MANILA – Stalwarts of the Philippine Stock Exchange (PSE) on Thursday welcomed Standard & Poor’s (S&P) Global Ratings’ affirmation of the country’s “BBB+” long-term and “A-2” short-term sovereign credit ratings, calling the move “a flicker of light” amid a gloomy world economy.
The latest rating by New York-headquartered S&P came at the heels of the “BBB” rating by another American credit rating agency, Fitch Ratings, which effectively kept its “stable” outlook for the Philippines earlier this month.
In an interview, Astro del Castillo, managing director of First Grade Finance, called S&P’s steady ratings on the Philippines “another feather in the cap” of local economic managers and private sector drivers of the financial sector.
“The fact that we (the Philippines) can maintain our position when many developed economies are down is already an achievement. It shows that economic management is being done right and that investors have reason to remain optimistic,” he said.
Del Castillo, a veteran market analyst, cited the case of the United States, which was downgraded by two influential rating agencies this year.
Moody's on Nov. 10 lowered its outlook on the US’ credit rating to "negative" from "stable", citing large fiscal deficits and a decline in debt affordability, a move that drew immediate criticism from the White House.
In August, Fitch downgraded America's Long-Term Foreign-Currency Issuer Default Rating (IDR) to "AA+" from "AAA."
Francis Chua, chairman of BA Securities, said “there is cause for celebration” even if a rating upgrade from global rating agencies remains out of reach.
“As long as we are not being downgraded, we should congratulate ourselves. To think that many countries we always believed to be economically stronger than us seem to be in trouble today… we should be thankful. Even the European Union lowered its growth forecast for the 20 countries using the euro to 0.6 percent from 0.8 percent because of high inflation, rising interest rates and weak external demand,” he told the Philippine News Agency.
Chua, also chairman emeritus of the Philippine Chamber of Commerce and Industry (PCCI), said President Ferdinand R. Marcos Jr. and his economic team deserve much of the credit for the apparent financial stability presently prevailing over the country.
In affirming the Philippines' credit standing, S&P highlighted the country's sustained economic recovery due to the government’s ongoing efforts to address infrastructure gaps and improvements in the business climate.
S&P Global Ratings is a division of S&P Global that publishes financial research and analysis on stocks, bonds and commodities, and is considered the largest of the “Big Three” credit-rating agencies, which also include Moody's Investors Service and Fitch Ratings. (PNA)