Duterte’s most important appointment (MIA)

DEPARTMENT of Finance Secretary Carlos Dominguez III, a member of the Monetary Board of the Bangko Sentral ng Pilipinas representing the Duterte cabinet, at the induction of the Economic Journalists of the Philippines said, “The choice of the new BSP governor will be one of the most important, if not the most important appointment that President Duterte will make. The President will personally interview the candidates.” Many businessmen agree with him as they have seen how the economic growth in the Arroyo, Aquino, and the Duterte administration has been due substantially to the effective functioning of the Monetary Board and BSP, a constitutionally mandated independent monetary authority led by a professional central banker, BSP Governor AmandoTetangco Jr. Bankers and businessmen have expressed the view that such a sensitive and valuable position should not be lumped together with other government appointments usually given as political rewards.

Chapter I, Article I. Section 1 of the New Central Bank Act (RA 7653) states, “The State shall maintain a central monetary authority that shall function and operate as an independent and accountable body corporate in the discharge of its mandated responsibilities concerning money, banking, and credit. In line with this policy, and considering its unique functions and responsibilities, the central monetary authority established under this Act, while being a government-owned corporation, shall enjoy fiscal and administrative autonomy.” This grant of independence which includes fixed terms of six years for the governor and members of the monetary board with one reappointment as well as non-confirmation by the Senate and Congress has kept the BSP from suffering the same fate as the old Central Bank which was run like the administration’s bank and saddled with duties outside of its core business.

Calls, therefore, for the Bangko Sentral to become an active participant in the administration’s fight against criminality, including drugs, should be considered in the context of the BSP’s mandate for a safe and secure banking system earning the trust and confidence of the public. As indicated in RA 7653, “The primary objective of the Bangko Sentral is to maintain price stabil- ity conducive to a balanced and sustainable growth of the economy. It shall also promote and maintain monetary stability and the convertibility of the peso.”

Any investigation into and provision of information for the Duterte administration’s anti-drugs, anti-criminality and anti-corruption campaign, should be within the purview of BSP’s membership in the Anti-Money Laundering Council, whose actions are guided by due process and court decisions. This is also one reason that a concern arises when an appointee to the BSP Governor position has been actively involved in the political arena since it may be possible that the BSP may become a political tool. This concern is understandable given the awesome powers of the BSP as stated in RA 7653: “It shall have supervision over the operations of banks and exercise such regulatory powers as provided in this Act and other pertinent laws over the operations of finance companies and non-bank financial institutions performing quasi-banking functions, hereinafter referred to as quasi-banks and institutions performing similar functions.”

President Duterte this coming July will not only appoint the governor but also three other members of the Monetary Board. It is important to note that Sec. 8, Article II of RA 7653 states the qualifications as follows, “The members of the Monetary Board must be natural-born citizens of the Philippines, at least thirty-five (35) years of age, with the exception of the governor who should be at least forty (40) years of age, of good moral character, of unquestionable integrity, of known probity and patriotism, and with recognized competence in social and economic disciplines.”

For the good of the banking system and the interests of the Filipino people we hope that President will make the right decision in this MIA.