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PASTOR GENERAL'S REPORT, FEBRUARY 28, 1986
happens now in the Philippine countryside, where the Marcos party, the
KBL, has dominated political and economic life in a feudalistic manner?
Will the KBL crumble, will powerful landlords, estate owners, employers of
thousands of people in industry and agriculture, switch sides? No one
knows yet whether turmoil can be avoided.
It was in the big cities, where individuals were freer to choose their
political allegiance, that Mr. Marcos lost his grip on power. Charges--no
doubt true to a considerable extent--of corruption, greed and the use of
political office (or personal enrichment freely circulated and undermined
the KBL's position. "A throne is established by righteousness," we are
told in Proverbs 16: 12, and the KBL simply could stand no longer. The
powerful interests and families dominating the old order have been
toppled • .
But it must be admitted there are other interests, other groups
who were out of power and who now have their chance to wield it. Will
they succumb to the same temptations? Will conditions really change that
much for the average Filipino?
Meanwhile, we must continue to pray for the safety and well-being of our
brethren in the Philippines.
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il Price Plunge Triggers Economic Woes The plummeting world oil price
structure claimed, in effect, its first significant victim on Friday,
February 21. On that day Mexico's president Miguel de la Madrid said his
oil-producing, debt-ridden country intends to limit its debt repayments to
its "capacity to pay." Foreign creditors--meaning, in large part, giant
U.S. banks such as Bank of America, Chase Manhattan, Citicorp and
Manufacturer's Hanover--will simply have to make "sacrifices," he said.
While President de la Madrid left many points unclear, he implied that
Mexico has decided not to pay the full interest bill on its $97 billion
foreign debt, at least not on time. Mexico's new policy differs only in
spirit from one that Peruvian Presi.dent Alan Garcia announced last July
limiting the country's debt-service payments to 10 percent of its export
revenue.
Nigeria, too, has taken a similar step.
Significantly, the
February 24 WALL STREET JOURNAL labeled the Mexican action "a major
turning point in the international debt crisis."
Latin American experts had predicted earlier that Mexico faced financial
ruin and the potential of social upheaval threatening the existence of the
ruling Institutional Revolutionary Party (PRI) if oil prices plunged down
to the $20-per-barrel range. But now Mexico is selling its oil at the
approximate $15-per-barrel level, and in smaller quantities than pre
viously.
As a result, the big U.S. banks are shuddering at what lies
ahead. A private newsletter we receive (I can't divulge the source) says
this about their concerns:
The petrodollar recycling machinery set up between OPEC oil
producers, the big banks and Third World borrowers in the 1970s
is now coming apart at the seams. The declining U.S. dollar,
lower price of oil, and lower U.S. interest rates [have]
reversed the flow of OPEC funds away from the big u.S. banks
over the past year or so. U.S. banks have loaned domestic oil
companies $27 billion and have loaned just three foreign oil
producers (i.e., Mexico, Venezuela, and Nigeria) $40 billion.
Bank of America (America's second largest bank) is in trouble,
with 98 percent of its total eguity loaned out to Mexico and