Japanese agency upgrades Philippine sovereign credit rating

The Japan Credit Rating Agency (JCR) upgrades Philippine credit rating from BBB to BBB+ with Stable outlook. The said sovereign credit status is one step from the “A” credit ratings. This is the 22nd positive credit rating movement since 2010.

“The upgrading mainly reflects (i) the government’s improving fiscal position, (?) sound external position, (?) generally stable political and social situations and (iv) increased prospects for sustained relatively high economic growth fueled by strong household consumption supported by OF (overseas Filipino) remittances and rising capital investments,” JCR said.

“JCR is of the view that the Philippine economy will, by and large, sustain an annual growth of around 6% in the years to come driven by strong domestic demand,” the rating agency said.

JCR said Philippines fiscal position will continue to improve moderately as the Aquino government is committed to hold the fiscal deficit/GDP ratio within its 2.0% target from 2015 onward through implementation of stronger administrative reforms in the Bureau of Internal Revenue and Bureau of Customs and enhanced tax collection efficiency along with proactive debt liability management.