Thank you for your invitation today.

     It is an honor for me to be with men and women of distinction and privilege who serve as consuls of our friends in the family of nations.

     I am indeed honored and delighted to be in this gathering of special friends.

     You all know I just assumed the position of Secretary of Foreign Affairs.

     Until this new appointment, I was the President’s Executive Secretary, a position I occupied for three years, two months and 15 days. According to the President, I am the longest servicing in that position.

     When I finally took my oath as Foreign Secretary, my daughter Lupe gave this perspective.

     As Executive Secretary in Malacañang, she said, I was a big fish in a tiny pond. As Secretary of Foreign Affairs I am a small fish in a big pond.

     The President had another perspective. From a domestic helper, she said, I am now an OFW.

     About three weeks ago, I joined the President for the ASEM meeting in Hanoi. This was my first trip with the President to attend a world summit.

     Gathered in Vietnam’s capital were the leaders of 38 countries of Europe and Asia – Europe’s 25 EU nations and ASEAN’s 10 countries plus China, Japan and Korea.

     From opening bell, President Arroyo took center stage, flanked by Europe’s top leaders – France’s Jacques Chirac and Germany’s Gerhard Schroeder.

    Seeing the President standing between these two physical giants, I remembered CPR’s quip[ as he stood between two Texan six footers – I feel, he said, like a dime among nickels.

    In the ASEM sessions that followed the next two days, the President was in top form – incisive and brilliant – with her interventions on the issues facing ASEM, including how to forge closer economic partnership between ASEAN and the European Union, as well as the need for interfaith dialogue and cooperation with non ASEM countries within the UN system.

     The President’s performance was scintillating.

     At the end of the President’s interventions, no less than President Jacques Chirac led the applause each time clapping and saying “Bravo, bravo, bravo.”

     At the final gala dinner and state banquet, as a sign of their admiration and respect, President Arroyo was accorded the seat of honor by the hosts – between the President and the Prime Minister of Vietnam. The other 37 heads of state and government took their respective seats spread around the semi-circular table.

    As a Filipino and her foreign secretary, I was impressed, and felt ten feet tall and immensely proud of our President and her performance on that world stage of 38 leaders of Europe and Asia.

     No President would like to begin her term by saying that the nation is in a crisis. Fresh from an electoral victory, the President was candid and forthright enough to say just that.

     Some thought the President was just being melodramatic or manipulative by painting a grim scenario. But figures do not lie. The widening chasm between revenues and expenditures provokes serious concern over our ability to sustain growth through borrowings.

     If we continue to borrow to pay for government projects and services, our debt interest payments alone would eat up the national budget. When that happens, where do we get the revenues to help the poor? Where will we get the money to build the infrastructure, improve the educational system and sustain the programs to promote growth and poverty reduction? The President was not exaggerating when she declared a fiscal crisis. But her declaration carried with it a fiscal roadmap and Medium-Term Development Plan that would help to beat the odds.

     The fiscal roadmap calls for the adoption of revenue-generating measures through a combination of executive and legislative measures. The entire bureaucracy was placed under austerity program banning unnecessary travel, trainings and sports festivals, hiring of new people and prescribes a forced reduction by at least 10% in fuel, electricity and other utilities. With a budget of less than 1% of the total government appropriations, we at the DFA have long been in a strait jacket.

     From the government’s austerity measures, we expect to save considerable amount. From new taxes, we expect additional revenues even as our two collection agencies, the BIR and BOC, work hard to meet their targets and even exceed them.

     As part of the over-all effort to prune expenditures, our economic managers prescribe the following: 1) austerity programs; 2) rationalization of Personal Services; 3) improvement of the management of GOCCs; 4) full implementation of devolution provision of the Local Government Code; 5) increase in social safety program within the budget; and 6) transfer to the General Fund of all balances of dormant accounts.

     Congress has assured the President and our people that at least three tax measures will be enacted into law before Christmas. This is crucial to the credit ratings our country will receive which will in turn affect investors’ confidence in the Philippines.

     The fiscal roadmap presented by our economic team and approved by the President also calls for the implementation of a debt reduction plan, focusing on: 1) lengthening debt maturities; 2) making use of more ODA over commercial borrowings; 3) limiting guarantees to GOCCs; 4) implementation of a debt limit; and, 5) limiting borrowings to high priority projects.

     These strategies to impose fiscal discipline, increase revenues and better debt management will take its political toll. Indeed, it takes a strong leader to take on such reforms as her administration begins to take off.

     Our economic fundamentals, however, are getting stronger. GDP grew by 6.3% this semester, up from 4.5% in the same semester last year. GNP increased to 6.1% from last year’s 5.6%. Tourism arrivals rose 28% compared to the same period last year.

     Foreign direct investments increased by more than 800% from the same period last year. The stock market rebounded to its highest level since 2000 and interest in Napocor privatization is sparking business confidence.

     We have reduced crime by half. The war against corruption continues unabated with lifestyle checks becoming a fact of life in government. President Arroyo has ordered the AFP to court-martial Major General Carlos Garcia and any other military official and government officials with hidden, unexplained wealth.

     As our President calls for austerity and sacrifice, she said: “The price for me will be steep, and I anticipate a slump in my ratings as we suffer transient constraints and take the bitter pill to cure structural poverty and clean up the mess we inherited. I am prepared to suffer the consequences of unpopular decisions . . .”

     As Secretary of Foreign Affairs, I call on you, our honorary consuls and believers in our country, to help overcome these challenges and difficulties.

     You can start by explaining to your friends here and abroad the government’s relentless efforts to put its house in order and move towards fiscal discipline and responsible governance.

     While we tighten belts and prepare for more sacrifices, the administration has also put together a 10-point agenda to help reduce poverty and improve our economy.

     To help you remember our national agenda for growth and poverty reduction, remember the acronym: Beat the Odds.

     B – for balanced budget. E – education for all. A – automated elections. T – for transport and digital infrastructure to link our islands.

     Now, for the T-H-E,  T – is terminating NPA and MILF hostilities. H  - is heal the wounds of EDSA. E – electricity and water for all barangays.

     Finally, O-D-DS.  O – stands for opportunities to create six to ten million jobs. D – is decongest Metro Manila through decentralization of government agencies and new transport infrastructure systems. DS – is for develop Subic-Clark as a globally competitive logistic hub in partnership with the private sector.

     There you have it: BEAT THE ODDS.  This is the President’s battle cry and our collective agenda for growth.

     I invite each of you to play a role in promoting the President’s ten-point growth agenda. Only through collective political will can we help this nation weather the storm caused by decades of complacency, incompetence and corruption.

     As the President said, “It is far better to face the truth and suffer the pain now than to have it imposed on us two to three years henceforth.”

     My friends, we are counting on you to do your share to beat the odds and make our nation move forward.

     You may represent the nationals and flags of other nations in your position as honorary consuls. But I know that for each of you in your heart, there is only one flag, one nation and one people – our own. Thank you.   END.