The Philippines is poised to secure another credit rating upgrade in the next few weeks, the 24th under the Aquino administration, Finance Secretary Cesar V. Purisima disclosed Monday.
In a speech at the 67th anniversary celebration of the Insurance Commission, Purisima noted that under Mr. Aquino, the country has become the most upgraded sovereign in the world, with 23 positive credit rating upgrades during the past five years.
“And I heard that in the next few weeks, there will be another upgrade coming up, bringing it to 24,” Purisima said.
The Finance chief later told reporters that he was “hoping” for a credit rating upgrade soonest.
“I’m just hoping; I’m always hoping. If you look at the fundamentals, the external position is very strong. The overall macro environment is strong. BPO (business process outsourcing) and remittances are strong. I said we’ve had 23; I’m hoping for 24. What I believe in is the strong fundamentals of the country,” Purisima said.
To date, the Philippines’ credit ratings from the top three debt watchers are one or two notches above investment grade.
As of April last year, Standard & Poor’s placed the Philippines at “stable” at BBB; while Moody’s Investors Service’s rating for the Philippines was “stable” at Baa2 last December.
Meanwhile, Fitch Ratings had the country at BBB- “positive” in September. A “positive” rating meant that an adjustment would be likely during the short term.
Credit ratings are a measure of a government’s creditworthiness.
As the stability of state finances is also related to a country’s performance, credit scores serve as a proxy grade for the economy.
Improved ratings also allow the government to demand lower rates when it borrows from lenders.
This could translate to lower interest rates for consumers and businesses borrowing from banks using government-issued debt paper as benchmarks for their loans.