Palace says US downgrade is ‘wake-up call’

MANILA, Philippines—The Philippines said Saturday the downgrade of the US’ credit rating by Standard & Poor’s would serve as a “wake-up call” but that it was confident the world’s largest economy could address its problems.

President Benigno Aquino’s spokesman Ricky Carandang told Agence France-Presse, “In a way it’s a wake-up call for the US to begin to seriously address its economic issues. We’re confident they will be able to do this.”

He added that the country was closely monitoring the US debt crisis after Washington lost its top-notch AAA credit rating for the first time ever, but that it was too early to tell what the effect would be on Manila.

According to US Treasury data, the Philippines holds $23.6 billion in US securities, now rated AA+ by S&P with a negative outlook.

The United States is also its top export market, main provider of foreign military aid, and a key host for the Philippines’ nine million-strong overseas workers.

A presidential spokeswoman, Abigail Valte, said on government radio that Aquino’s top economic advisers were closely watching the potential fallout.

“The economic managers are closely watching the developments. It is too early to tell what the impact will be. We will take the necessary steps to address this,” Valte added.