Economic growth for all Filipinos-A A +A
Sunday, October 6, 2013
THE Philippines is on a roll.
Following Fitch and Standard & Poor, debt watcher Moody’s Investors Service gave the country an investment grade last Thursday (October 3). Moody’s cited the Philippines’ “robust economic performance, on-going fiscal and debt consolidation, political stability, and improved governance.”
Moody’s also lauded the stability and resilience of the Philippine economy amidst external financial shocks and the slow economic growth in the Asian region.
With investment grade ratings from the three most influential debt watchers, the Philippine economy is now in an even better position to draw investments that can spur economic activity, produce more income for the nation, and eventually enhance the quality of life of the majority, if not all Filipinos.
Clearly, the goal goes beyond notching upgrades and record-breaking figures in growth. The numbers should translate to development that every Juan and Maria can feel and appreciate.
The government knows this only too well.
The pursuit of inclusive growth has been the centerpiece of the government’s economic plan for the country. As stated in the Philippine Development Plan (2011-2016), inclusive growth is a high, rapid, and sustained growth in the economy that “creates jobs, draws the majority into the economic and social mainstream, and continuously reduces mass poverty.”
It is quality economic growth that is felt by citizens across all walks of life. In short, no one is left out and no one is left behind. The same plan concedes, however, that inclusive growth has been elusive to the Philippines. This is due to inadequate infrastructure, lapses in governance, poor development of human resources, and the degraded state of our natural resources.
These concerns are seriously being addressed although we are hoping that implementation of the appropriate response could be done at a much faster pace.
Where does the Bangko Sentral come in?
As its contribution to the overall development effort, the central monetary authority has adopted financial inclusion as its flagship advocacy.
The Bangko Sentral is well aware of the fact that while the banking system, as a whole, has progressed, many Filipinos remain unbanked or under-banked.
Compared to our neighbors, the Philippines still has a low savings rate. Denied access to banks, many Filipinos still borrow through the informal channels which charge exorbitant interest rates.
Thus the challenge for the Bangko Sentral is to create an enabling environment that will provide millions of Filipinos access to the formal banking system.
Notice that now more financial institutions are venturing into non-traditional bank micro-finance products and services.
Coupled with BSP programs on financial literacy and consumer protection, former non-bank savers are now gradually being mainstreamed.
In due time, they can really participate and benefit from our economic development.