#ThoughtLeaders | Former BSP governor and finance secretary Benjamin Diokno weighs in on the Philippines’ economic challenges — from the flood control corruption scandal and weakened public confidence to the quality of government spending, rising ayuda allocations, and delayed infrastructure projects. Diokno also discusses inflation, oil price risks, the BSP’s role during crises, and why President Marcos’ next SONA may be a “moment of truth” after his “Mahiya naman kayo” warning. #OneNews #LongConversation
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What Benjamin Diokno said
Written from the verified transcript and checked against it. Every figure links to the moment it was said.
Benjamin Diokno, a Monetary Board member and former BSP governor, said the current oil shock is manageable compared to the pandemic, predicting a supply glut within six months to a year as Iran, the UAE, and U.S. sources add over 5 million barrels per day. He called the flood control corruption scandal worse, citing a 31.5% contraction in construction in Q1 and eroded investor confidence. He argued for sustained infrastructure spending of 5-6% of GDP, criticized the shift to 'ayuda' in the budget, and noted the medium-term expenditure framework targets (3% deficit by 2028, 60% debt-to-GDP) have been missed, with debt at 65.2% and deficit at 5.3%. He blamed the president for not using line-item veto power, urged immediate cuts to LPG and kerosene excise tax suspensions, and stressed the need for 6% growth over the next decade.
Key takeaways
Predicted oil supply glut within six months to a year, with over 5 million barrels per day from Iran, UAE, and U.S. sources.
Called flood control scandal worse than oil shock, citing 31.5% Q1 construction contraction and eroded confidence.
Said infrastructure spending should be 5-6% of GDP, but current budget prioritizes 'ayuda' over projects.
Recommended immediate end to LPG and kerosene excise tax suspension due to fiscal slippage.
Numbers and commitments
Figure
What it refers to
Type
At
5 million barrels per day
additional oil supply forecast from Iran, UAE, and U.S.
0:52What's it like being a monetary board member given that we're facing twin shocks right now?
3:03That supply glut aside, do you give some sense of comfort to the Monetary Board that you just said this is nothing compared to the pandemic?
3:16But if you compare the oil shock with the flood control corruption scandal, what is worse?
5:01And after the scandal, with stricter payment validation, how do we get beyond that when trust has already been broken?
6:34Now, is growth a bigger concern for you than inflation?
7:35Looking back at the president's State of the Nation address last year where he said he would not tolerate corruption, what is your assessment a year on?
8:41So how can he walk back when he takes the stage again on July 27?
9:11As an economic planner, what have you done to align with the president's cleanup?
His government journey spans four decades across budget, central banking, and finance under four Philippine presidents. He is a former BSP governor and finance secretary who now sits as a full-time member of the Monetary Board. He joins us at a moment a Middle East shock is threatening the Philippines' hard-won human development gains, and as a flood control corruption scandal raises questions about how public money is spent, how trust is protected, and how economic policy can still work under stress. With us now on Thought Leaders, Bangko Sentral Monetary Board member Benjamin Diokno. So good to see you, MBM.
All right, that covers the career span that you've had. What's it like being a monetary board member given that we're facing twin shocks right now? There's the oil shock and also the economic after-effects of the flood control corruption scandal.
To me, being the governor during the pandemic, this is nothing. I was governor during COVID-19, so this is nothing. If you compare oil prices, during the first OPEC shock under Marcos Sr., the price should have been $300–400 per barrel. Right now, it went up to 120 at its peak. My forecast is a supply glut in the medium term: Iran will add half a million barrels per day, the UAE has an extra million and is leaving OPEC, and new U.S. sources will bring another 2.8 million barrels per day. So easily 5 million more barrels per day will come on stream. On the demand side, electric vehicles are gaining ground and China has stopped buying oil for inventory. I think there will be an oversupply within six months to a year.
That's worse. The flood control shock means loss of confidence. Credibility is very important. Also, construction contracted by 31.5% in the first quarter, and I wouldn't be surprised if it contracts more in the second quarter. Things are not moving. Infrastructure was my focus during the Duterte years because for 50 years we spent less than 2% of GDP on it. I said we should set aside at least 5–6% of GDP for infrastructure, which is why we have projects like the Manila subway and the north-south rail system. We should continue that for the next 20 years.
Should continue, but when you look at the DBM forecast, it's at 4.3% of GDP for infraspend. And after the scandal, with stricter payment validation, how do we get beyond that when trust has already been broken?
This is the major challenge for the new DPWH secretary. He told the bureaucracy they're no good, so trust is eroded. People fear signing documents. I foresee projects will start moving by the first quarter of next year because procurement is tedious. The loss of confidence in domestic and foreign investors will slow economic growth.
I think we have to continue to grow—maybe 6% for the next 10 years. That's possible if we make major changes in the economy, like fixing the bureaucracy. Leadership should be fully committed to strong growth without worrying about politics or who will succeed them.
Looking back at the president's State of the Nation address last year where he said he would not tolerate corruption, what is your assessment a year on?
17 more exchanges in this transcript
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Diokno, B. (2026, July 2). Ben Diokno on ayuda, flood control, inflation, and PH growth | Thought Leaders with Cathy Yang [Interview transcript]. One News PH. CEOInterviews.AI. https://ceointerviews.ai/interview/1055784/
MLA
Benjamin Diokno. "Ben Diokno on ayuda, flood control, inflation, and PH growth | Thought Leaders with Cathy Yang." One News PH, 2 Jul. 2026. Transcript, CEOInterviews.AI, https://ceointerviews.ai/interview/1055784/.
BibTeX
@misc{diokno2026_1055784,
author = {Benjamin Diokno},
title = {Ben Diokno on ayuda, flood control, inflation, and PH growth | Thought Leaders with Cathy Yang},
howpublished = {Interview transcript, One News PH. CEOInterviews.AI},
year = {2026},
month = {jul},
url = {https://ceointerviews.ai/interview/1055784/},
note = {Speaker-attributed transcript with timestamps}
}
