MANILA, Philippines ? The Philippine economy is in better shape than most of its neighbors and the country should hit the low end of its 3.7-4.7 percent growth target this year, helped by continued albeit slower inflows of foreign exchange remittances from overseas Filipinos, Standard & Poor's said Tuesday.

Record-high foreign reserves and an external payments position that remains in surplus would help keep the Southeast Asian country on stable ground despite the global downturn, S&P said.

However, weak revenue collection and delays in passage of the government's 2009 budget could trip up a proposed economic pump-priming program this year, said Agost Benard, associate director for sovereign ratings at S&P.

"The Philippines actually looks less vulnerable and its rating more stable than is the case for many other countries in the region," Benard told Reuters.

"We currently do not see any reason for changing the ratings on the Philippines, and that is clear from the stable outlook attached to it."

S&P affirmed its "BB-" rating on the Philippines' foreign-currency sovereign debt, three notches below investment grade, last April.

London-based credit rating group Fitch rates Philippine sovereign debt at two notches below investment level and US-based Moody's has it at four rungs below.

At the end of 2008, the Philippines accumulated record foreign reserves of $37.059 billion despite its aggressive defense of the weak peso, helping to keep its balance of payments (BoP) at a surplus of around $500 million.

While the estimated end-2008 BoP surplus fell to a four-year low and is expected to shrink further this year, the deterioration is not worrisome, Benard said.

"The current account and the balance of payments are still in surplus and the reserves position continues to improve ? it reached a record high last year when most other countries lost a lot of reserves," he said.

Benard said the Philippines would continue to be an attractive investment as long as the BoP remained in surplus.

Monthly remittances of more than $1.0 billion from Filipinos working and living abroad are expected to support the surplus. However, the central bank has forecast growth in remittance inflows would slow to about 6.0 to 9.0 percent this year from 15-percent growth in the first 10 months of 2008.

"Our view is that there is not going to be a collapse in remittance inflows to the Philippines, although a slower pace of growth seems likely," Benard said.

Remittances help fuel consumption and boost economic growth. The government expects growth to hit 3.7-4.7 percent this year from an expansion of about 4.6 percent in 2008 and a 31-year peak of 7.2 percent in 2007 ? respectable given recessions in big developed economies.

Benard said the high end of the government's growth goal was "too optimistic" but the low end looked manageable especially if Manila's plan to spend more on infrastructure and social services was delivered in time.

The additional spending, expected to widen the budget deficit to P102 billion ($2.2 billion) this year from an estimate of about P75 billion in 2008, was an appropriate policy response but it should be supported by reforms in revenue collection, he said.

"The key issue for the Philippines is to have a sufficient revenue base so that pump-priming can be financed without putting a strain on the debt burden."

The Philippines last week raised $1.5 billion in a 10-year global bond sale ? the first Asian offshore sovereign issue this year ? to help finance a 14-percent rise in its 2009 budget and protect economic growth.