Former Senator and House Deputy Speaker Ralph Recto Appointed as New Secretary of Finance
On January 11, President Marcos appointed former Senator and Deputy House Speaker Ralph Rector as the new Secretary of the Department of Finance (DOF). Recto will be replacing Benjamin Diokno, who held key positions, including Department of Budget and Management (DBM) Secretary and Central Bank Governor, across 4 administrations.
Recto began his political career in the House of Representatives in 1992. He was a congressman from 1992 to 2001, a senator from 2001 to 2007 and from 2010 to 2022, before being elected again as Congressman in 2022. He was also Socioeconomic Planning Secretary and Director General for the National Economic Development Authority (NEDA) from 2008 to 2009. As a lawmaker, Recto’s reforms focused on economic modifications and poverty alleviation. He enacted several economic measures including the Philippine Economic Zone Law, the Comprehensive Tax Reform Law, and the controversial Expanded Value Added Tax Law, among others. Recto held the positions of Senate Minority Leader, Senate President Pro Tempore, and most recently, House Deputy Speaker. With this new appointment, Recto relinquished his seat as Congressman for the 6th district of Batangas and his role as one of the Deputy Speakers.
As finance chief, Recto will have the responsibility of fostering economic growth in the face of inflationary pressures and the need to bring down the debt-to-GDP ratio. He promised to promote growth while enhancing efficiency by prioritizing tax collections amounting to PHP 4.3 T (~ USD 75 B) with the Bureau of Internal Revenue (BIR), the Bureau of Customs (BOC), and the National Treasury. Guided by the Philippine Development Plan and the 8-point Economic Agenda, Recto assured that there will be no major policy changes and reshuffles in the DOF and that he would instead work on passing pending revenue measures.
Speculations about Recto’s appointment were heightened when he accompanied the President to the 2023 Asia-Pacific Economic Cooperation (APEC) Summit in San Francisco last November. In September, Diokno dismissed rumors on being replaced amid policy differences with the President and his allies, particularly on rice price caps and fuel taxes. In a press conference the day after Recto’s appointment was announced, President Marcos said that Diokno was supposed to retire in the middle of 2023, but the administration asked him to continue. Diokno declined a post in the Maharlika Investment Corporation, managers of the Philippines’ first sovereign wealth fund, and will instead go back to the Bangko Sentral ng Pilipinas as a member of its Monetary Board.
Recto’s former colleagues in the Senate and in Congress, along with other government officials, welcomed the development, citing Recto’s extensive experience in finance policies and his capability to sustain the economic gains that the country has achieved thus far. Others believethat while Recto is not an economist by nature, he is a politician who worked on a lot of economic issues, skillful in rallying other politicians to enact key reforms. For his part, President Marcos is confident that Recto would leverage his influence in Congress to forward legislation meant to expedite economic growth and attract investments. Business groups are hopeful that Recto will continue to push for policies and reforms that are supportive towards businesses. Outgoing Finance Secretary Diokno also expressed his confidence in Recto, citing that the latter will be inheriting a department and an economy that are on solid footing. On January 15, Diokno officially turned over the DOF leadership to Recto. The appointment of a new secretary often signifies an attempt to bring about a change in direction or approach in addressing challenges and issues.
In a span of 3 months, the President appointed 3 new cabinet members: Secretary of Agriculture, Special Assistant to the President for Investment and Economic Affairs, and Secretary of Finance.