THE Philippines government’s efforts to improve the economy paid off after an international credit watchdog raised the country’s credit rating.
Moody’s Investors Service recently upgraded the Philippines’ foreign and local bond ratings to Baa2, just a notch bellow investment grade from Baa3, noting that the outlook for the rating was stable.
The upgrade, according to Malacañang Palace, is the ninth within four years of Pres. Benigno Aquino III’s leadership. Presidential spokesperson Edwin Lacierda insisted that this development only proves that the current administration’s philosophy: “good governance is good economics” is very effective.
“With these upgrades comes increased fiscal flexibility, and the Filipino people can be assured that our administration will continue channeling these gains towards the benefit of the broader spectrum of society, as we continue to tread the straight path towards a Philippines that is more prosperous, progressive, and inclusive,” Lacierda said in a statement.
For his part, Budget and Management Secretary Butch Abad believes that the recent achievement is a “reaffirmation of the country’s strong economic fundamentals and its positive growth prospects, even in the face of the past year’s challenges.”
“The Moody’s upgrade can definitely be viewed as an endorsement of the fiscal management and reform policies initiated by the administration. Despite the soft GDP growth last quarter due to government underspending and the recent calamities, Moody’s has deemed these difficulties as temporary problems that the country can overcome,” Abad said.
The upgrade is not because of the government’s effort alone, continued remittances from overseas Filipino workers (OFWs) was also a big contribution to this milestone.
Because of this development, the Philippines would be experiencing lower borrowing cost, more foreign capital inflows, lower interest rates on bank loans and peso appreciation.
Moody’s said that the progress in the Philippine economy is perceived as stable, but for how long? Sustaining this improvement would be a critical endeavor in the coming year.
(AJPress)
