Finance Secretary Carlos Dominguez III said the impending end of the drawn-out conflict in Marawi City will further boost investor confidence in the economy, more so now that the government can focus on a comprehensive plan to reconstruct the southern city and provide economic opportunities for its returning residents.
Dominguez said the record performance of the stock market following President Duterte’s announcement last Tuesday of the “liberation” of Marawi City from Islamist militants pointed to the positive investor sentiment on the end of the conflict.
The Philippine Stock Exchange Index (PSEi) gained 49.80 points or 0.59% to end 8,497.74 on Tuesday. That day’s stock rally saw an 8,586.73 intraday peak.
Beginning of the Rehabilitation
The President announced Marawi’s liberation after the deaths of terrorist leaders Isnilon Hapilon and Omarkhayam Maute in the hands of military sharpshooters during a predawn offensive on Monday. The two Islamist militants led the attack on Marawi last May 23.
According to the military, although the fighting in the city was not completely over, the remaining rebels were “stragglers” who no longer posed a threat.
President Duterte said Marawi’s liberation marked the “beginning of the rehabilitation” of the city.
Dominguez noted that even with the crisis in Marawi City and the declaration of martial law in Mindanao, the business community has remained bullish on the economy and supported the President’s decisive action to deal with the terrorist attack.
“We expect investor confidence to strengthen further and the economy to grow even faster now that the conflict has been virtually resolved and the government has started raising spending on infrastructure and human capital development, which will supercharge growth and create more jobs for our people,” Dominguez said.
The government still has to conduct clearing operations and assess the extent of the damage in Marawi so that it could come up with a detailed recovery, reconstruction and rehabilitation program for the city, but efforts are now underway to provide immediate assistance to displaced residents and open up economic opportunities that would enable them to get back on their feet and rebuild their lives.
President Duterte created last July an interagency task force chaired by Defense Secretary Delfin Lorenzana that will spearhead the recovery, reconstruction and rehabilitation program for Marawi City.
Although the Department of Finance (DOF) is not a member of the Task Force, it is involved in the fund-raising aspect for the program, with Dominguez revealing plans last August for the Bureau of Treasury to sell “patriotic” bonds to aid in Marawi’s rehabilitation.
Earlier, Dominguez reported that World Bank chief executive officer Kristalina Georgieva has confirmed the institution’s commitment to work with the Philippine government in helping conflict-torn Marawi City rise from devastation, along with scaling up support for peace-building efforts in Mindanao.
In a recent meeting in Washington DC with Philippine officials led by Dominguez, Georgieva said the World Bank can provide technical aid and other forms of assistance to the Philippines to help rebuild Marawi City.
Georgieva also welcomed Dominguez’s plan to tap domestic resources to raise funds for Marawi’s reconstruction, which, she said, was “the right thing to do” and underscored the importance of “inclusive development” as a key aspect of the rehabilitation strategy for the city.
“We can only express all of our sympathy for what has been going on in Marawi,” said Georgieva during the meeting held at the World Bank office.. “As an institution that has committed to peaceful development and dealing with conflict situations, we would be honored in helping in terms of [re]building and engaging in any possible way what we can do in this situation,” Georgieva said.
Besides Dominguez, also at the meeting were Secretaries Alan Peter Cayetano of the Department of Foreign Affairs (DFA) and Ernesto Pernia of the National Economic and Development Authority (NEDA).
Mara Warwick, the World Bank country director for Brunei, Malaysia, the Philippines and Thailand, was also at the meeting.
On behalf of the Philippines, Dominguez thanked the World Bank “for its generous assistance to the Philippines through the years” and welcomed its offer of aid for Marawi City.
A Complicated Situation
Dominguez emphasized the need for World Bank’s technical advice and expertise in reconstructing the entire city of Marawi as the Philippines has very limited experience in handling a rehabilitation program of this magnitude..
“The rehabilitation of Marawi is a complicated situation,” said Dominguez, noting as an example the issue involving land titling for its returning residents, many of whom are informal settlers living in multi-storey structures.
“The World Bank has the experience in reconstruction. We want to rebuild the entire city and keep a part of it as a memorial,” Dominguez said.
Dominguez informed Georgieva that with the approval of President Duterte, the government has opted to raise funds “domestically” for Marawi’s recovery, rehabilitation and reconstruction program by, among others, improving investor confidence and issuing bonds.
“I would like to introduce the concept that the rest of the country is involved in Marawi, that we have to contribute ourselves to the reconstruction and we are going with the bond issue,” said Dominguez.
Georgieva said that the Philippine government and the World Bank “need to work together” even as she cited the strength and resilience of Filipinos in dealing with conflict and tragedies.