PH to emerge from crisis stronger, says Diokno

The Philippines will emerge from the COVID-19 pandemic with an economy that is better than the one it had entering it, thanks to a slew of reform measures being undertaken by the government, according to the central bank.

Speaking to a group of central bankers, financial regulators and investors from around the world, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno shared how the country was striving to achieve a postCOVID economy that is also more technologically advanced, and more inclusive than before.

“Looking ahead, we do not aim to simply regain the economic losses from the pandemic,” he said in a virtual forum organized by London-based think tank Official Monetary and Financial Institutions Forum. “We aspire for a post-COVID-19 Philippine economy that is stronger and more resilient, more technologically advanced, and more inclusive than ever before.”

Diokno noted that the Philippines was already set to graduate from lower to upper middle-income status right before the pandemic and, as such, was keen to regain its momentum in the post-COVID era.

The forum provides an international platform for central banking and public policy dialogues, such as through events whose audience includes financial sector regulators and financial industry players from the private sector.

In it, the central bank chief shared that the Philippines is pursuing this goal in three ways and that the BSP is an active partner of the government toward this end.

First is by further liberalizing the economy and making it even more investor friendly, such as through the country’s participation in the Regional Comprehensive Economic Partnership among select Asia-Pacific economies and legislative reforms like the Corporate Recovery and Tax Incentives for Enterprises law.

“On the part of the BSP, we support investment promotion through a regulatory environment that is welcoming to foreign investors and technological innovation,” Diokno said.

Second is by infrastructure development. Citing the BSP’s contribution to the government’s infrastructure development drive, Diokno said the BSP was “contributing to infrastructure development through regulatory measures such as by increasing the single borrower’s limit (SBL) as well as deepening of the capital market that makes it easier for infrastructure companies to finance projects.”

The BSP last year implemented time-bound regulatory relief measures that included an increase in the SBL from 20 to 25 percent and exemption from this cap of debt securities acquired by banks from market-making activities. These two measures were meant to support infrastructure development amid the pandemic.

Third is through the inclusion agenda.

“[BSP] regulations and advocacy programs meant to ease access of micro enterprises to credit and other financial services are in place and are constantly revisited for enhancement,” Diokno said.