Gov’t pushes bid to get rating upgrade
Government economic managers on Wednesday expressed confidence in the government’s achieving investment-grade credit rating this year as they further advance reforms and what they described as mounting investor confidence in the country.
“There is very little doubt that the country will soon reach investment grade,” Budget Secretary Florencio B. Abad said. The government’s economic team on Wednesday held at the Philippine International Convention Center in Pasay City a yearend economic briefing for the country’s performance in 2012.
“We are determined to create an environment that will not only facilitate the upgrade, but will likewise ensure the sustainability and inclusiveness of the country’s growth,” Abad said.
This year’s briefing harped on keeping the momentum of 11 positive credit actions on the Philippines’ long-term foreign currency rating by the three major agencies since President Aquino assumed office in 2010.
Moody’s Investor Services, Fitch Ratings and S&P Ratings Services now place the Philippines a notch below the coveted investment-grade rating.
“We have a very good chance of getting investment grade from at least one major agency this year,” Trade Secretary Gregory L. Domingo.
Domingo noted that the government’s “sustainable and visible efforts” have resulted in improvements in the country’s competitiveness as reflected in the most recent World Economic Forum Competitiveness Report, where the Philippines ranked 65th, or 20 notches better than the previous year’s slot.
“Good governance has led to a strong external payment environment and fiscal position, improving asset quality and credit in the banking system, benign inflation, a stable peso and meaningful policy reform,” Finance Secretary Cesar V. Purisima said.
On the administration’s fiscal strategy and key reforms, Abad said public expenditure was expected to boost economic growth as spending would be faster and more efficient.
He said social programs and infrastructure development, which respectively grew by 50 percent and 57 percent as of November 2012, would continue to drive output expansion.
“Achieving investment grade will result in improvements in our risk profile as well as cement the Philippines’ reputation as a most promising investment destination,” Abad said.
“The result [is] greater private sector confidence in the country’s economic and political capacity, more jobs, and a country of empowered citizens who finally have direct access to the benefits of good governance,” he added.