The Japan Credit Rating Agency (JCRA) affirmed on Monday (Sep. 6) the Philippines’ “A-“ credit rating with a stable outlook.
In a statement, the JCRA pointed out that the ratings mainly reflect “the country’s high and sustainable economic growth performance underpinned by solid domestic demand, its resilience to external shocks supported by an external debt kept low relative to GDP and the accumulation of foreign exchange reserves, the government’s solid fiscal position, and a sound banking sector.”
The agency said that the government has been “swiftly implementing adequate measures such as increased public health-related expenditures, acceleration of vaccination and continuation of employment program by drawing upon its relatively strong fiscal position before the pandemic” despite the delay of the economic recovery due to the COVID-19 pandemic.
According to the debt watcher, the Philippines has sound macroeconomic fundamentals and its economy can further develop once the COVID-19 crisis has ended.
“JCR does not consider that the fiscal soundness will be impaired because while the fiscal deficit has widened, the support package at this time is backed by appropriate fiscal policies and the government debt will remain comparatively subdued,” the agency said.
It said the Duterte administration’s “centerpiece infrastructure development program has not been retarded even amid the prolonged pandemic,” while the legislation proposals including tax reforms “have been steadily progressing backed by the administration’s high performance and trust ratings.”
“Remittances from workers abroad remain solid and the Philippine economy stays highly resilient to external shocks even amid the deteriorated global economic conditions,” it added.
Report from Naomi Tiburcio/NGS- bny
