The most anticipated credit
rating upgrade for the Philippines has been finalized. Although it is expected because
the Philippines has already received an investment grade rating from Fitch last
March and it was followed with another from Standard & Poor’s later in May.
And so last Thursday (3 October 2013) the last major debt-watcher, Moody’s,
granted and raised the Philippines’ investment grade status to a Baa3 rating
with a positive credit outlook.
Although the “Baa3” rating is the
lowest in the investment grade ratings, yet it is well enough to place the
Philippines’ economic performance on par with Turkey and Spain. And it is also considered
a critical milestone in lifting the country’s economic status from one of
Asia’s weaker economies which was once even considered “the sick man of Asia”.
And the economic growth of 6.8 percent last year and 7.6 percent in the first
half of 2013 are among the highest in Asia-Pacific and remained one of Asia’s
best performers.
According to Moody’s, “The
Philippines’ economic performance has entered a structural shift to higher
growth, accompanied by low inflation.”
With three investment
rating upgrades in succession, it only means one thing to the Philippines, a
good image with a brighter outlook to the eyes of the investors. And with the
badge of credit worthiness, it also reflects the confidence of the
international community with regards to the strength of the Philippine economy.
Many believe that there might be another upgrade in the coming years before
2016, the time when the current President steps down. And so what’s this latest
credit rating upgrade means to the Philippines?
An improving
credibility to the international community.
This post has been posted at "It's All About Seth" which is my wife's blog and I am reposting it here to have more exposure. Image from Rappler.com
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