Manila -Ferdinand Marcos, who will be the next president of the Philippines, chose familiar faces for the positions of central bank governor and finance minister on Thursday. This was a strong sign that he would keep the same economic policies.
Marcos said that Benjamin Diokno, the head of the central bank, will be his finance minister when he takes office on June 30. This will pave the way for Felipe Medalla, a member of the monetary board, to take over as governor of the Bangko Sentral ng Pilipinas. The two of them will have to deal with inflation and unemployment.
Still, Marcos takes over an economy that is much stronger than that of his late father, the dictator who was overthrown in the “people power” revolution of 1986. The debt stock is manageable, foreign reserves are at record highs, and growth rates are healthy.
“The economy will always be the top priority,” Marcos, who is 64 years old, said in an interview with his new press secretary that was broadcast live on his Facebook page (NASDAQ: FB).
“It still comes down to jobs, rising prices of goods, and giving the business community a break.”
After he starts his six-year term, Marcos will have to walk a fine line to make sure the economy keeps growing and that rising inflation, which is being caused by rising prices for rice and fuel, is kept in check.
He said again that he would cut rice prices by more than half, to 20 pesos ($0.38) per kg, as he had promised during his campaign. But he said that the Philippines, which is one of the biggest buyers of rice in the world, needs to keep bringing rice in from other countries to make sure there is always enough at home.
In the first quarter, the gross domestic product grew by 8.3% compared to the same time last year. This was the fastest growth rate in three quarters. However, a rise in interest rates could hurt domestic consumption, which is a major driver of growth, which could slow growth.
This month, the central bank started the process of tightening money much earlier than expected. This is to bring inflation back down to where it should be. On Thursday, Diokno said that the central bank might raise rates by another 25 basis points at its June meeting.
Marcos won the election this month by a huge margin, making it possible for the country’s most notorious political family to return to power. He will probably have a supermajority in Congress, which could make it easier for him to get his economic plan passed.
Economists generally liked Marcos’s choices for his team, which also included Manuel Bonoan, the head of the tollway unit at the conglomerate San Miguel Corp, as his public works secretary, and Alfredo Pascual, the former president of the University of the Philippines, as his trade minister.
In a time when competition is growing in the region, Pascual will have to find a balance between economic relations with top trading partners like China and the United States. This is because the Biden administration wants to make up for strategic ground lost under Trump by creating a new Indo-Pacific Economic Framework.
The appointments show that Marcos’s policies will continue. Marcos is expected to build on the popular economic policies of the current president, Rodrigo Duterte. This includes a long-delayed, multibillion-dollar overhaul of the country’s infrastructure.
(1 US dollar = 52.46 Philippine pesos)