Italy bullish on posting another record-high trade with PH

Italian Ambassador to the Philippines Marco Clemente is looking forward to another record-high bilateral trade between the two countries this year.

Clemente told the Philippine News Agency (PNA) Tuesday that bilateral trade between Italy and the Philippines in 2022 reached EUR1.24 billion, surpassing the amount of trade pre-pandemic.

In 2019, two-way trade amounted to EUR1.09 billion.

“Bilateral trade ties between Italy and the Philippines have never been better,” he said in an interview.

Year-on-year, trade between the two countries increased by 23.9 percent, with Italian exports to the Philippines went up by 21.5 percent while Philippine exports to Italy jumped by 29.1 percent.

BSP amends CRPP rules to help address depreciation of peso

The Bangko Sentral ng Pilipinas (BSP) has widened the coverage of the Currency Rate Risk Protection Program (CRPP) to help address depreciation of the peso by easing pressures on the foreign currency spot market.

In a statement, BSP Governor Felipe Medalla said lessons from the peso’s weakness against the United States dollar last year “show that spillover of risks is inevitable in an increasingly global and interconnected world.” greatly affected the local currency, among others, in 2022.

In Circular No. 1172 issued on April 18, 2023 and signed by BSP officer-in-charge Chuchi Fonacier, the BSP said its policy-making Monetary Board (MB) approved the amendments in the CRPP facility implementing guidelines last March 30.

“Trade is still skewed toward Italy. We have trade surplus of EUR360 million, but the previous figures clearly show that the Philippines is catching up,” Clemente said.

With the coronavirus disease 2019 (Covid-19) restrictions being lifted, the Italian envoy is optimistic about better trade figures this year.

“Hence as the peso stabilizes, we find this an opportune time to strengthen Filipino resilience. The CRPP had to be revamped to increase its availability to banking clients. We did this by streamlining and easing the requirements and expanding the coverage of eligible FX (foreign exchange) transactions,” he said.

Volatility in the global financial market due in part to the recovery of economies from the pandemic, geopolitical concerns overseas, the elevated inflation rate worldwide and the path of policy rates of central banks

The CRPP facility is a non-deliverable peso-US dollar forward contract between the BSP and the universal and commercial banks (U/KBs) that allows bank clients to hedge their foreign currency obligations or transactions to address foreign currency fluctuations and lock the exchange rate to a determined rate.

The BSP said documentary requirements for the facility have been “aligned with the existing regulations on FX transactions and have eliminated the notarial rules to enable expeditious applications.”

The new rules now accept non-trade transactions and investments from the original trade-related coverage as eligible