American credit watcher Fitch Ratings was impressed with the “very strong” macroeconomic story of the Philippines and gave it an upgraded outlook.
The Philippines is now a step closer to the coveted “A” rating after it received a “positive” or “BBB” credit score from Fitch.
“The macro story of the Philippines is very strong and it has stayed intact. Also, to add the infrastructure program of the government that still remains on track,” said Fitch’s Associate Director of Asia Pacific Sovereigns Sagarika Chandra.
According to reports, an “A” rating is crucial to the Philippine government’s quest for inclusive growth as the upgrade will widen the market for bonds and will lower interest rates for loans. This will ultimately have huge impacts on investments, domestic expansion, and job creation.
Chandra challenged the Philippines to maintain its strong performance in the macroeconomic front and strive to lessen its debt to GDP ratio to achieve the A-level credit rating.
She said that Fitch also expects the country to reach 6.4 percent and 6.5 percent acceleration growth for 2020 and 2021, respectively.
In an article posted in the Philippine News Agency, Finance Secretary Carlos Dominguez III said they have been working for this as well as for the continued improvement of domestic fundamentals through investment initiatives and maintained fiscal discipline.
“The Philippines looks forward to the further alignment of its credit ratings to its level of creditworthiness as indicated by a decreasing debt-to-GDP (gross domestic product) ratio and positive economic prospects from record investment levels in infrastructure and human capital,” he said.
Economic leaders said they hope to attain the A-level credit rating before President Rodrigo Duterte’s term ends in 2022.