benjamin e diokno : sustainable solutions for southeast asia ’ s recovery opening remarks by mr benjamin e diokno, governor of bangko sentral ng pilipinas ( bsp, the central bank of the philippines ), for adb ’ s southeast asia development symposium ( seads ) 2022 “ sustainable solutions for southeast asia ’ s recovery ”, manila, 15 march 2022. * * * good day to all. i am honored to join you today for the southeast asia development symposium 2022. before the pandemic, the philippine economy grew at an average of 6. 4 percent annually. poverty incidence dropped from 23. 5 percent in 2015 to 16. 7 percent in 2018. while the pandemic may have set us back on some of our goals, i am confident that we are on our way to regaining our pre - pandemic growth trajectory. there are two things fueling my optimism : first is the continued confidence in the philippine economy. the country continues to have a favorable medium - term growth prospects based on the stable outlook affirmed by majority of major credit rating agencies. second, we didn ’ t sit idly by during the pandemic but pursued game - changing structural reforms, from amendments to the retail trade liberalization act, public service act, and foreign investments act. we are also pushing for amendments to the implementing rules and regulations ( irr ) of republic act no. 10000 or the agri - agra credit act of 2009, which allows banks to lend to more types of farming communities and classify more loans as compliant with the law ’ s quotas. we are positive that the senate and house will reach a consensus and ratify the bill once session resumes on may 2022. i am confident that, with these game - changing reforms, we can achieve real change in the lives of ordinary filipinos through more and better jobs and more competitive economy. also, our financial digitalization initiatives, under the digital payments transformation roadmap, are enabling better payments processes and financial inclusion. moreover, the philippine central bank ’ s policies on sustainable finance are harnessing the ability of banks to drive a more sustainable future. aided in part by the bsp ’ s measures, the economy is showing signs of solid recovery, as shown by the 5. 6 - percent gdp growth last year. this year, we expect the economy to grow by 7. 0 - 9. 0 percent. looking ahead, the philippine central bank is laying the foundation for

’ s economy this year ”. these arguments simply remind us that china is already a large economy whose economic engine happens to be traditionally stronger than most. simulations therefore of a “ hard landing ” are important to track. euromonitor international reports that ten jurisdictions most at risk from a hard landing in china include hk, taiwan, large economies like south korea, india and japan, as well as the 4 biggest asean economies ( indonesia, malaysia, singapore and thailand ) plus vietnam. what does this mean for the philippines? china is an important trading partner and has been, in fact, the third major export market of the philippines since 2011, with an average share of about 12 percent from 2010 to 2014. based on nso data, in 2014, our exports to china reached us $ 8. 5 billion or 13. 6 percent of our total merchandise exports. imf. ( august 2015 ). people ’ s republic of china staff report for the 2015 article iv consultation. imf country report no. 15 / 234, washington, u. s. : international monetary fund. the following follows the points raised in “ china economy : weakened but still growing ” by joe mcdonald, associated press. september 23, 2015. bis central bankers ’ speeches while the philippines is not among those listed in the euromonitor international study, it is significant to note that almost all those countries listed are important trading partners of the philippines. the simulated impact is a decrease in gdp growth. and the results are not trivial, ranging from just under two percentage points ( japan and indonesia ) to above 3. 5 percentage points ( vietnam, taiwan and hk which is nearly at 4. 5 percentage points ). so, while the impact on our gdp may not be strong and direct, the “ second - round ” effect through the “ other ” trading partners bears watching. what about the effect on domestic inflation? slow chinese growth could lead to lower global demand for commodities, including oil, which could in turn be a positive for reducing overall domestic inflation pressures. that said, where the chips will fall, so to speak, on the balance of global inflation will really be determined by country - specific dynamics. there are other areas wherein our economy may be adversely impacted. and let me just highlight two for now – tourism and remittances. for the moment, our assessment is that the negative impact on tourism is expected to be moderate, while on remittances, it should only be negligible. 3 fortunately,