Philippines Seeks Improved Credit Ratings through Fiscal Reforms

As the country continues to implement its fiscal reforms, the government is optimistic that these efforts will lead to improved economic conditions, higher credit ratings, and increased access to international credit opportunities. The recent upgrade of the Philippines' credit outlook by financial research and analysis firm Moody's Investors Service has boosted authorities' confidence in their economic policies. Department of Finance Secretary Margarito Teves emphasizes the importance of sustained implementation of reforms, citing the country's improving fiscal status as a positive signal to local and foreign investors.

Key Takeaways:

• The Philippine government aims to improve its credit ratings through sustained implementation of fiscal reforms, including strengthened tax collection and macro-economic fundamentals.
• The credit rating upgrade by Moody's Investors Service from negative to stable is expected to improve investor confidence and increase access to credit opportunities for national and local governments, as well as private companies.
• The government is projecting a 5.5 to 6.5 percent growth rate for the country next year, which is expected to be supported by additional credit opportunities and economic activities.
• Sectors criticizing the government's fiscal reforms for allegedly failing to improve socio-economic conditions nationwide were acknowledged by Teves, who assured that results of fiscal reforms will be felt up to the grassroots level through infrastructure projects and social services funded from additional public revenues.
• The government has announced a P370 billion (US$7.4 billion) infrastructure program for 2007-2010, aimed at boosting development in key regions.

Statistics:

• The Philippines' credit outlook was upgraded by Moody's Investors Service from negative to stable.
• The government aims to achieve a 5.5 to 6.5 percent growth rate for the country next year.
• Over 3 million Filipinos were reported to be experiencing hunger in the 2006 third quarter, while over half of respondents considered themselves poor (Social Weather Stations).
• The government proposes a P370 billion (US$7.4 billion) infrastructure program for 2007-2010.

Sources:

• "Moody's Investors Service hails Philippines' fiscal status" (Margarito Teves, Department of Finance Secretary, cited in Asia Pulse)
• "Social Weather Stations reports of hunger and poverty in the Philippines" (Social Weather Stations, cited in Asia Pulse)
• "Philippines to implement P370 billion infrastructure program" (PNA)