THE Bangko Sentral ng Pilipinas (BSP) highlighted lower inflation and Islamic banking opportunities in the country during the Post-State of the Nation Address Philippine Economic Briefing (PEB) in Davao City on August 9,2023.
BSP Deputy Governor (DG) Francisco G. Dakila, Jr. said the 4.7 percent inflation in July 2023 is consistent with the central bank’s outlook. The BSP forecasts inflation to gradually return to the government’s 2.0 to 4.0 percent target range by Q4 2023, barring further supply shocks.
“We have seen inflation decelerate rapidly. There is a big chance that inflation will be close to or even slightly below the lower level of the target by the first quarter of next year,” Dakila said.
He also cited increased interest in Islamic banking and financial inclusion particularly in the Bangsamoro Autonomous Region in Muslim Mindanao, which is the most unbanked region in the country.
“The BSP’s Monetary Board recently approved the first Islamic Banking Unit license issued to a conventional bank, bringing the number of Islamic banking players [in the country] to two. Aside from conventional banks, we have seen interest from five foreign banks, foreign government institutions, and foreign embassies that volunteered support in tapping new Islamic banking players,” he explained.
He added that the National Government is looking forward to the issuance of the first sovereign Sukuk bonds, which is expected to generate more investments in Islamic finance and expand the country’s engagement with global economic financial markets.
Sukuk or Islamic bonds are certificates that represent shares in the ownership of assets, services, projects, or investment activities; and are issued by Shari’ah.
DG Dakila represented BSP Governor Eli M. Remolona Jr. in a panel discussion on “A Fast-Growing and Forward-Looking Economy” with Department of Finance (DOF) Secretary and Monetary Board Member Benjamin E. Diokno, Department of Budget and Management (DBM) Secretary Amenah F. Pangandaman, National Economic and Development Authority Undersecretary Joseph J. Capuno, and Philippine Chamber of Commerce and Industry, Inc. Area Vice President for Mindanao Arturo M. Milan.
Jointly organized by the BSP and the DOF, the regional economic roadshow in Davao gathered over 400 attendees from the business and financial communities, industry associations, civil society organizations, academe, media, and local government units.
In his keynote message, Secretary Diokno underscored the DOF’s commitment to working with international development partners in securing financing for key sectors, such as economic reform, food security, infrastructure development, climate adaptation and mitigation, disaster resiliency, post-conflict rehabilitation, and peace and development in Mindanao.
The panel discussion on “Building Better and Smarter for the Future” were led by Department of Transportation Secretary Jaime J. Bautista, Department of Public Works and Highways Undersecretary Maria Catalina E. Cabral, Department of Energy Undersecretary Sharon S. Garin, Public-Private Partnership Center Executive Director Ma. Cynthia C. Hernandez, and Japan International Cooperation Agency Philippines Office Chief Representative SAKAMOTO Takema.
The panel session on “Reinvigorate (Job Creation). Accelerate (Poverty Reduction). Transform (the Economy to Upper Middle-Income Status)” included Department of Labor and Employment Secretary Bienvenido E. Laguesma, Department of Information and Communications Technology Secretary Ivan John E. Uy, Department of Trade and Industry Secretary Alfredo E. Pascual, Department of the Interior and Local Government Undersecretary Marlo L. Iringan, Department of Tourism Undersecretary Mae Elaine T. Bathan, Department of Agriculture Undersecretary Mercedita A. Sombilla, and Davao Chamber of Commerce and Industry President John Carlo B. Tria.
DBM Undersecretary Margaux Marie V. Salcedo and DOF Undersecretary Maria Luwalhati Dorotan-Tiuseco served as panel moderators. PR