Forums on ways to deal with the rising peso

Dubai Philippine monetary authorities will hold forums to educate Filipino expatriates on how to ease the effects of the Philippine peso's rapid appreciation on their finances.

A senior finance ministry official who is here as part of Philippine President Gloria Macapagal Arroyo's entourage told XPRESS they will hold an information drive throughout the Philippines within the first quarter, with presentations from banks offering hedging facilities and testimonies from exporters who have benefited from such programs.

A similar drive is also being planned in countries with major concentration of overseas Filipino workers (OFWs).

“The UAE being the second top destination of Filipino expatriates in the Middle East will surely be targeted in our planned information campaign,'' the finance ministry official said.

Exporters and overseas Filipino workers (OFWs) have been complaining of the rapid rise of the Philippine peso and are demanding special treatment such as subsidised currency exchange rates.

The peso appreciated by about 18 per cent last year, the official said.

Hedging is a financial tool designed to minimise one's exposure to unwanted business risks while still allowing profit from an investment activity. Some of the most common currency hedging tools offered by banks are forward contracts, options, and swaps.

President Arroyo, in her speech before Filipino community leaders on Sunday night, officially launched the hedging facility of the state-owned Development Bank of the Philippines.

“To cushion the impact on the strength of the peso, our Administration is addressing the weak dollar very aggressively… We are hereby officially launching this hedging facility today,'' Arroyo said.