It seems things are looking up for the Duterte administration (economically that is) just a few days after President Rodrigo Roa Duterte had his second (2nd) State of the Nation Address, one major credit agency made its vote of confidence in the current administration.
The president made an emphasis that like what he has implemented in the city of Davao, when the there is peace and order ( by low crime rate) investor confidence spikes up. And despite the declaration of this administration’s war against illegal drugs, and the somewhat a clear path( or lack thereof) with respect the country’s economic plans in the next five (5) years- a good news about the Philippine economy has just been made known by one of the big three(3) Credit rating agency- New York and London based-Fitch Ratings.
|Fitch Ratings Inc. is one of the "Big Three credit rating agencies", dual-headquartered in New York, USA, and London.( photo credit to the owner)|
According to the Asia Pacific Sovereign Overview 3Q17, Fitch ratings said that the Philippines gross domestic product (GDP) will likely grow by 6.6 percent on average in the next five years.
That the country was able to experience growth without “imbalances and maintenance of external buffers that are resilient to potential negative external developments.”
The credit agency expects the country to sustain its economy growth momentum for this year at 6.8% and 6.7% next year(2018).
It took note of the country’s “strong external position with current account surpluses, high levels of international reserves, and low and declining external debt.
One of the flagship project of the Duterte administration is the so-called “Golden Age of Infrastructure” where it targets to spend P847 Billion on infrastructure development in all of the regions in the country which will include small-, medium- and large-scale ventures to meet an infrastructure spending-to-GDP ratio of 5.3 percent.
“The Philippines remains a net external creditor and, at 13.3 percent of GDP, this is stronger than the net debtor position of the ‘BBB’ median peers, supporting its external profile,” the credit watchdog said.
In the first quarter (1stQ) of this year, Fitch affirmed the Philippines’ “BBB-“ investment grade rating and positive outlook, but this was all before the start of the full implementation of the war against illegal drugs and the declaration of martial law in Mindanao- thngs that can really affect the Philippine economy.
“The Philippines’ ratings reflect its continued strong and consistent growth performance, a robust net external creditor position and government debt levels that are lower than the median of peers in the ‘BBB’ rating category,” Fitch said in the 1st quarter of this year.