Benjamin Diokno confident PH can 'easily outgrow' debt | Inquirer News
Close  

Benjamin Diokno confident PH can ‘easily outgrow’ debt

/ 10:05 AM May 27, 2022
Incoming Finance chief Ben Diokno

Incoming Finance Secretary Benjamin Diokno

MANILA, Philippines — Incoming Finance Secretary Benjamin Diokno expressed confidence that the country can “easily outgrow” its debt, stressing the need to focus on sustaining economic growth rather than raising taxes.

“I think I have the benefit of having served the government for around more than 30 years and I’ve seen all the crises. We’re in a better position now than before,” Diokno said in an ANC interview on Friday.

ADVERTISEMENT

“I’m not worried about the level of the debt, for example. That’s 63 percent, that’s easily manageable because as long as  the economy can grow at 6 to 7 percent—which was our record before the crisis—we can easily outgrow our debt and most of our debt is domestic rather than foreign,” he added.

Diokno, who is currently serving as Bangko Sentral ng Pilipinas governor, is the pick of President-elect Ferdinand “Bongbong” Marcos Jr. to lead the Department of Finance (DOF).

FEATURED STORIES

Diokno, who also previously served as budget chief under the Duterte administration, said the country’s tax structure is “much better” than before.

He cited the country’s economic situation in the past, saying he has “seen the worst of the Philippines.”

“At that time we’re heavily indebted…Before our foreign exchange reserve was maybe only down to two weeks’ worth of imports, now it’s more than nine months’ worth of imports. We’re in a better place right now,” he said.

“The problem now is how do you come up with a fiscal consolidation program. Because right now, our deficit is in the neighborhood of seven percent of GDP (gross domestic product). We want to go back to three percent of GDP and I think we have a plan for that,” the incoming Finance chief added.

Sustain growth

Diokno said the country needs to get back on its economic growth trajectory and be able to sustain it to allow higher tax collection.

“That will solve a lot of problems. If we grow at six to seven percent, that solves our tax revenue problem, that will solve our deficit problem, that will solve our concern for poverty reduction,” he said.

“The focus should be to sustain growth because by sustaining growth, you solve your tax problem because when the economy is growing, our tax collection is also growing, it’s what economists call elastic, the higher the growth, the higher the tax collection,” he added.

ADVERTISEMENT

Duty calls

When he was offered to take the helm of the DOF under the next administration, Diokno admitted having “some doubts” at first.

“Duty calls…The president said he needs somebody who will be responsible for running the economy. How can you refuse the president who’s elected by 31 million Filipinos? So, that’s the story,” he said.

“There are some doubts, I resisted as much as I could but there were a lot of people calling me so I finally gave in,” he added.

RELATED STORIES

Tax plan to save PH from debt burden lifts PSEi

Higher taxes pitched to repay Duterte’s COVID-19 debts

PH needs P326 billion yearly to pay debts

/MUF/KGA

Subscribe to our daily newsletter

By providing an email address. I agree to the Terms of Use and acknowledge that I have read the Privacy Policy.
Read Next
Don't miss out on the latest news and information.

Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.

TAGS: BSP Governor Benjamin Diokno, Debt, Economy, Finance, Nation, News, Taxes
For feedback, complaints, or inquiries, contact us.

Subscribe to our daily newsletter

By providing an email address. I agree to the Terms of Use and
acknowledge that I have read the Privacy Policy.



© Copyright 1997-2022 INQUIRER.net | All Rights Reserved

We use cookies to ensure you get the best experience on our website. By continuing, you are agreeing to our use of cookies. To find out more, please click this link.