2019 Pre-SONA Economic and Infrastructure Forum 1 July 2019 Philippine International Convention Center The Philippine Economy Towards Resilience and Sustainability DIWA C. GUINIGUNDO Deputy Governor Bangko Sentral ng Pilipinas
MAINTAINING A MANAGEABLE INFLATION ENVIRONMENT Headline inflation is within target for the first Market rates have adjusted to BSP policy moves five months of 2019 BSP and Market Interest Rates Peak: 6.00 6.7% (Sep. 2018) OLF Policy Rate ODF 5.50 7-day TDF 28-day TDF 14-day TDF 5.00 IBCL rate 3-month GS rate 4.50 4.00 Percent 3.50 3.00 2.50 Latest (2019): 2.00 3.2% (May. 2019) 1.50 1.00 3.6% (Jan-May 2019) 0.50 Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr 2016 2017 2018 2019 Growth and inflation forecasts 2019 2020 ROP Official Targets Real GDP, % (March 2019) 6.0-7.0 6.5-7.5 Inflation, % 2.0-4.0 2.0-4.0 BSP Forecast, % (2012-based)* 2.7 3.0 IMF (April 2019) Real GDP, % 6.5 6.6 Inflation, % 3.8 3.3 ADB (April 2019) Real GDP, % 6.4 6.4 Inflation, % 3.8 3.5 *20 June 2019 MB meeting Sources: BSP, PSA, IMF, and ADB 2
MANAGEABLE EXTERNAL PAYMENTS POSITION ANOTHER BUFFER AGAINST EXTERNAL HEADWINDS Strong growth in goods imports led to narrowing of current account; impact tempered by sustained receipts from traditional sources Source: BSP 3
4
MANAGING THE COUNTRY’S EXTERNAL DEBT 5
PROMOTING A STABLE AND SOUND BANKING SYSTEM Solid asset growth Improved quality of loan portfolio Strong capitalization well above Sustained profitability International norms Source: BSP 6
MAINTAINING A SAFE AND RELIABLE NATIONAL PAYMENTS AND SETTLEMENTS SYSTEM National Retail Payment System (NRPS) 50 participating institutions 27 participating institutions 7
LEGISLATIVE LANDMARKS BSP Charter Amendments: Pres. Rodrigo R. Duterte has signed into law “Republic Act No. 11211, or An Act Amending Republic Act No. 7653, Otherwise Known as the ‘New Central Bank Act’, and for Other Purposes,” on 14 February 2019. Enactment of the Payment Systems Act: On 30 October 2018, President signed into law a landmark legislation that provides for the oversight, regulation and supervision of payment systems in the country, Republic Act (RA) No. 11127 or the National Payment Systems Act (NPSA). Enactment of the bill exempting from taxes the sale to the BSP of gold produced from small scale mining activities: RA. No, 11256, or An Act to Strengthen the Country’s Gross International Reserves (GIR), was approved by Congress and signed by President Rodrigo R. Duterte last 29 March 2019. Bill on the Enactment of Islamic Banking in the Philippines: This bill aims to develop a suitable legal and regulatory framework to promote a truly responsive Islamic banking system that positively complements the existing conventional banking system in the country. 8
SUSTAINING ADVOCACIES National Strategy for Financial Inclusion (NSFI): provides the national vision for financial inclusion and a platform for public and private sector coordination to ensure synergy of efforts in achieving shared objectives . Microfinance: As of Dec 2018, there are 159 banks with microfinance operations serving 1,986,683 micro- entrepreneurs. Economic and Financial Learning Program (EFLP): In 2018, 3 learning programs, 1 Fin-ED Expo (1,000 participants), and 28 Financial Empowerment Seminars (3,400 participants) were conducted. Credit Surety Fund (CSF) Program: More than 50 CSFs have been established nationwide benefitting nearly 18 thousand MSMEs . 9
PHILIPPINE ECONOMY ON ITS WAY TO UNLOCKING FURTHER ITS GROWTH POTENTIAL Expanding further PH’s productive capacity to allow it to keep up with robust demand Incremental Capital-Output Ratio Total Factor Productivity Source: Staff estimates as of 25 January 2019 Employment Share by Class of Workers Employment Share by Educational Attainment Source: PSA 10
KEY RISKS AND CHALLENGES AHEAD Impact of US Fed rate Policy uncertainty and Global economic Ratcheting up of trade adjustments geopolitical tensions (e.g. US- slowdown tensions Iran, Brexit, etc.) Disruptive Infrastructure gaps Extreme weather technologies events 11
BSP geared up for the road ahead 70 years of Central Banking Efficient Price Financial payments & settlements stability stability system Bangko Sentral ng Pilipinas 12
2019 Pre-SONA Economic and Infrastructure Forum 1 July 2019 Philippine International Convention Center The Philippine Economy Towards Resilience and Sustainability DIWA C. GUINIGUNDO Deputy Governor Bangko Sentral ng Pilipinas
Recommend
More recommend
