To strengthen regional collaboration against financial shocks, the Bangko Sentral ng Pilipinas’ (BSP) BSP Research Academy, with 20 leading research institutions in the region and the ASEAN+3 Macroeconomic Research Office (AMRO), have signed a Memorandum of Cooperation (MOC) during the launch of the ASEAN+3 Finance Think-tank Network (AFTN) before the weekend.

BSP Governor Eli M. Remolona Jr. said the AFTN will enhance the information exchange and regional research mobilization to enable ASEAN countries and other partner nations to overcome any systemic threats to the Asian financial systems.

"Over the past few years, the region has experienced systemic and exogenous shocks of varying forms. These include geopolitical concerns, intensifying effects of climate change and a pandemic. Amidst these challenges, we have thrived because we have worked together to deliver on our mandates,” he said in a statement late Friday, Sept. 29.

He added that the “establishment of the ASEAN+3 Finance Think-tank Network draws from the same spirit (and) this Network will serve as a venue for information exchange and regional research mobilization.”

Remolona said he “personally look forward to BSP's active participation” in the AFTN.

From the Philippines, there are only two members of AFTN – the BSP Research Academy and the Philippine Institute for Development Studies.

Under the AFTN MOC, the network members pledge to strengthen cooperation and collaboration in areas of common interest through the following: joint research; dialogues; knowledge exchange; and mobilization of regional research resources.

Remolona said last month that the Philippine economy and banking sector are not in any danger but the BSP is not taking any chances in strengthening systemic risk surveillance systems against contagion threats.

The BSP chief said there are global and regional developments that they monitor closely and this is where systemic risk surveillance is critical.

The economy and the financial system are intertwined, and any decision or monetary policy actions by the BSP will have an impact on the country’s growth trajectory and in the management of capital and funds, including debt payments both in US dollars and in peso.

The BSP-led Financial Stability Coordination Council (FSCC) which includes the Department of Finance, the Insurance Commission, the Philippine Deposit Insurance Corporation, and the Securities and Exchange Commission is in-charge of mitigating systemic risks which threaten the stability of the overall Philippine financial system.  

Remolona, as FSCC chairperson, has noted that there are “several positives marking the local financial market” such as an expanding but moderately growing economy. As for inflation which had six consecutive months of declines from February to July, it is still above the government target of two percent to four percent. In August, the consumer price index bucked the declines and increased to 5.4 percent, bringing the year-to-date average to 6.6 percent.

The FSCC in its recent meeting has observed that global growth prospects “are more positive today than several months ago” but the group noted evident pressures from the advanced economies and even from within Asia.