Fitch Ratings’ reaffirmation of the country’s credit rating is a vote of confidence for the Philippines and highlights the country’s strong economic fundamentals, Finance Secretary Ralph Recto said Wednesday.
In a statement, Recto also said the reaffirmation of the “BBB” credit rating also “underscores the strength of our economic fundamentals, the credibility of our ongoing reforms, and our resilience in navigating global headwinds — all while maintaining robust growth.”
“We remain committed to sustaining this trajectory through sound fiscal management and an open, investment-friendly environment that invites and welcomes partners from around the globe,” he said.
Fitch Ratings on Tuesday reaffirmed the Philippines’ “BBB” credit rating with a “Stable” outlook, citing the country’s strong medium-term growth potential.
A “BBB” rating, which is above the minimum investment grade, indicates the Philippines’ strong creditworthiness.
Over the medium term, Fitch expects economic growth to exceed 6 percent, more than double the projected “BBB” median, as the Philippine economy reaps the benefits of structural reforms and strategic investments.
Fitch likewise acknowledged the government’s progress in fiscal consolidation, with general government (GG) budget deficit narrowing and the GG debt-to-GDP ratio on a downward path.
However, Fitch cautioned that risks to growth remain, particularly from domestic political uncertainty and global trade tensions.
Technological change likewise poses risks to the Philippines’ large outsourcing sector, but Fitch noted that the country is adapting well.
Recto assured that the country is “ready to respond to these risks with agility and resolve — through forward-looking reforms such as the CREATE MORE Act and strategic investments in innovation and human capital.” (PNA)
