Economic managers laud positive Philippine ratings

MANILA, Philippines –  Economic managers are inspired by the positive assessment from international credit rating agencies as the government pursues major reforms under the Duterte administration.

Finance Secretary Carlos Dominguez said in a statement the continued positive assessment of debt watchers on the Philippines is one more incentive for the government to “go ahead full throttle” on its “Dutertenomics” agenda to sustain the growth momentum and achieve economic inclusion in the medium term.

S&P Global Ratings announced over the weekend it has reaffirmed the country’s “BBB” rating with a “stable” outlook. The rating is a notch above the minimum investment grade, and the outlook indicates likelihood that the rating will stay the same at least over the next 12 to 18 months.

It is the second debt watcher to reaffirm the country’s credit rating after Fitch Ratings retained its ‘BBB-’ or minimum investment grade rating and positive outlook on the Philippines

Dominguez expressed hope the S&P’s affirmation of its “BBB” rating and “stable” outlook on the Philippine economy would “inspire the Congress to act soon enough on the first package of the government’s Comprehensive Tax Reform Program (CTRP).

According to Dominguez, the passage of the tax reform program would help guarantee the financial sustainability of the government’s aggressive expenditure program on infrastructure and human capital development meant to sharpen the country’s global competitiveness and grow its economy into upper middle-income status by 2022.

“S&P has confirmed what international and domestic financial institutions plus the business community and other sectors have been saying all along – that the policy environment on the Duterte watch remains conducive to sustained high economic growth,” Dominguez said.

He pointed out the affirmation is one more incentive for the government to go full throttle on its ‘Dutertenomics’ agenda to sustain the growth momentum and achieve economic inclusion on the President’s watch.

Likewise, he explained the concerns of S&P over downward risks to growth such as uncertainties in export markets and inadequate infrastructure has been addressed by the government.

“These are already being addressed by President Duterte’s rebalancing of foreign policy with a focus on greater integration with our Southeast Asian neighbors and trading partners China, Japan, and South Korea, and our ambitious plan to invest P8 trillion between now and 2022 in closing the country’s yawning infrastructure gap,” he said.

For his part, BSP Governor Amando Tetangco Jr.  said monetary authorities would continue to pursue reforms as part of its mandate to maintain price and financial stability.

“The favorable credit rating actions bestowed on the country over the years by major international credit watchdogs, including the latest affirmation by S&P of the country’s BBB/stable rating, is recognition in part of sound and calibrated monetary policy and banking supervision that have helped steer the economy to its enviable position of strength even amid a challenging external environment,” Tetangco said.

Source: http://www.philstar.com/business/2017/05/05/1696708/economic-managers-laud-positive-philippine-ratings