current economic issues in the philippines 2012

current economic issues in the philippines 2012 : Inflation in the Philippines eased to its lowest
level in more than two years in March, supporting the central bank's view that its record-high policy rates
are keeping prices under control.

Despite the latest data, analysts expect Bangko Sentral ng Pilipinas to keep rates unchanged this year because of
uncertainties in the global market and the likelihood of further increases in the price of oil.

The headline inflation rate in March was at 2.6%, down from 2.7% in February, the National Statistics Office
reported Wednesday. Slower price increases for alcoholic beverages and tobacco as well as clothing and footwear
were the main factors, the data showed; rises in housing and utility costs also eased.

The March reading, the lowest since the 2.2% of September 2009, indicates that inflation in the country will be
manageable during the current policy horizon, central bank Gov. Amando Tetangco said.

economic problem in the philippines 2012

Still, old problems remain. In early March, Aquino said he had ordered an inquiry into reports of an alleged plot
to overthrow him, and he is wresting with violent Maoist and Muslim rebels and a worsening security situation.

Corruption and creaking infrastructure are also difficulties for Aquino, as Manila tries to press its claims in the
contested South China Sea, and manage its changing relationships with China and the United States.

Ratings: Unchanged since March

S&P: BB
MOODY'S: Ba2
FITCH: BB+

The cost of insuring against default on 5-year sovereign debt was around 140 basis points at the start of April
2012. It has traded choppily after rising to its highest in nearly 2-1/2 years last September.

Following is a summary of political risks to watch:

Internal security

Internal security remains a weak spot, persistently highlighted by foreign embassies in travel advisories, with law
enforcement hobbled by corruption, lack of police resources, and easy availability of guns on the street.

In late November, a crude bomb exploded near a memorial for 58 victims of the Philippines' worst election-
related violence hours before the start of a rally to commemorate the attack two years ago. That followed deadly
fighting in October between Philippine soldiers and a group of Muslim separatists on a southern island forced
thousands of people to flee their homes and created a new problem for stalled peace talks to end the long-running
insurgency.

Aquino held talks with the Moro Islamic Liberation Front's (MILF) leader in Tokyo last year to accelerate the
peace process, but momentum appeared to have stalled after the separatists rejected Manila's proposal to end the
conflict.

MILF is not the only active rebel group. In October, around 200 Maoist guerrillas attacked three private mining
projects on southern island Mindanao, destroying around $70 million worth of equipment, and threatening more
attacks. In late March, communist rebels from the New People's Army (NPA) threatened to attack power
companies in the south.

Also in the south, three people were killed in a bomb attack in Zamboanga city in November, the third hostel
bombing in the south since September. The attacks were blamed on an Islamist militant group. In January,
Aquino warned against a possible Islamist militant attack in the capital on the eve of a religious procession.

What to watch:

The army's patience with the peace process, and with Aquino. Coup attempts are not unknown in the Philippines,
and some within the army are angry with Aquino for not taking a tougher line with MILF.

Any more attacks on mines or other businesses, and how investors respond. The Philippine army has said it lacks
the resources, so has asked firms to hire private militias to guard their businesses.

The Maoists are refusing to return to talks until some prisoners are released, and they continue to attack
government forces.

Political and economic challenges

The cities of Cagayan de Oro and Iligan will require large-scale rebuilding after the December storms.

In late December, Aquino declared a state of national calamity and ordered an investigation into the disaster. He
said Manila would use more than 1 billion pesos ($22.79 million) in calamity funds and soft loans from
multilateral lending agencies such as the World Bank for reconstruction.

More than $20 million of foreign aid has been donated to the 300,000 people left homeless by the floods.

Aquino remains immensely popular with voters, and his administration seems to have regained momentum after
a lull in the first half of 2011 when he was criticized for a lack of drive.

The arrest in November of former Philippine leader Gloria Macapagal-Arroyo for vote rigging has put Aquino's
anti-graft stance firmly back in the public eye, but there is also a risk that the Arroyo case could create
uncertainty for investors if it becomes a protracted political and legal battle, and prove a distraction from the
work of economic reform.

The government's strength has been economic management, including reducing the budget deficit by improving
revenue collection and controlling spending, but the worsening outlook for the global economy is hitting the
Philippines.

In January, the central bank cut its key policy rate by 25 basis points to 4.25 percent, as widely expected, while
February inflation eased to its lowest in more than two years Source newsinfo.inquirer.net

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Based on these economic issues i can say that the Philippines is really undergoing a hard time these days, the
Philippines is trying to recover from the rapid economic changes in the past. These issues are really having a big
deal in the society. Corruption and creaking infrastructure are also difficulties for Aquino.

I chose these issues as the topic and the subject because i know these are few of the issues that really difficult
challenges that the President and the country face.

Internal security remains a weak spot, persistently highlighted by foreign embassies in travel advisories, with law
enforcement hobbled by corruption, lack of police resources, and easy availability of guns on the street.
Nowadays, lots of bombing and mass killings are happening around the country. The issue bout internal security
is that now the people of the Philippines are not really confident enough to trust the capacity of the officials to
really help the country in peace and order.
In terms of the political and economic challenges that the country face is within the cities of Cagayan de Oro and
Iligan that were affected by storms and flood late last year. Through these people saw the effort done by the
administration to help the affected areas and to help them rebuild their houses and be able to recover from what
happened.

The government's strength has been economic management, including reducing the budget deficit by improving
revenue collection and controlling spending, but the worsening outlook for the global economy is hitting the
Philippines.

I know that sooner or later, the country will be able to recover from everything happened in the past and will start
anew to rebuild the country. With the help and effort of the President, i know that the people will cooperate and
will help one another to surpass all these challenges.