Department of Finance (DoF) Secretary Frederick Go said the rating affirmation is expected to reinforce investor confidence and support the government’s efforts to attract high-value investments and sustain economic growth.
Strength of economic reforms recognized
“R&I’s affirmation of the Philippines’ A-rating and Stable outlook recognizes the government’s fiscal consolidation efforts and the strength of our economic reforms,” he said. “This reinforces confidence, supports access to better financing, and helps attract quality investments that create jobs and expand economic opportunities for Filipinos.”
The Bangko Sentral ng Pilipinas (BSP) likewise welcomed the affirmation as a reflection of the country’s economic fundamentals. Said BSP Governor Eli Remolona Jr.,“This reflects the country’s sound macroeconomic fundamentals amid global uncertainties.”
“The country’s resilience is supported by a sound banking system, an efficient payments system, and a healthy external position,” he added, noting that the central bank will continue working to bring inflation down to its 3 percent target.
Economic growth recovery
R&I expects economic growth — which slumped to 2.3 percent in the second quarter — to recover as infrastructure budget execution returns to normal levels. It considered recent delays in infrastructure spending due to probes into the ‘floodgate’ scandal temporary.
The firm said stronger safeguards, tighter project planning and enhanced monitoring should improve transparency and governance in infrastructure implementation.
Infrastructure spending fell 42.9 percent to P269.4 billion from the same period last year, according to the Department of Budget and Management.
Relatively strong growth performance highlighted
Despite the fourth consecutive quarter of decline, R&I highlighted the Philippines’ relatively strong growth performance compared with other Southeast Asian economies, supported by a diversified economic base that includes tourism, IT-BPM and manufacturing, particularly the semiconductor supply chain.
The rating agency also assessed the Philippines’ external position as manageable, noting that foreign exchange reserves remain adequate relative to imports and that external risks remain limited.
