One of the pillars of President Arroyo’s foreign policy is the influential role played by the US, China and Japan in the overall platform of world peace and prosperity.

The stepping stones have already been laid for us to move out of the fiscal crisis.

Positive economic indicators are steady, investments are up, tourism is growing, and we are making gains in fighting corruption, cutting waste in government and mustering new revenues through a strong executive-legislative partnership.

Street crimes are at an all time low, terrorists are on the run, drug syndicates are being scuttled and we anticipate a lasting peace in Mindanao.

Things are looking up and the room for optimism and hope is getting larger.

Malacanang today said that when President Gloria Macapagal-Arroyo declared in August that the country faced a looming fiscal crisis, the government was in a tight financial fix, while proposals to raise taxes, as well as generate savings through stringent and sustainable cost-cutting prescriptions, were getting nowhere.

In a radio interview this morning, Budget Secretary Emilia Boncodin explained that at the time the President disclosed the country’s grim fiscal position, the "national government was really financially strapped."

To top it all, Malacanang’s proposal to increase taxes and reduce operational expenses was still "unappreciated," especially by the GOCCs, she added.

Boncodin said the fiscal crisis declaration somehow galvanized the people, both in the government and private sectors, behind the President’s efforts to avert the feared crisis.

People now have a better appreciation and understanding of the need for increased tax collections and the austerity measures imposed by Malacanang on government operations, she said.

Boncodin noted that while the President’s declaration initially raised concern that the worse in the government’s fiscal position is yet to come, people now tend to agree that Malacanang is serious in implementing reforms in the administration and management of public finances, with an eye fixed on cutting cost.

ILOILO CITY -- President Gloria Macapagal-Arroyo said today that the main challenge now as the country struggles to get out of the fiscal problem is the fight against poverty and how to grow the economy.

In her speech at the inauguration and dedication of the 7^th SOS Children’s Village in Zarraga town here this morning, the President said that to fight poverty and grow the economy, the country must eliminate government wastes, stop corruption, increase tax collection, and invest in our nation through revenue increases dedicated to job creation, education and health care.

"I talk about corruption, and I think the root cause of our situation today is a pestering entrenched culture of corruption," she said. "Like a cancer, it must be cut out if the patient is to survive."

The President said the nation will grow and prosper tomorrow because of the tough decisions that the Filipino people will make today.

"As we raise new taxes, we need to be assured that the rich pay their fair share. People who owe their taxes, need to pay their taxes. The era of dodging our obligation to the nation is over," the President stressed.

The government and Congress, she noted, will make sure that those tax avoiders, not only tax evaders, would pay their taxes and meet their obligation to the nation.

The government, she assured, is also increasing the efficiency of its collection and modernizing its technology to collect more taxes.

"The people deserve to know that their tax money is well spent," the Chief Executive said. "That any new tax goes to real project or help the people in education, job creation and health care. All new taxes will be earmarked for funds and will go straight to dedicated projects for the people."

The President expressed the need for new revenues to build up the nation and to get the economy on solid footing.

ZARRAGA, ILOILO—President Gloria Macapagal-Arroyo today stressed the need to reduce the country’s obligations and instead increase its capacity to pay debts, saying that when she said two months ago that the Philippines was facing a fiscal crisis it meant that "we were facing a critical constraint in the capacity of the government to meet its obligations."

The President issued the call this morning at the inauguration and dedication of the 7^th SOS Children’s Village in the Philippines here.

"If every time you spend more than you earn, what is the difference? Debt. So, the debt has accumulated to what we now consider an alarmingly high proportion of the country’s output as measured by the gross domestic product (GDP)," the President said.

The President said unless something is done to address the problem, the debts will accumulate over time and the government could no longer afford to subsist on borrowed funds.

"If we persist in sustaining national growth through relentless borrowing, whether from foreign and domestic creditors, whether from official development assistance (ODA) or from the bond market, the budget will just end up going to debt servicing and interest payments," the President said.

"And if this happens, public services and social reforms, as we know them, would slow down or come to a full stop," she added.

Budget Secretary Emilia Boncodin said the President’s fiscal crisis declaration somehow galvanized the people, both in the government and private sectors, behind her efforts to avert the feared crisis.

Boncodin explained that people now have a better appreciation and understanding of the need for increased tax collections and the austerity measures imposed by Malacanang on government operations.

She added that this public acceptance of the President’s sincerity in pushing her reform programs has generated support in Congress for her priority revenue measures

In passing some of the tax measures she proposed, the President thanked members of the House of Representatives for responding to her alarm bell.

ALIMODIAN, Iloilo—President Gloria Macapagal-Arroyo today inaugurated the newly constructed P42.263 million Nichols Bridge under the Tulay ng Pangulo sa Barangay that is expected to stir economic activities in this municipality and its neighboring towns.

According to the President, the Nichols Bridge would benefit the residents of 51 barangays, covering a total land area of 14,482 hectares, 60 percent of these classified as upland.

The new infrastructure project is a project of the Department of Public Works and Highways (DPWH), with assistance from Mabey & Johnson, Limited of the United Kingdom.

Iloilo Governor Niel Tupas, Sr., Alimodian Mayor Juanito Alipao, Vice Mayor Jeffrey Alonsabi, Technical Education Skills Development Authority (TESDA) Director General Augusto Syjuco and DPWH Secretary Florante Soriquez assisted President Arroyo in the ceremonial unveiling of the Bridge’s marker.

The bridge also links the Province of Antique, via the municipalities of San Remigio, Leon, Alimodian, Cabatuan and Sta. Barbara to the proposed airport of international standards to be constructed in the towns of Cabatuan and Sta. Barbara.

Nichols Bridge now provides easy access to Agony Hill, a top tourist attraction of the province during Lenten Season.

LEON, Iloilo—Determined in pushing the government’s peace efforts, President Gloria Macapagal-Arroyo today made an unprecedented visit to an area frequented before by insurgents in line with the implementation of development projects under the 2000 GRP-RPA peace agreement.

The President handed over a check amounting to P400,000 to the community leaders in the area once held by the Revolutionaryo Proletarian Army (RPA ) to fund the fill and draw process that will pump potable water to Barangay Salngan, considered as the poorest sitio in the province of Iloilo.

"This is the check worth P400,000 that will help you in having clean drinking water as part of my 10-point legacy program of providing clean water and sufficient power to waterless and powerless barangays in and outside Metro Manila," said the President as she handed the check to Barangay Kagawad Ruperto Cangas as the community’s chairman of the committee on potable water.

Cangas told the President that with the support of the government to their community, he is quite sure that residents of their barangay will never again be visited by insurgents who, he said, frequented their area before.

The financial assistance comes from the Potable Water Systems Fund of the Department of Social Welfare and Development (DSWD).

The President’s plan to visit the area was made right after the National Anti-Poverty Commission (NAPC)-Cabinet meeting in Malacanang last Tuesday after the barangay was identified as one of the priority areas for her Patubig program.

Upon her arrival here, President Arroyo immediately inspected the ongoing microfinance project with a total funding of P300,000.

She urged residents of Barangay Salngan to concentrate their livelihood program in cattle raising.