DOF chief cites inclusive financial system

Finance Secretary Carlos Dominguez III (Rappler Photo)

Finance Secretary Carlos Dominguez III has cited the initiatives of the Capital Market Development Council (CMDC) to make the Philippine financial system “broad-based and inclusive” through digitalization and other enhanced corporate governance practices as among the lasting legacies of the body under the Duterte administration.

In step with President Duterte’s goal of financial inclusion, Dominguez said the CMDC has, among others, helped democratize bond investing; assisted the government in swiftly moving several bills and measures in Congress that aim to strengthen our financial system; and incentivized small and medium enterprises (SMEs) to expand their sources of capital through the equities market.

“Since 2016, this Council has helped score major victories in pursuit of our mission to grow our capital markets and make the financial sector more vigorous and inclusive. We have been moving very quickly in prodding both the government and private sectors in reimagining the way they transact business with the public and in making it easier for Filipinos to invest in the market through digitalization,” Dominguez said during the CMDC’s meeting in December 2021.

Co-chaired by Dominguez, lawyer Benedicta Du-Baladad of the Financial Executives Institute of the Philippines (FINEX) and Securities and Exchange Commission (SEC) chairperson Emilio Aquino, the CMDC is a coordinating body tasked to facilitate the development of the Philippine capital market.

“A more broad-based and inclusive financial system will be one of the lasting legacies of this Council on the Duterte watch,” Dominguez, who heads the President’s economic team, added.

Dominguez pointed, for instance, to the full implementation of the Real Estate Investment Trust (REIT) Act, “which has become a powerful financial instrument for the property development sector and our small investors.”

He assured the CMDC that the Duterte administration will work “until the very last minute of its term” to pursue the reforms needed to further deepen the Philippine capital markets, such as the congressional approval of the Capital Market Development Act (CMDA) and the Passive Income and Financial Intermediary Taxation Act (PIFITA).

The Duterte administration will also “continue to strive for enhanced investor protection, improved corporate governance, the centricity of shareholders, and broader investor participation in the Philippine capital market,” Dominguez said.

He thanked his fellow CMDC members “for embracing the vision of inclusive economic growth” of the Duterte administration.

During the meeting, Du-Baladad cited as among the CMDC’s major accomplishments the listing of small and medium enterprises (SMEs) in the stock exchange; the digitalization of market transactions; the promotion of environmental, social and governance financing, including green and social bonds; the collaboration with the capital markets in monitoring unregulated loans and the debt market amid the pandemic; developing bond financing for local government units (LGUs); and the setting up of a monitoring tool to track the progress of the work under the Council’s Capital Market Development Blueprint.

She also cited the CMDC’s strong support and participation in pushing the approval of key legislative proposals that aim to deepen the capital markets, such as the PIFITA, CMDA, the Collective Investment Schemes bill, and the Government Financial Institutions Unified Initiatives to Distressed Enterprises for Economic Recovery (GUIDE) measure in the list of the Council’s accomplishments. (DOF)