EJAP President Neil Jerome Morales; fellow workers in government; and friends from the media: good morning. It’s very nice to see all of you again. 

In the past six months that I have been Secretary of Finance, we have already made countless policy decisions. And I have seen how you have all worked hard to accurately report what needed to be communicated.

So allow me to thank all of you for your dedication to truth, and for providing proper context that enables our people to fully appreciate the long-term gains of our actions.

We will rely on you to continue informing the public about the critical aspects of our decision-making process.

At the core of every policy and every choice is a steadfast commitment and a delicate balancing act. We will do everything within our power to ensure that the next generation of Filipinos does not inherit today’s challenges.

First and foremost is food security—the top priority of the Marcos Jr. administration. 

We are sparing no effort to shield our people from high food prices, which pose the most direct threat to food security.

For example, rice has been the major driver of inflation since September of last year due to price increases in the global market.

Rice accounted for over half of the overall inflation for average consumers last month. And for those in the bottom 30 percent of households, it had a bigger share at 80 percent. 

Thus, our mandate is clear: we must act swiftly to alleviate this burden that disproportionately affects the vulnerable population.

By slashing the tariff on imported rice from 35 percent to 15 percent, we anticipate an average of 10 percent reduction in retail prices for the rest of the year.

This could lower the price of rice by at least 5 pesos per kilo. From an average of 54.40 pesos per kilo last June, prices could go down to below 50 pesos as early as August.

The inflation rate for June is already encouraging, which dropped to 3.7 percent. We contained it within our target and this is way below the median estimates of private analysts.

The lower rice tariff will help reduce the overall inflation rate for the year to an average of 18 percentage points, from 3.5 percent to 3.3 percent.

And while this could entail revenue losses for the government amounting to 9.2 billion pesos for the rest of 2024, in the bigger picture, this improves the welfare of households especially the poor.

Had we not taken this step, rice prices would have remained above 50 pesos, causing significant pain for consumers.

A sustained high price of rice could continue to drive inflation, delaying the reduction of policy interest rates by the BSP and derailing the country’s economic growth trajectory.  

But rest assured, this short-term solution is in tandem with our long-term goal of boosting agricultural productivity.

To support our farmers’ needs and improve local production and competitiveness, we are actively working with Congress to ensure that we have sufficient revenues to support the planned increase of the Rice Competitiveness Enhancement Fund.

We are also continuously increasing our investments in the agriculture sector. In fact, this year’s budget for the sector grew by 27.7 percent to 221.7 billion pesos.

These will enable us to install more irrigation systems, construct farm-to-market roads, procure agri machinery and equipment, and prioritize research and development. 

All these will set the stage for a modernized agriculture sector, transforming it into a principal engine that drives national growth.

Meanwhile, our main job at the Department of Finance is to ensure ample resources to fund our nation’s HEARTS: Health; Education; Agriculture; Roads and Infrastructure; Technology; and Security and Social Protection.

We will be stretching every peso to deliver a bigger bang per buck, especially in investing in our physical and intellectual infrastructure.

The largest chunk, or about 37 percent, of the 5.767 trillion peso-2024 national budget is allocated to education, health, and social protection programs.

Education remains our top priority with an allocation of 928.2 billion pesos.

We are also spending about 567.4 billion pesos in social protection programs like ayuda. These include the 4Ps; livelihood and emergency employment assistance; housing, education, and medical support; and assistance to individuals in crisis situations.

All these will ensure that Filipinos are not just healthy, but are thriving and among the brightest workforce in the world.

By recalibrating our growth and fiscal targets, we are taking proactive steps to ensure that they are attainable, realistic, adaptive to external challenges, and supportive of sustainable growth.

Since fiscal goals are anchored to growth targets, setting high GDP targets amidst external headwinds risks revenue shortfalls. This would strain our deficit and potentially increase borrowing.

But tempering these targets does not diminish our commitment to fiscal consolidation. Instead, it reflects a confident and conservative approach to fiscal policy-making.

Over the medium term, we anticipate a 10.3 percent average annual growth in total revenues to support our people’s growing needs, reaching 4.27 trillion pesos in 2024 to 6.25 trillion pesos by 2028.

Tax collections are projected to increase by an average of 11.8 percent annually. This is faster than the 8.8 percent projected growth of our nominal GDP. 

In fact, for 2025, we expect double-digit collection growth from the BIR and BOC as we enhance their administrative efficiency through digitalization and plug leakages in the tax system, especially from e-commerce.

While no new tax proposals are on the table, refined revenue reforms await congressional approval. These reforms promise fairness and efficiency, ensuring that they do not translate to unnecessary burdens to Filipino consumers and taxpayers.

Upon passage, these reforms could additionally inject an average of 42 billion pesos annually into our coffers beginning in 2025.

We are also strategically maximizing our non-tax revenues to increase collections and ensure sustainable funding for priority programs and projects.

This includes dividends from GOCCs, which we target to collect 100 billion pesos in remittances by the end of this year.

We are also targeting to raise another 42 billion pesos from the privatization of government assets, such as its shares in private companies and public offices in prime locations.

Along with preventing wasteful expenditures, these strategies will help keep the deficit in check and reduce sustainably to only 3.7 percent in 2028.

At the same time, the economy will continue to outgrow the country’s debt with the debt-to-GDP ratio dropping to 56 percent in 2028. This will ensure that we have the ability to pay for our obligations. 

Another key aspect of our growth strategies is investing in high-impact sectors through stronger collaboration with the private sector.

Recognizing their indispensable role in driving long-term growth, we partner closely with them to bring in investments and technology, create high-quality jobs, and spur industry development.

This approach empowers the government to allocate resources effectively while harnessing the private sector’s expertise to expedite infrastructure projects and service delivery nationwide.

Through strategic reforms like the PPP Code, we have streamlined regulations and eliminated barriers to facilitate faster and more efficient partnerships with them. 

Secretary Go has been leading the charge on this and has already elaborated on our investment initiatives in his speech earlier.

We have also been personally engaging with investors to address their key concerns, demonstrating our responsiveness to their needs.

In fact, the economic team and other cabinet secretaries just came back from Japan, where we garnered strong interest from major Japanese manufacturing firms. Incidentally, the majority of them are already happily situated in Batangas.

They are very eager to expand operations in the country and invest in a wide range of areas like infrastructure, energy, agriculture, manufacturing, and ICT. 

We will soon witness and experience the results of every effort, every policy decision, and every investment commitment we have secured.

All these are designed to ensure a more comfortable life for all, lifting 14 million Filipinos out of poverty by the end of the President’s term.

These are all meant to build an inclusive economy that secures the future of every Filipino child. 

It will be an economy with a more secure base of food production, a more efficient logistics backbone, and a more responsive healthcare system.

It will be a Bagong Pilipinas that every Filipino rightfully deserves—one that the next generation will proudly inherit.

And with this, I call upon EJAP—the most competent section of our journalistic community—to continue its fair and insightful reporting on the Philippine economic story.

We may agree and disagree on many things, but our common goal remains: to build a better country and widen public economic literacy. As the evangelists of modern economic thinking, you play a critical role in helping us get there.

Rest assured, the Department of Finance is ready to listen and provide you with the latest data and insights into our policy horizons. Let us keep our channels of dialogue open and active.

Maraming salamat po at mabuhay kayong lahat!

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