Oct 242014


Reference ID Created Released Classification Origin
05MANILA3413 2005-07-26 07:42 2011-08-30 01:44 CONFIDENTIAL Embassy Manila
This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 02 MANILA 003413



E.O. 12958: DECL: 07/26/2015


¶C. MANILA 3391
¶D. MANILA 3367

Classified By: Political Officer Timothy Cipullo for
Reasons 1.4 (b) and (d).

¶1. (C) Summary: President Arroyo’s July 25 State of the
Nation Address (SONA) netted positive coverage in the media.
Political reaction generally fell along predictable lines,
with supporters asserting that it was an excellent speech,
while the opposition castigated it. On the economic side,
reaction was mixed, with contacts demanding that she follow
up on her promises. Overall, Arroyo possibly gained a small
degree of momentum ahead of the House’s review of the
Opposition’s impeachment complaint, but there is little sign
that she really changed the political equation in her favor.
End Summary.

Positive Media Reaction

¶2. (U) Media coverage of President Arroyo’s SONA was largely
upbeat. (Note: See refs a-b for a review of the speech and
its full text. End Note.) Manila newspapers contained large
photos of Arroyo delivering the speech in the House of
Representatives and reported that she was interrupted by “34
rounds of applause.” Articles also placed a spotlight on the
bid to impeach the president and the fact that it failed to
gather enough signatories to gain immediate referral to the
Senate when it was filed on July 25 (refs a and c). Media
analysis of the speech, however, was more evenhanded; radio
talk shows seriously questioned the utility of President
Arroyo’s proposal for Constitutional changes, for example.
Despite the positive front-page headlines, several columnists
asserted that the SONA was extremely brief (in fact, the
shortest on record) and seemed to lack substance. As one
columnist, Max Soliven of the centrist “Philippine Star,”
wrote: “Yesterday’s SONA didn’t measure up to a ‘forward
march’ address, but represented La Gloria (i.e., Arroyo)
digging in her heels and claiming a ‘glorious’ status quo. A
status quo is not enough.”

Predictable Political Reaction

¶3. (C) Political reaction generally fell along predictable
lines, with Arroyo’s supporters asserting that it was an
excellent speech, while the opposition castigated it.
Malacanang Secretary for Political Affairs Gabriel “Gabby”
Claudio, noting the many interruptions for applause the
speech engendered, stated, “Judging from the way the audience
reacted, I think it was a very appropriate speech and fitting
tribute to the legislators, the local government officials
and to all other Filipinos who are looking forward to the
reforms that will bring about progress to the country.”
House Speaker Jose De Venecia, a close ally of the
President’s, welcomed Arroyo’s plan to work toward
implementing a parliamentary system of government as a
“dramatic and historic change.” Other House representatives
that Mission touched base with praised the speech and said
that the House would immediately begin work on Constitutional
changes. In a conversation with Acting POL/C, Congressman
Anthony Miranda, an Administration supporter, emphatically
praised the speech, claiming that Arroyo had shown herself to
be “a strong leader.”

¶4. (U) However, some Arroyo allies were less than impressed
with her calls for changing the Constitution.
Pro-Administration senators Miriam Defensor-Santiago, Pia
Cayetano, and Manuel “Mar” Roxas II argued that Arroyo should
deal with other issues before tackling the issue of possible
Constitutional changes. Roxas told the press on July 25,
“The Constitution is not the problem. It did not cause this
political crisis.” (Note: Many senators of all political
stripes are unhappy with the proposals to change the current
bicameral system to a unicameral legislature given that the
Senate would be abolished.)

¶5. (C) The Opposition, not surprisingly, was quick to attack
the President’s speech, sometimes in harsh terms. In a July
26 conversation with Poloff, Lito Banayo, a political adviser
to Opposition Senator Panfilo Lacson, characterized Arroyo’s
speech as a “tactical move” designed to pander to Congress to
dissuade its members from acting on the recently-introduced
impeachment complaint (ref c). Senate Minority Leader
Aquilano Pimentel Jr. echoed these sentiments and went on to
label the speech “a pack of lies and half-truths to buy her
time.” Others criticized the speech for what they felt was
its brevity and lack of detail. Archbishop Oscar Cruz, a
Catholic prelate with close Opposition links, said Arroyo’s
speech was no different than previous SONAs, which he said
were full of “failed promises.”
Economic Side: Wait and See

¶6. (C) Early business community reaction to the address was
mixed, but few business leaders gave Arroyo very high marks.
Philippine Chamber of Commerce and Industry President Donald
Dee, who has supported Arroyo throughout the recent political
turbulence, gave the President credit for saying “what we (in
business) wanted to hear: that she would focus on the economy
and that she would allow political reforms to take place.”
Leaders in the Chinese-Filipino business community told us
they strongly support Arroyo and want to see her implement
more reforms. Many Filipinos are eager to move beyond this
period of turbulence as it works against business interests.
Other business leaders, however, were less enthused. Makati
Business Club Executive Director Bill Luz, who has called for
Arroyo’s resignation, said, “I am disappointed with the
President’s address. She skirted the leadership issues.”
Many, including foreign investors, expressed some
disappointment, but concurred that she accomplished the
short-term goal of promising enough to maintain the immediate
economic calm by focusing on the accomplishment of the three
fiscal reform initiatives Congress passed last year (the
amended VAT law, the amended “Sin” Tax, and the lateral
attrition law). The local stock and currency markets seemed
to reflect that assessment, opening July 26 basically
unchanged and trading slightly up at mid-day.


¶7. (C) Overall, Arroyo probably gained a small degree of
momentum via the speech. Most neutral observers seem to
agree that the speech was a bit short and not extremely
impressive in content. However, during what has been a very
difficult timeframe for her, it was a political boon for
Arroyo to be able to present herself as the leader of the
country standing before a giant Filipino flag. None of her
opponents can present such an image and she took full
advantage of the trappings of office. Despite the positive
visuals, there is little sign that she really changed the
political equation in her favor. In any case, she will need
whatever traction she has picked up in the next several weeks
and months as the House reviews the Opposition’s impeachment

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