the view of jan hommen such supervisory objectives compare well with those of the business community. to illustrate this i will select some sound bites from a recent speech by jan hommen. speaking before a financial reporting oversight seminar organised by vno / ncw and afm, jan stressed the importance of oversight in preventing regulatory arbitrage, and of harmonised accounting standards. such prevention is important, according to him, in order to guarantee a level playing field. he also said that public oversight of financial reporting contributes to the confidence in financial markets. and he went even further to say that the benefits of this type of public oversight may be diminished if not accompanied by good governance within the company itself. indeed, congruence is important both ways. rules and regulations should align with internal practices, and internal practices should be in line with formal governance structures. it is good to see that our views align to such a great extent. conclusion on the role of public oversight in sum, only a balanced mix of sound governance structures and related practices together with transparent public oversight will give europe a competitive internal market. public overseers´ efforts for ´sense and simplicity´ ; an example i now come to the second part of my speech. the business community, including the financial sector, also needs legislation, standards, codes and guidance to be able to play the game. the rules of the game should, however, be conducive to the ´sense and simplicity´ in their appliance. as you know better than anybody, this is an important principle, but far from easy to apply. this is also an important aspect of the role of the public overseers. allow me to illustrate this role by taking an example from recent experience. as you know, the international accounting standards board has issued the revised standard on financial instruments, ias 39. the european community faced the issue of endorsing this revised accounting standard by the end of last year. a key issue here was the so - called fair value option. this option allows financial reporting entities to use fair values for the financial instruments in their accounts. the business community, amongst others banks and insurers, expressed concern about the revised standard. moreover the european central bank and the basel committee on banking supervision criticized in particular the risk of inappropriate use of the fair value option. the fair value option what was the problem? the international accounting standards board, as a matter of policy, issues standards which can be applied by all relevant organisations, without

strategies in a manner that avoids risks associated with early or late implementation. yet, while we are responding to the pandemic, we remain laser - focused busy in pursuing further reforms to improve our conduct of monetary policy and financial sector supervision. 1 / 3 bis central bankers'speeches on the monetary front, for instance, the bsp started issuing its own debt securities in september last year. this increases bsp ’ s set of tools to manage liquidity in the economy, consistent with our price stability mandate. with the bsp at the forefront of efforts to digitize the philippine economy, we launched the digital payments transformation roadmap last year which is expected to help propel boost economic growth. we also recently issued frameworks for enhanced risk management, and the creation of digital banks — all of which help further strengthen and enhance the financial system. moving to the latest updates on prices, external accounts and the banking system. on price stability, latest estimates by the bsp showed that inflation will average 4. 2 percent this year, a little above the high end of the 2 to 4 percent target range. but inflation will return to within target band next year at 2. 8 percent. the elevated inflation seen over the past three months is transitory ; it is due to weather - related disturbances on the supply of key food items, the effects of african swine fever, as well as higher global oil prices. the department of finance, the department of agriculture, and the department of trade and industry are implementing measures to ease the impact of supply - side pressures on inflation and thereby prevent them from spilling over as second - round effects. meanwhile, demand - side pressure remains subdued. the bsp ’ s monetary board is of the view that prevailing monetary policy settings remain appropriate to support the government ’ s broader efforts to facilitate economic recovery. the bsp, nonetheless, stands ready to use the full range of its instruments, as appropriate, to ensure that the monetary policy stance continues to support the bsp ’ s price and financial stability objectives. on the external front, we continue to have adequate buffers against shocks. as of end - february, gross international reserves continue to be hefty at us $ 105 billion. our external debt remains prudent at 27. 2 percent of gdp. remittances from overseas filipinos remain resilient. after contracting by 0. 8 percent in 2020, it is expected to rebound by 4 percent this year. we expect surpluses in the current