S&P Global Ratings recently affirmed its ‘BBB+’ long-term and ‘A-2’ short term ratings on the Philippines as it believes the slowdown on public infrastructure spending will be temporary.
Outlook on these ratings remain positive, the credit rater said in a report.
“The government is continuing its fiscal consolidation, with its debt burden stabilizing. The country’s external position remains a rating strength,” it said, but noted that “current account deficits in recent years have decreased net external assets.”
It kept the outlook “positive” as it considers that the country “will maintain its external strength and healthy growth rate, and the government’s fiscal performance will strengthen over the next 12-24 months.”
The affirmation of the ratings was made as the Philippine government digs deep into the anomalies in the flood control projects.
The investigation has resulted in the halting of budget allocation for flood control projects for 2026, with President Ferdinand R. Marcos Jr. citing around P350 billion allocated for this year remains untapped.
This has resulted in the slowdown of domestic growth in the third quarter of this year due to lower government spending.
Growth, as measured by gross domestic product (GDP), slowed to 4 percent from quarter-ago’s 5.5 percent and year-ago’s 5.2 percent.
“However, we believe this will not derail the country’s long-term growth trajectory, which remains healthy,” S&P said.
Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona, in a statement, said the S&P rating affirmation “confirms our view of the favorable long-term economic growth prospects.”
He said the country remains well-positioned against external risks given the $110.2 billion worth of dollar reserves as October 2025, among others.
Finance Secretary Frederick Go said affirmation of the country’s ratings “will ensure that every policy decision will support sustainable growth and long-term stability.”
“Having a high credit rating will benefit Filipinos because this means cheaper financing for the government, and in effect, more resources for essential public services. This supports our goal of uplifting the life of every Filipino,” he said.
PNA PHOTO