PH gets third investment grade rating
MANILA (UPDATED) - The Philippines on Tuesday received its third investment grade credit rating - this time from the Japan Credit Rating Agency Ltd. (JCRA).
In a statement, JCRA said it raised its credit rating for the Philippines by a notch from BBB- to BBB, with stable outlook.
In a statement, JCRA said the upgrade reflects improvements in the Philippines' political stability and fiscal position, as well as robust economic growth.
"JCRA is of the view that the Philippine economy will, by and large, sustain an annual economic growth at around 6 percent in the years to come supported by strong domestic demand," it said.
JCRA also noted the Philippines' resilience to external shocks rendered by the accumulation of foreign exchange reserves. It said the Philippines' current account will remain in surplus, on the back of remittances from overseas Filipino workers and revenues from business process outsourcing companies.
“Its fiscal position will continue to improve moderately as the Aquino government is committed to hold the fiscal deficit/gross domestic product (GDP) ratio within its 2 percent target from 2013 onwards," it said.
"The pattern in which OFW remittances support the balance of payments as well as private consumption is likely to continue in 2013."
However, the rating agency said the Philippines should upgrade its infrastructure and improve the business environment to ensure sustainable economic growth.
"As the uncertainty persists over the prospect of the world economy, especially the European economy, JCRA will closely monitor its future developments and their possible impact on the Philippine economy," it said.