Philippines to acquire helicopters, trucks in bid to modernize military

The Philippine's defense chief says the government has signed separate contracts worth 163 billion pesos (about $39 million) with Italian and South Korean companies to supply helicopters and trucks as part of efforts to modernize its poorly equipped military.

Defense Secretary Voltaire Gazmin said Thursday the Philippines will purchase three multi-purpose AW 109 helicopters for its navy from AugustaWestland SPA of Italy amounting to 1.33 billion pesos ($32 million).

He says Kia Motors Corp. will supply 60 field ambulances and 12 trucks all worth 300.78 million ($7.33 million) pesos.

Gazmin says the purchases show the country's "louder and clearer" intent to modernize its military.

The Philippine military is fighting a decades-long communist insurgency and battling Islamic militants while facing increasing tension over territorial disputes with China in the West Philippines Sea (South China Sea).

Posted in Washington Post, Copyright 2012 The Associated Press (http://is.gd/fY9RJY)

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CPP-NPA Rebels Call for Peace & Unity with Philippine Government - for a Cabinet post

Philippine rebels call for Aquino 'alliance'

Communist rebels said Thursday they have called for an "alliance" with Philippine President Benigno Aquino to undertake programmes aimed at ending a long insurgency that has killed tens of thousands.

There was no immediate official reaction to the reported offer, which chief rebel negotiator Luis Jalandoni said was made during "special track" talks in the Dutch city of The Hague on Monday and Tuesday.

"The 'special track' means the offer of alliance and truce offered by the National Democratic Front of the Philippines to the government of the Philippines," the exiled rebel told reporters in a statement.

Both sides would form a "Committee of National Unity, Peace and Development" to implement agrarian reform, rural development and national industrialization, he added.

"On the basis of the above-mentioned points, a truce would be declared and implemented," Jalandoni said.

The National Democratic Front is a communist-led rebel coalition.

Teresita Deles, who advises Aquino on peace talks, told AFP she could not immediately comment on the supposed offer. Chief government negotiator Alexander Padilla was unavailable for comment.

Padilla had told AFP last year that the Philippine government had rejected the rebels' offer in 2005 of a "coalition" government.

Last year Manila also denied local press reports it was considering offering cabinet posts to rebel leaders including their exiled founder, Jose Maria Sison.

Jalandoni and Sison met Padilla in The Hague this week and agreed to a 26-day nationwide truce from December 21 and another meeting early next year, said a statement by Norway, which mediated the meeting.

Both the military and the communist party's guerrilla arm, the New People's Army, have declared a separate shorter ceasefire over Christmas.

The communists have been waging a rebellion since 1969 and more than 30,000 people have died in the conflict, according to the government. (http://is.gd/jqz6rD)

MSN News

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Philippine Bonds Gain after S&P Revises BB+ Outlook; Peso Declines

Philippine government bonds maturing in 2037 rose for a second day on speculation the nation will win an investment-grade rating next year after Standard & Poor's raised the credit outlook to positive. The peso dropped.

S&P, which ranks the Philippines BB+, the highest junk level, cited improved governance and public finances for the revision as official data showed Dec. 19 that tax revenue climbed to a record. President Benigno Aquino signed a law yesterday that will raise excise duty on cigarettes and alcohol, which Finance Secretary Cesar Purisima said will generate an additional 34 billion pesos ($826 million) in 2013.

"We had pretty good news yesterday with S&P's upgrade from neutral to positive," said Jill Singian, a bond portfolio manager at Bank of the Philippine Islands (BPI) in Manila. "It's giving a lot of support to buying interest but players will not make a bold move today. We are going into a long weekend."

The yield on the 6.125 percent notes due October 2037 declined two basis points, or 0.02 percentage point, to 5.64 percent as of 10:09 a.m. in Manila, according to prices from Tradition Financial Services. The rate advanced two basis points this week and has dropped 28 basis points since the securities were issued in October.

Local financial markets will be closed on Monday and Tuesday for the Christmas holidays.

The peso weakened 0.2 percent to 41.145 per dollar in Manila and declined 0.1 percent for the week, according to Tullett Prebon Plc. It appreciated 6.6 percent this year, the second-best performance among Asian currencies after the South Korean won.

Bangko Sentral ng Pilipinas will announce measures next week to manage capital inflows, Deputy Governor Nestor Espenilla told reporters in Manila late yesterday.

One-month implied volatility, a measure of expected moves in the exchange rate used to price options, was unchanged at 4.4 percent today and this week. It fell 335 basis points this year. (http://is.gd/Ue9eZd)

Bloomberg

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