financial storm. current situation how should we respond to the challenges before us? the first step is to recognize where we stand at the moment. thus, allow me to share with you some insights on the impact of the global financial crisis on the philippine economy. as we all know, 2008 has turned out to be one of the most challenging years we ’ ve had, as we coped with two major challenges. in the first half of the year, we were confronted by surging prices of oil and non - oil commodities which caused inflation to accelerate globally. in the second half, we faced the international financial turmoil that was ignited by the u. s. subprime mortgage problem and, which subsequently, turned into a global financial meltdown. while the philippine economy has remained generally resilient and has been described by a ratings executives as an “ island of calm ”, it does not mean that we are totally immune to adverse global developments. as in most other countries, our currency has generally weakened, credit spreads have widened, and the stock market has fallen. some economists believe that 2009 could even be tougher than 2008 once the impact on the real economy is felt. nevertheless, it is not all gloom and doom for us. the philippines has buffers that can help us through the current global economic crisis. our output growth continues to be demand - driven, led by consumption as well as capital spending. moreover, the country ’ s gdp growth for the first three quarters of 2008 is still within the country ’ s long - term growth trend. compared against our neighbors, this growth performance is quite respectable. meanwhile, easing prices of oil and other non - oil commodities in the world market and moderating inflation expectations have reduced inflation pressures and protected the people ’ s purchasing power. easing inflation pressures provide flexibility for the bsp to formulate policies supportive of the real economy while keeping an eye on the risks to stable prices. recent adjustments in fiscal targets also provide some policy space to support growth. the postponement of the balanced - budget objective to 2010 should provide additional resources to government to boost infrastructure spending and enhance social safety nets that will protect the vulnerable segments of our population. the country ’ s stable external payments position also provides additional buffer against the global economic slowdown. the country ’ s balance of payments, although significantly lower than in 2007, has remained in surplus in 2008 with our gross international reserves at an all - time high. finally, the banking system remains sound due to continuing policy and

amando m tetangco, jr : career executives in government – making lives better for filipinos speech by mr amando m tetangco, jr, governor of the central bank of the philippines ( bangko sentral ng pilipinas ), at the ces circle forum, manila, 26 january 2009. * * * executive director allones of the career executive service board, distinguished panelists, the elite corps of government employees who make up the career executive service officers and eligibles, colleagues in government service, special guests, good afternoon. on behalf of the men and women of the bangko sentral ng pilipinas, i welcome all of you to our head office for the inaugural ces circle forum. circle, which stands for creative innovations and reforms for committed leadership and effectiveness, is a most appropriate symbol for this program that aims to nurture thought leadership in government : a circle is never - ending and so should our efforts to learn and continuously find better and more efficient ways of doing things. i also find the timing for this new program for cesos and ces eligibles quite auspicious. this is the first month of the year and, coincidentally, the celebration of the chinese new year – the beginning of the year of the ox, one of the most hardworking and productive creatures on earth. ladies and gentlemen, for its resolute efforts to strengthen and broaden professional competence in government let us give the ces board a well - deserved round of applause! the theme for this circle forum is thought - provoking and challenging : bagong taon, mga bagong hamon, ceso ’ t eligibles, paano ka tutugon? ” earlier, you heard about the labor situation as well peace and national security issues. on my part, i cannot overemphasize that this will be a particularly challenging year for us as a country as we grapple with the impact of the ongoing global financial crisis. what began with the market turmoil surrounding u. s. subprime mortgages, has become an economic and financial crisis that threatens the global community in magnitudes reminiscent of the 1930s “ great depression ”. no economy has been unscathed by the global headwinds. and the crisis has landed on our shores as well. as leaders and managers in our respective government agencies and offices, the burden is upon us to craft and implement policies and measures that will enable our country and our people to ride out this economic and