‘Our number one priority is fiscal discipline’
CUTTING THE INHERITED BUDGET DEFICIT AND TARGETING FISCAL BALANCE BY 2006 ARE THE TWIN PRIORITIES OF SECRETARY OF FINANCE JOSE CAMACHO WHO OUTLINES THE GOVERNMENT'S VISION BELOW

JOSE ISIDRO N. CAMACHO Secretary of Finance

Most political analysts agree that the brightest star of the Arroyo administration is without a doubt Secretary of Finance Jose Isidro N. Camacho, who also happens to be the country’s youngest cabinet member. After a few months at the head of the Energy Department, Mr. Camacho’s skills became immediately apparent and in May he was shifted over to take up the finance portfolio to tackle the country’s current economic slowdown. In an exclusive interview, Mr. Camacho discusses the government’s efforts to boost recovery.

What are the key economic policies of this government? What is its economic direction?
I think it is important to first look at our basic economic philosophy, which is grounded on free enterprise and is comprised of three very important components. It begins with the determination of the president to win the war on poverty over the next decade, and the strong belief that you can only do that by creating jobs.

What are these three components?
The first is fiscal discipline. One of our immediate problems is the substantial deficit that we inherited from the previous administration. We are maintaining our target budget deficit of 145 billion pesos (US$2.8 billion) for this year and targeting a fiscal balance by 2006.

Why is that so important?
Because it not only signals our discipline on spending or creating revenue, but a large uncontrollable fiscal deficit would require us to go to the financial markets and put us in competition with the private sector for capital.
The second component of our economic philosophy is market reforms, which have been going on for a long time and really gained momentum during the Ramos administration from 1992 to 1996. We intend to continue with that.

What would be a recent example?
As you may know, we just passed the Power Reform Bill in June. And that was probably one of the last major reforms that we need to legislate. There are many more, but it is more like cleaning up now.
The third aspect of our economic philosophy is to push for good governance, which I think is such a soft term. You could really translate that to good management, as if you were talking about a corporation.

What would that consist of?
It consists of efficiency in running your government, cutting out the red tape. This president has been very effective and will continue to be effective because she is translating everything into time-bound deliveries, so that we can measure ourselves, the president can measure us and the country can measure this administration.