New Philippine leader Duterte sets out growth focus in first big speech

[MANILA] Philippine President Rodrigo Duterte promised to keep the economic policies of his predecessor "and even do better," outlining policies he said would boost growth and create jobs to lift people out of poverty.

The former mayor, who took office June 30, vowed Monday in his first state of the nation address to relax economic restrictions and make it easier to do business, in a bid to attract more foreign investment. Duterte pledged to lower personal and corporate income taxes and relax rules protecting the secrecy of bank deposits.

"By the end of my term I hope and pray to hand over an economy that is much stronger characterised by solid growth, low and stable inflation and dollar reserves, and a robust fiscal position," he said.

The Philippine Stock Exchange Index rose 0.3 per cent at the close of trading in Manila before the president's speech. The gauge has jumped 12 per cent since Mr Duterte declared victory on May 10, standing just shy of a record.

For an explainer on the Philippines under the new president, click here The new leader inherits an economy that grew faster than China in the first quarter and won its first investment-grade credit rating under former President Benigno Aquino. His administration has forecast growth of 6 per cent to 7 per cent this year even as the country faces its fair share of headwinds, with one in four Filipinos living in poverty.

Mr Duterte, 71 said Monday he would accelerate infrastructure spending, build more access roads to tourism gateways and provide inter-island transport links. He asked Congress to give him emergency powers to try and solve the capital's traffic problems, and said his government would make sure the poor in the majority Roman Catholic nation are provided with free contraceptives as required under an ignored law.

Mr Duterte spelled out "a wide gamut of political and economic initiatives that will let the new government put on the fast lane its 10-point socioeconomic agenda for genuinely inclusive growth," Finance Secretary Carlos Dominguez said afterward.

'SINS OF THE PAST'

Mr Duterte started his address by promising not to "waste precious time dwelling on the sins of the past or blaming those who are perceived to be responsible for the mess that we are in and suffering from." Aquino often used his congressional addresses to blame past administrations for the nation's woes.

The former Davao City mayor pledged to continue his campaign against illegal drugs and corruption.

"There will be no let-up in this campaign," he said. "We will not stop until the last drug lord, the last financier and the last pusher have surrendered or are put behind behind bars or below the ground if they so wish."

The president announced an immediate unilateral cease-fire with Maoist rebels fighting one of Asia's longest insurgencies and urged the rebels to respond accordingly.

He asked Congress to pass a law giving more autonomy to predominantly Muslim regions, without what he called the "unconstitutional" provisions of the bill crafted by the Aquino administration.

Mr Duterte briefly touched on his nation's maritime disputes with China and a recent international tribunal ruling that rejected China's claim to exclusive rights to the South China Sea.

He pledged to "deepen security dialogue with other nations to build greater understanding and cooperation." "We strongly affirm and respect the outcome of the case before the Permanent Court of Arbitration as an important contribution to the ongoing efforts to pursue a peaceful resolution and management of our disputes," he said.

'IRREPARABLE HARM'

The court ruled July 12 that China's land reclamation and other efforts to assert control over the South China Sea had "aggravated" tensions, "inflicted irreparable harm" to the environment and "violated" Philippine sovereign rights. China has rejected the ruling.

Mr Duterte's first congressional address was a no-frills affair where legislators and guests were told to come in simple native or business dress. His populist style was reflected in a July 15 memo banning the use of honorifics like "honorable" or "your excellency" for himself and his cabinet.

There were no dramatisations and testimonials during Mr Duterte's speech, a feature of past presidential addresses.

He spoke for 90 minutes, longer than the expected 40 minutes and veering from his prepared speech several times. In his candid style he told the audience that except for less than a handful of lawmakers, none of them had supported him until now.

BLOOMBERG