benjamin e diokno : prospects for a productive partnership speech by mr benjamin e diokno, governor of bangko sentral ng pilipinas ( bsp, the central bank of the philippines ), at the fund managers association of the philippines, inc. general membership meeting, manila, 2 february 2022. * * * to the directors, officers, and members of the fund managers association of the philippines, ladies and gentlemen, good afternoon. it has been almost a year since we came together for the 13th annual fmap convention. i commend the incumbent officers of the fmap, under the leadership of mr. j vincent daffon, for ably steering the industry through the past year. today, i would like to share our perspective on recent economic developments, as well as the state of the banking and trust industries. i will also highlight the bangko sentral ’ s priority regulatory initiatives and identify potential areas of cooperation with the fmap membership. the economy has staged a strong turnaround, growing by 5. 6 percent in 2021. the full - year growth exceeded the government ’ s forecast of 5 to 5. 5 percent. the collective efforts of both public and private sectors proved crucial in ensuring a strong recovery. inflation remains manageable. while headline inflation averaged 4. 5 percent in 2021, there was a noted slowdown in price increases toward the end of the year. inflation returned to within - target range in december at 3. 6 percent. this was aligned with the bsp ’ s projections that inflation will ease toward the midpoint of the target range of 2 to 4 percent this year and in 2023. the country ’ s full - year balance of payments registered a surplus of 1. 35 billion us dollars. this was largely composed of inflows from personal remittances, trade in services, net foreign borrowings by the national government, and foreign direct investments. consequently, gross international reserves stood at 108. 9 billion us dollars as of end - 2021. this represents 10. 3 months ’ worth of import cover, way more than the three - month standard buffer to be considered adequate. domestic liquidity situation continues to reflect the decisive measures taken by the bsp over the past two years to boost liquidity in the financial system. m3, a broad measure of the economy ’ s money supply, expanded by 8. 3 percent to 14. 8 trillion pesos in november 2021. domestic claims grew in line with sustained borrowings by the

in the implementation of prudent and systematic banking reforms. i can say that today, our banking system is sound, profitable and stable ; it is responsive to the needs of the economy ; it is responsible in managing the funds entrusted to them by their customers ; and it is increasingly inclusive. ladies and gentlemen of the philippine banking sector, well done! congratulations! our banks are also highly rated by independent analysts. in 2014 for instance, philippine banks received awards and recognition for various categories that are just too many to mention here. in the interest of fairness therefore, i will desist from naming any such awards. suffice it to say, that people take note of these awards which should help define your bank as we prepare for the opportunities and challenges that come with asean integration. in addition, it is a source of pride for us that when moody ’ s assessed 69 jurisdictions in 2014, it concluded that only the philippine banking system deserved a positive outlook – only one out of 69. outlook given all these, what is in store for us in 2015? as policymakers of the national government see it, our economy will grow by 7 – 8 percent in 2015 while the inflation target is at 2 to 4 percent. 2 other institutions and analysts project lower numbers for growth. but there is one thing they have in common – the view that the philippines will continue to be comparatively buoyant. however, there are risks that cloud the future. the continuing uncertainty in the global financial markets is a concern as geopolitical tensions go on and economic performance among major economies remains divergent. june 2014 data for financial inclusion. dbcc macroeconomic assumptions ( 2013 – 2017 ), as of 20 june 2014. bis central bankers ’ speeches for instance, us economic growth continues to gain traction. with this, the market anticipates the fed will raise the fed funds target rate this year. as a result, the us dollar has been strengthening against other currencies. apart from the us, however, other major economies are slowing down weighed by debt, unemployment, weak demand and / or geopolitical concerns. these economies are moving toward stimulus programs or quantitative easing. this divergence in monetary policy between strong and weak economies could unsettle markets. while all of this was happening, the balance of supply and demand in the oil market has triggered a precipitous decline in oil prices. i have been asked how a stronger dollar and cheaper oil will affect us. well, a stronger dollar would