New Economic Team: A Smooth Transition
The incoming economic team of President-elect Ferdinand Marcos Jr. is a wise choice—the composition quickly allayed the concerns of some in the business sector that the new administration may deviate from the policies of the outgoing administration.
It is normal for businessmen and entrepreneurs like me to be wary of the people joining a new administration. There is that element of uncertainty and fear that business rules could change overnight. Policy continuity is critical in business planning. A drastic change in the economic blueprint of the previous administration will throw the business plan of established companies and the ordinary entrepreneurs off course.
Mr. Marcos immediately cast aside these apprehensions when he announced last week the initial list of his economic team. He named Bangko Sentral ng Pilipinas Governor Benjamin Diokno as the incoming Finance chief to replace outgoing Finance Secretary Carlos Dominguez III. Mr. Diokno’s appointment is a clear signal that Mr. Marcos’s administration will continue with the policies of the current administration and build on their gains. Mr. Diokno has worked with Mr. Dominguez in steering the economy at the height of the pandemic and toward its full recovery.
The appointments quickly drew a favorable response from the business community. The Makati Business Club pledged its support to the new team, describing the incoming Cabinet members as experienced and well-known leaders that would boost the confidence of local and foreign businesses.
The economic team of outgoing President Rodrigo Duterte, led by Mr. Dominguez, did well despite the challenges posed by the Covid-19. It navigated the pandemic with resolve, caused the inoculation of majority of our population and allowed businesses to reopen. The Philippine economy bounced back with a growth of 8.3 percent in the first quarter of 2022, when the rest of Asia is locking down and struggling to contain the virus.
I remain upbeat that the economy will perform solidly in the coming quarters and succeeding years. Rising inflation is a concern but I am confident Mr. Diokno and his appointed successor, Mr. Felipe Medalla, will find the ways and the means to curb rising prices. Mr. Medalla is not a stranger to the BSP or to the economic team. He is a current member of the Monetary Board and was the director-general of the National Economic and Development Authority from 1998 to 2001 during the term of former President Joseph Estrada.
Another notable appointment is that of Mr. Arsenio Balisacan as economic planning secretary and Neda director-general. He held the same positions from May 2012to January 2016 under the administration of the late President Benigno Aquino III.
The appointment of these three to key economic posts speaks volumes about the direction that President-elect Marcos wants to tread. All of them are seasoned economists who have taken the helms of important government agencies in various administrations.
I would also like to congratulate the other appointees in the economic team, namely Management Association of the Philippines President Alfredo Pascual as the new secretary of the Department of Trade and Industry, Manuel Bonoan as incoming secretary of the Department of Public Works and Highways, Bienvenido Laguesma at the Department of Labor and Employment and Susan Ople as secretary of the new Department of Migrant Workers.
I expect the new economic team composed of Mr. Diokno, Mr. Medalla, Mr. Balisacan and the rest to keep the macro-economic fundamentals and the firm fiscal policies of the Duterte administration intact. These fundamentals that consist of stable exchange and inflation rates, high gross international reserves, a stable banking sector and favorable external payments position, backed by robust remittances from our overseas Filipino workers, have helped us overcome the pandemic and retain our investment credit rating from foreign institutions.
May I note that President-elect Marcos’s choice of Cabinet members, so far, has transcended political colors, true to his campaign promise of uniting the nation. Mr. Diokno, Mr. Balisacan and Mr. Medalla at one time or another served the presidencies of the late Corazon Aquino, Joseph Estrada, Benigno Aquino III and Rodrigo Duterte.
The task of putting the economy on a much firmer recovery path will not be easy and fraught with challenges. But I must say the Philippine economy will continue to be in good hands with last week’s Cabinet post announcements.