International watchdogs hail robust PH economy
by FFE PH News staff
The Philippines’ credit rating – which shows its capacity to pay off debts – once again received an upgrade, this time from finance and credit giant Moody’s Investors Service. From an investment-grade of Ba1, the country’s rating jumped a notch to Baa3.
In an announcement on Thursday, Moody’s also said that the Philippines is the “only system worldwide deemed by Moody’s to have a positive outlook.
“The Philippines’s economic performance has … [shifted] to higher growth. Real gross domestic product [GDP] expanded by 6.8% in 2012 and 7.6% in the first half of 2013. These levels are among the fastest rates of growth in Asia Pacific and across emerging markets globally.”
Moody’s said that improved fiscal management, healthy economic performance, ongoing debt consolidation and a generally positive outlook on politics and government helped improve the country’s credit rating.
The company cited the country’s ability to weather out the volatile market following the US’ fiscal problems. It also lauded President Aquino’s leadership, saying “The Aquino administration … [has supported] reforms for good governance … improving assessments of institutional quality and international competitiveness.”
Bangko Sentral ng Pilipinas governor Amando M. Tetangco Jr. welcomed the news and said this may boost a “trickle down” effect that will reach the common Filipino.
“This development should bode well for more investments, both local and foreign, in the country. Greater investments should strengthen the base for sustained and inclusive economic growth and usher in a transformative period for the Philippine economy.”
Finance secretary Cesar Purisima meanwhile said the upgrade was proof of the country’s economic strength and stability. He said the administration will continue to work on increasing investments in infrastructure, as the country is among the “most underrated” in terms of this sector.
Moody’s cites that the economy has been bolstered by remittances and the business-process outsourcing sector, leading the country to have a bigger international reserve as opposed to debts.
The country received credit rating upgrades three times from three major credit watchdogs this year. Fitch Ratings improved the country’s investment-grade status last March, followed by Standard & Poor’s upgrade in May.