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Philippines' Estrada moves to defuse critics

MANILA: Philippine President Joseph Estrada announced significant policy changes on Saturday, including dropping a divisive proposal to amend the constitution and naming top businessmen as advisers on the economy.

The moves were clearly aimed at rebutting perceptions of inefficiency, cronyism and corruption which have sent Estrada's popularity plummeting, analysts said, adding that the country's political risk profile would improve as a result.

In a nation-wide address broadcast on radio and television, Estrada also announced expected changes in the cabinet and named new officers to head the departments of customs and tax to boost government revenues.

Trade Secretary Jose Pardo will be the new finance secretary, replacing Edgardo Espiritu, who resigned on Wednesday, Estrada said. Congressman Manuel Roxas will take Pardo's post at trade and former Manila mayor Alfredo Lim will be the new secretary for the interior.

"For me, politics is over," Estrada said. "What is in my mind and heart right now is to uplift the lives of our people."

PARADIGM SHIFT

He said he was sacking scores of advisers who had no regular functions and ordered them to destroy calling cards and stationery which described them as attached to the presidency.

"I read that to mean that the period for repaying his debt to campaign contributors is done," said independent political analyst Alex Magno. "It is a paradigm shift under the duress of public opinion surveys."

Estrada, a former movie star, was elected president 18 months ago with the highest majority ever in a free Philippine election. But his popularity has dived in the past six months under the weight of the constitutional reform proposals and increasing disquiet about cronyism and inept administration.

Estrada also announced the formation of a high-powered committee, called the Economic Coordinating Council (ECC), to oversee all economic policy and named five top businessmen as senior advisers.

He will chair the ECC with Pardo as deputy. It would also include the central bank governor and four other cabinet members.

"The mainstream business community, as against the cronies, will have a very clear voice in policy," said Magno.

"It is a decision that will be welcomed by many," said Joe Concepcion, a director of the Philippine Chamber of Commerce and Industry. "If we maintain the drifting along policy then investors, domestic and international, will hesitate."

SURPRISING DECISION ON CONSTITUTIONAL REFORM

The cabinet changes and some moves to revive the economy were on the cards but the announcement putting constitutional reforms on hold came as a surprise.

Estrada has spent much energy in recent months to back the proposals, which he has said will remove restrictions on foreign investment in critical sectors, including infrastructure.

Critics have mounted a fierce campaign against the reforms, saying they could be used to scrap a one-term cap on the president's time in office. Estrada has denied any such motive, but his popularity has dropped amid the debate.

"My passion for seeing these amendments through has not cooled but it...must for the moment yield to more urgent, more short-term and more feasible concerns, to efforts that are more likely to produce results in less time and at less cost to national unity," Estrada said.

"But it does not mean that the need for repairing the constitution has passed, it only means that it needs more gestation. The constitution must be discussed, not fought about.

"Nevertheless, in response to clear signals from the people, my government is re-directing its efforts at getting urgent legislation passed and urgent executive programmes implemented."

Magno called it "a graceful capitulation" which would remove many tensions from the political arena.

"It shows that the president is listening and I would view that in a positive light because...obviously there are more pressing concerns that have to be addressed," said Helen Alvarez, head of research for All Asia Capital and Trust Co.

"I think it is just sensible of him to have put that (the constitutional reform) on the side for the meantime."-Reuters