BSP joins economic team at Philippine dialogue in Washington

The Bangko Sentral ng Pilipinas (BSP) has kept the appropriate monetary policy stance to maintain price stability and ensure that inflation will be on a target-consistent path, this was underscored by BSP Deputy Governor Francisco G. Dakila Jr. during the Philippine Dialogue in Washington, D.C. on 17 April 2024.

He said inflation in March 2024 rose to 3.7 percent from 3.4 percent a month earlier, bringing the year-to-date inflation rate to 3.3 percent. “This is within the government’s target range of 2.0 to 4.0 percent.”

At its meeting on 8 April 2024, the Monetary Board, the BSP’s highest policymaking body, kept the policy rate at 6.5 percent to help temper inflation. “The MB will look for a situation where inflation is comfortably on a path consistent with target before it would [consider] an adjustment,” Deputy Governor Dakila explained.

He also highlighted the country’s robust external sector, which was supported by overseas Filipino remittances, a strong business process outsourcing sector, and ample foreign exchange reserves.

The Deputy Governor joined Department of Finance (DOF) Secretary and MB Member Ralph G. Recto, Department of Budget and Management (DBM) Secretary Amenah F. Pangandaman, and National Economic and Development Authority (NEDA) Secretary Arsenio M. Balisacan in engaging around 90 participants from corporations, financial institutions, and development partners.

DOF Secretary Recto said, “The Philippine central bank has remained vigilant in ensuring that inflation expectations are well anchored through monetary policy. In the Executive Branch, we are adopting a whole-of-government approach to reduce inflationary risk brought about by geopolitical challenges.”

He cited many compelling reasons for investing in the Philippines. Among these are: the Philippines’ promising growth trajectory being the fastest growing economy in ASEAN; a demographic sweet spot with a median age population of 25 years; a huge  domestic market, the 20th biggest today; and many opportunities for investments including 185 infrastructure projects worth roughly USD160 billion.

He also highlighted the government’s commitment to ensuring business stability through prudent fiscal management, pro-business policies, and decisive political leadership.

NEDA Secretary Arsenio M. Balisacan said the slowdown of inflation last year, which is expected to continue this year will fuel consumption growth. Almost  3/4 of GDP growth is actually coming from consumption, he explained.

DBM Secretary Amenah F. Pangandaman said the national budget supports growth. “Our budget this year is USD103 billion (PHP5.768 trillion), a 9.5 percent increase from last year. Consistent with our medium-term fiscal framework, the national budget is above 20 percent of our GDP from now until 2028,” she added.

Philippine Ambassador to the United States Jose Manuel G. Romualdez noted that  President Ferdinand R. Marcos, Jr. has tasked his economic managers, with the full support of the Philippine Congress, to create an economic landscape that is open, transparent, connected, inclusive, and progressive.

Also present at the event were House Speaker Ferdinand Martin G. Romualdez, House Majority Floor Leader Manuel Jose M. Dalipe, House Deputy Speaker David C. Suarez, Agusan del Norte 1^st District Representative Jose S. Aquino II, and Philippine Ambassador to Japan Mylene J. Garcia-Albano.

Participants also included HSBC Chairman of Public Sector Banking, Global Banking, and Markets Michael Ellam and Citi Vice Chairman for Banking and Public Sector Jay Collins. Dialogue partners included Bank of America Securities, Citi, HSBC, J.P. Morgan, Morgan Stanley, Standard Chartered Bank, and UBS.

Held on the sidelines of the International Monetary Fund-World Bank Group 2024 Spring Meetings in Washington, D.C., the dialogue updated the US business community about the Philippines’ economic performance, investment opportunities, and socioeconomic agenda.