PROFILE: Finance veteran Benjamin Diokno primed to hold fort as Finance chief

Jessica Fenol, ABS-CBN News

Posted at Jun 30 2022 11:09 AM

MANILA - Incoming Finance Secretary Benjamin Diokno is no stranger to challenges, having served as central bank chief and budget secretary in previous administrations.

The 74-year-old economist served as Budget Undersecretary from 1985 to 1991, Budget Secretary from 1998 to 2001 under the term of former President Joseph Estrada and also from 2016 to 2019.

He has served as Bangko Sentral ng Pilipinas (BSP) Governor since 2019.

Diokno holds a Bachelor's Degree and Masters Degree in Public Administration, Masters Degree in Economics, M.A. in Political Economy, PhD in Economics and an honorary Doctor of Laws degree from the University of the Philippines.

Bangko Sentral ng Pilipinas’ (BSP) new governer, Benjamin Diokno at work shortly after an interview with Cathy Yang for ANC’s The Boss, held at the BSP headquarters in Manila on March 12, 2019. George Calvelo, ABS-CBN News
Bangko Sentral ng Pilipinas’ (BSP) new governer, Benjamin Diokno at work shortly after an interview with Cathy Yang for ANC’s The Boss, held at the BSP headquarters in Manila on March 12, 2019. George Calvelo, ABS-CBN News

In total, he has over 30 years of experience in serving the government's economic team.

In an interview with ANC, Diokno said it took some convincing before he agreed to be the next Finance chief, but he also said he couldn't say no when duty calls.

"The president says he needs someone to be responsible in running the economy and that’s it. How can you refuse a president which was elected by 31 million Filipinos," Diokno said.

“It is an honor to serve the Filipino people in my current and any future capacity. I am grateful and humbled by the trust given to me by the President-elect to help his administration manage the country’s fiscal affairs,” he added.

With the acceptance of the appointment, Diokno will cut short his tenure as the central bank chief, which is supposed to end in July 2023. He will replace outgoing Finance Secretary Carlos Dominguez III.

Under Diokno, the BSP assisted the government in cushioning the impact of the COVID-19 pandemic.

The BSP reduced interest rates to a historic low of 2 percent and cut the required reserve ratio for banks to 12 percent to support lending and boost the economy. 

The pandemic however pushed the country's debt-to-GDP ratio to 63.5 percent in the first quarter, which is beyond the global standard of 60 percent.

Rising inflation is also pushing central banks around the world to raise interest rates, which can slow down growth.

But Diokno, who said he has seen worse economic crises, said he is optimistic that the country can "outgrow" its debt. Sustaining growth will address most economic challenges, he said.

DIGITAL PUSH

With Diokno championing digitalization, BSP has also been among the most welcoming to innovations globally. 

It has approved a digital banking framework to allow digital banks to operate in the country. It is also among the pioneering nations to explore central bank digital currencies

The central bank has been granting Virtual Asset Service Providers (VASP) licenses to allow fintech firms to engage in cryptocurrencies. 

The BSP's digitalization roadmap aims to shift 50 percent of payments to digital and onboard 70 percent fo the adult population to the financial system by 2023.

ECONOMIC PRIORITIES
 
Among the priorities of the incoming Finance chief is reducing the deficit-to-GDP ratio to 7.6 percent in 2022, 6.1 percent in 2023, 5.1 percent in 2024 and 4.1 by 2025. 

He said he is confident in reducing poverty and in becoming an upper-middle-income country - goals which were almost achieved if not for the pandemic.

“As Finance Secretary, I will strive to continue prudently and carefully balancing the need to support economic growth, on one hand, and to maintain fiscal discipline, on the other,” Diokno said.

"Any job, I just do the best I can, given the resources and look for the best way to execute whatever assignment I have and to make sure that the association I’m associated with will be in a much better place than the institution that I inherited. Improve what you’re presented with," he told ANC. 
 
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