Eased forex rules to take effect this year

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) is expected to release its final circular on eased foreign exchange (FX) rules this year to attract more foreign investments into the country, a Monetary Board member said yesterday.

Anita Linda Aquino said the final circular is now taking shape, with the custodian banks currently being consulted by the BSP about the matter.

In January, the BSP released a draft circular that would further relax its rules and regulations governing FX transactions.

“Trust me, it will be finished this year,” Aquino told reporters on the sidelines of the ING Manila Economic Forum 2024 in Taguig yesterday.

Aquino said the market should expect additional waves of FX reforms to “unfold” in the coming months as the BSP prepares to ease rules and regulations.

“I recommended late last year the lifting of the Bangko Sentral registration document, the BSRD, for foreign portfolio investments,” she said in her keynote speech.

“I understand that the custodian banks have already been consulted and I can sense the disbelief that something like this is feasible. The possibilities are now endless, especially for those processes that have outlived their purpose,” she added.

The BSRD is a document issued by the BSP that certifies the registration of foreign investments of non-residents.

Aquino said the comments of the industry would be taken into consideration in the issuance of the final circular.

Under the draft circular, the BSP plans to waive the charge on the registration of foreign, foreign currency loans, inward investments and other foreign exchange transactions.

On the sale of foreign exchange for non-trade current account transactions of residents with non-residents, the BSP may allow the sale of foreign exchange by authorized agent banks without need for prior central bank approval, to cover payments for non-trade current account transactions.

Furthermore, authorized agent banks can now sell foreign exchange to non-resident tourists and balikbayans to the extent of the amount of FX shown to have been sold for pesos by the non-residents to banks.