Press Release
March 5, 2011

ANGARA FLAGS CAPITAL MARKET DEV'T AS PRIORITY FOR 2011

In a recent interview, Senator Edgardo J. Angara tagged the development of the Philippines' capital market as the key to a more robust, job-creating economy in 2011, and called on the administration to immediately put vital financial legislation in effect.

"The aim of building up the nation's capital market is to provide a source of funding for small to medium businesses. Capital market development through corporate financing creates more businesses, which will result in more employment opportunities," he explained.

The issue of corporate funding was first brought up during last week's Commission on Appointments hearing to confirm the interim post of Secretary Cesar Purisima as the head of the Department of Finance.

"In the Philippines, 90% of enterprise financing is through bank borrowing. But we all know how difficult it is to get a loanóthey want a whole lot of collateral and even then they set such high interest rates," Angara said during the hearing.

According to Angara, the legislators had done their part by establishing several different programs which facilitated the acquisition of financing in the country.

"We set up the Personal Equity and Retirement Account or PERA which sets up individual pensions through regular contributions, and the Credit Information Bureau which enables easy background checks for lending companies," said the veteran legislator.

Angara, vice-chair of the Finance Committee, also mentioned the Real Estate Investment Trust (REIT), which he helped create by authoring the REIT Law. REITs are public real-estate companies which pay out 90 percent of its profit to the shareholders. These programs, he said, would advance the fiscal system in the country to a great degree but hadn't been properly implemented until now.

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