PHILIPPINES - In reality, we have yet to see our government pursue a policy of promoting LGU-bond financing. For the reasons described above, there should be. A basic requirement is that the tax exemptions commonly given elsewhere be also granted on LGU bond earnings here. It also requires that there be a good credit rating system for LGUs, and a good LGU credit guarantee mechanism in place. Both are already being partly fulfilled by the LGU Guarantee Corporation, but needs further expansion to widen its scope and coverage. And for LGU bonds to be instrumental in deepening our capital markets, we need to have a well-working fixed income exchange—i.e., the counterpart of a stock market for trading fixed-income assets like bonds. Some baby steps have been made in these directions in the past years, but it’s time to make greater strides so that through better local resource mobilization, we can help fill our glaring infrastructure gap both at national and local levels. opinion.inquirer.net/80596/the-promise-of-lgu-bonds
Posted on: Tue, 02 Dec 2014 06:31:26 +0000