilippines needs to immediately implement basic economic reforms to build the basefor a strong people-centered economy, specifically through implementing land reform,agricultural modernization, and industrialization. All these reforms, more especiallyindustrialization, require capital – and aside from tax reforms that will be discussed later in this segment of the dissertation there are other ways to raise capital foindustrialization endeavors, without seeking foreign investors whose interest at timesclash with the Philippines’ national interest. Instead of foreign investments, Filipinosmust use indigenous capital to develop their country. Stopping foreign debt paymentsand decreasing domestic debt
payments should be implemented so that the country willbe able to instantly raise capital for the implementation of various socio-economicreforms. To jumpstart this, the Philippine government needs to cancel automatic debtappropriations by junking Section 31 of Presidential Decree 1177 (imposed by theMarcos dictatorship), and also Section 26, Chapter 4, Book VI of Executive Order 292(Administrative Code of 1987) which is almost an exact copy of Section 31 of PD 1177.This is an act related to international debanksterization, as stopping foreign debtpayments for a decade would certainly weaken the control of multinational financialinstitutions and their local tentacles on the country’s economy. To justify the need for 
Part of a draft dissertation (2013) for a PhD in Southeast Asian Studies (Centro EscolarUniversity-Manila). The endnotes are still incomplete. This was posted for the benefit of citizens who need instant information on Philippine debts.
San Juan, David Michael M. “ADependency Theory Critique of Selected Segments of the Philippine Development Plan (PDP2011-2016)” 
temporarily stopping debt payments, it is necessary to briefly discuss the nature of thecountry’s debt problems.In a span of 13 years, (2000-2013), the Philippine government spent8,240,289,000,000 pesos for debt payments. Using just this amount, the Philippinegovernment can easily put up job-generating firms and factories for its citizens. A tableshowing detailed debt payments and debt data from the Bureau of Treasury is supplied:
Philippine Debt Payments
and Outstanding Debts
in Pesos (2000-2013)
 YearInterestPaymentsPrincipal DebtPaymentsTotal Paymentsper year OutstandingDebts
GRAND TOTAL3,637,636,000,0004,602,653,000,0008,240,289,000,000
Unfortunately, Philippine debts pile up even as the government pays its creditorshumungous sums every year. It must be noted that in 1947, the second year of the theRoxas administration, Philippine debts stood only at 62,964,649.98 pesos
. In the year 2000, Philippine debts have ballooned to 2,166,710,000,000 pesos. At the end of 2013,Philippine debts are expected to reach 5,800,000,000,000 pesos. From 2000-2013, thePhilippine government would have shelled out 8,240,289,000,000 in debt payments, yet
instead of wiping out its debts, the amount of its debts more than doubled! It is notsurprising that such horrendous scheme imposed by the IMF and the World Bank iscalled as debt trap by some in the academe, a scheme where the Third World’s wealthgoes to the First World financial institutions and its tentacles in the Third World, pushingthe Third World to permanently trap itself in the vicious cycle of acquiring more andmore debts. As the country pays its debts, its debts multiply because it uses new loansto pay for old ones – at a rising interest rate, most of the times. It is unable to use itsnational budget to develop income-generating industries that will enhance its self-reliance. The humungous funds allotted for debt payments mean lesser and lesser budget too for badly needed social services such as education and health care (which inturn would have ensured that the country’s citizens will be educated and healthy enoughto effectively contribute to the country’s development endeavors). Hence, the countrymust free itself from the debt trap if it is to achieve genuine growth and development.The solution lies in issuing a moratorium on debt payments for at least 10 years,so that the savings could be used as capital for establishing industries, modernizingagriculture, and implementing other reforms. After 10 years, the country will be able topay all its debts from the profits it has gained from industrialization. Aside from temporarily stopping debt payments, debt repudiation is another option that can be implemented to gain funds for national development. According ro aresearch by the African Forum and Network on Debt and Development o AFRODAD(2007
), from 1986 to 2006, Filipinos paid US$1,900,000,000 billion, ¥23,000,000,000and CHF (Swiss Franc) 107,100,000 to those who funded the Bataan Nuclear Power Plant (BNPP). This anomalous and overpriced nuclear plant was established by the

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