The current ratings remain at “BBB+” for long-term and “A-2” for short-term. An upgraded credit rating would reduce borrowing costs and enhance the country’s appeal to investors.
According to the monetary regulator, S&P attributed the improved outlook to effective policymaking, fiscal reforms, and infrastructure advancements.
The recent passage of the CREATE MORE and Public-Private Partnership (PPP) laws also bolstered confidence in the country’s economic framework. These measures, S&P noted, have sustained strong growth over the past decade.
An improved outlook benefits both the government and private sector by lowering interest rates on loans, enabling expanded services, infrastructure development, business growth, and job creation.
Bangko Sentral ng Pilipinas Governor Eli Remolona, Jr. welcomed S&P’s decision, stating, “This reflects the work the government has done to improve the economic, fiscal, and monetary environment, enabling strong growth to continue. The BSP remains committed to promoting price stability, financial stability, and an efficient payment system to support sustainable economic growth.”
S&P projects a 5.5-percent growth for the Philippine economy in 2024. Recent data from the Philippine Statistics Authority showed a 5.2-percent gross domestic product growth (GDP) year-on-year in the third quarter of 2024, bringing the average growth to 5.8 percent for the first three quarters. The Philippines remains one of Asia’s fastest-growing economies, ranking behind Vietnam but ahead of Indonesia, China, and Singapore.
Inflation eased significantly in 2024, averaging 3.4 percent in the first nine months, down from 6.0 percent in the previous year. The country also maintains robust reserves of $111.1 billion as of October 2024, sufficient to cover eight months of imports.
S&P praised the BSP’s enhanced financial oversight, which has strengthened the banking sector. Philippine banks remain well-capitalized and liquid, with ratios exceeding regulatory and global standards.
S&P last upgraded the Philippines to its current “BBB+” rating in 2019, following earlier upgrades in 2013 and 2014. A move to “A-” would mark a significant milestone in the country’s credit history, the central bank said.
