The falling Peso to the dollar is something abnormal to observe, as it has already breach the level of P51 to the dollar can be seen as hard to recover in the future, as indicators to avert the rate to its former before the entry of the new administration that was only P44, have not improved.
The P5 increment is difficult to retake to put the peso in its former rate before the election.
The rise of the dollar is a sign that we have grown in imports that had put pressure on the Peso, while if the situation is reversed, of greater exports than imports the dollar will fall.
But due to the fact that we are not robust in exports, the situation will not return to the old rate prior the entry of the new administration.
The ill effects of the higher dollar rate is our ability to comply obligations with our foreign loans, that instead of savings and reduction of debt servicing, we end up paying more of the value of the loans more than we had expected.
Complemented by the administration's new programs of free tuition fees, higher pension rates, free government hospitals, among others cannot meet the financial ability of the government to fulfill such new orders. Thus, the increasing dollar may affect the financial capability of the government to settle its foreign obligations and services to the people.
Taxing more is not an option, as it will only injure the tax paying masses and will not give proportion for our GDP.
Manufacturing and Exports
Manufacturing and Exports are areas in our economy that was neglected by the government for many years. The increased importation is a reflection that manufacturing is low in the country, and there are so many products and items that we do not produce for counter trade. We should increase exports massively to provide employment and reduce the dollar increase, thereby reducing inflation of the country.
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