PH Central Bank Governor Delivers Tour D’horizon in DC, Expresses Optimism About PH Financial Growth

BSP Governor Amando M. Tetangco delivers a public lecture entitled “Delivering Bold Strokes Without Throwing Caution to the Wind” at the Philippine Chancery in the afternoon of April 18.

21 April 2017 WASHINGTON, D.C.— Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco, Jr. delivered a lecture entitled “Delivering Bold Strokes Without Throwing Caution to the Wind,” at the Philippine Embassy in Washington DC on April 18.

Attending his last World Bank/IMF Spring Meeting before ending his second six-year term in July, Governor Tetangco’s lecture was a virtual tour d’horizon about his tenure as BSP Governor, his observations about current economic developments, and his thoughts about the future of the global economy. The lecture also detailed the gains of the Philippine economy during his tenure and his expectations with regard to its trajectory given the trends and developments in the world today.

On the global outlook and risks, Governor Tetangco noted the growth projections recently released by the International Monetary Fund, and how despite the good prospects for many economies, the global economic upturns seem to be uneven. He cautioned about possible global headwinds resulting from “asynchronous monetary policy in reaction to modest but uneven recovery in global economic activity.” He also noted that dissonance between perception and actual policy moves heightens market volatilities, and that the risks of retreat from multilateralism also produce global policy uncertainty.

Governor Tetangco expressed firm belief in the sustainability of the Philippine growth momentum. Describing the growth drivers of the economy at the moment, he noted that there is a broader base for economic expansion. Inflation remains within the target outlook and expectations, and the banking system is sound and stable. He also pointed out the robust external profile in the balance of payments and gross international reserves, and argued that the exchange rate is market-determined and that the Philippine peso remains broadly stable and competitive.

On the question of reaping dividends from growth, he told the audience that he expects institutional and systemic reforms to yield further dividends particularly in improved labor market outcomes and income equality. He also said that the national government has laid the foundations for inclusive growth, especially with the projected increased spending in infrastructure. To these ends, the BSP remains committed to maintaining price and financial stability.

In reflecting on the lessons learned during his time at the helm of the BSP, Governor Tetangco emphasized the importance of maintaining the bank’s “institutional independence as a vital foundation of efficient and effective policy making.” He also underscored the need for central banking not to lose sight of the social dimension of monetary and financial policy. He outlined the BSP’s efforts at enhancing access to credit and finance, including its strategies for financial inclusion; promoting financial education; and upholding consumer protection.

During the open discussion, Governor Tetangco fielded questions on China’s increased role in the country’s development efforts, the prospects for enhanced Philippines-US relations, ASEAN priorities in the financial sector, and his thoughts on the forthcoming leadership transition at the BSP, among others.

The lecture completes the broad picture of the state of the Philippine economy today and an opportunity to emphasize that the Philippines remains open for business. END

DC Community attends BSP Governor Tetangco’s public lecture held at the Philippine Chancery on April 18