seen by international debt watchers as a source of sovereign strength. the third benefit is the continued increase in the volume and value of philpass transactions — from its modest start in 2002 with 5, 685 transactions, first quarter 2017 transactions alone already hit 419, 455 while value of transactions shot up from p2. 4 trillion in 2002 to p78. 7 trillion in the first quarter 2017. indeed, confidence in the bsp ’ s philpass supports the continued growth and development of our financial system. the fourth improvement is the sustained build - up of the country ’ s foreign exchange reserves — from a gir level of $ 18. 5 billion enough to cover about 4. 6 months ’ worth of imports of goods and services in 2005, our import cover had moved up to about 9 months on a gir of $ 82. 2 billion as of end may 2017. at the same time, the country ’ s debt management program saw external debtto - gdp improve by more than half — from 59. 7 percent of gdp in 2005 to 24. 0 percent as of end - march 2017. the fifth benefit is the country ’ s elevation to investment grade beginning 2013. major international credit rating agencies ( i. e., moody ’ s, fitch, and s & p ) uniformly acknowledge the bsp as one of the institutional pillars that generates positive marks for the country. ladies and gentlemen, the bsp has been able to accomplish all these because, as an institution, the bsp is ready. it is nimble enough to be able to adapt to the changes in its operating environment. we have built capacity among our people, streamlined processes, leveraged off technology as appropriate, and inculcated an overall sense of good governance and accountability in all that we do. in recent years, we have also institutionalized the new norm of financial stability in our organization as well as in policy coordination and cooperation with other financial regulators. this new mindset has allowed us to put on a more holistic lens in the conduct of surveillance and the crafting of policy. so far, so good. looking ahead, i see the bsp successfully pursuing its mandate to help provide 2 / 3 bis central bankers'speeches stability and promote sustained growth of our economy through monetary and banking policies. ladies and gentlemen. we thank president rodrigo roa duterte for having chosen the path of stability and continuity by appointing veteran central banker nestor espenilla, jr. as our new bsp governor

create beautiful harmonies that add up to masterful symphonies. of course, there were times we heard some discordant notes. but by and large, we played harmonious and beautiful music together, so to speak, that resulted in benefits for our people! let me cite some highlights of our performance : we achieved low and stable inflation conducive to sustained economic growth by adopting data - driven and forward looking policies ; we have a sound, stable and liquid banking system that is well - capitalized and supports the financing needs of our economy particularly the productive sectors ; we operate a safe and reliable payments system that minimizes possible systemic risks and inspires confidence in our financial system ; we have nurtured a strong external position that provides buffers to potential shocks to the 1 / 3 bis central bankers'speeches economy and the financial system ; and we are implementing a comprehensive agenda for financial inclusion to ensure inclusive growth that improves the quality of life of filipinos. given these positive outcomes, how do these play out and benefit our economy and our people? the first and most notable positive change is the transformation of the philippine economy — from being described as the sick man of asia, we have moved up as a rising tiger economy whose growth is among the fastest in the region. in cooperation with other institutions, we have achieved the ideal convergence of low inflation amid high economic growth. definitely, the size of the economy has been expanding — from an average gdp growth of 4. 9 percent from 2005 to 2010, growth went up to an average of 6. 1 per cent in 2011 to 2016 and reached 6. 4 percent in the first quarter of 2017. on the other hand, inflation averaged 5. 2 % in my first six years as governor ( from 2005 to 2010 ) and dropped to 3. 0 % in my second term ( 2011 to 2016 ). from january to may this year, inflation has remained stable and averaged 3. 1 %. the second positive outcome of our policies is the strengthening of our domestic banks, particularly in terms of size, capitalization and reach. the banking system has tripled in size over the past decade, with year - on - year growth of 12. 6 percent. as of end - april 2017, the total resources of the banking system reached p14 trillion, the highest on record. parallel to this, banks ’ overall capitalization is at levels above both the national requirement and the international bis standard. as the main provider of domestic credit, the philippine banking system is