Japan agency upgrades PH credit rating to BBB+

Japan's Rating and Investment Information, Inc. (R&I) has upgraded the Philippines' credit rating from 'BBB' to 'BBB+', marking a significant step towards the country's goal of achieving a single 'A' rating by 2022.

The upgraded 'BBB+' rating comes with a 'stable' outlook, indicating no immediate risks of a downgrade.

Finance Secretary Carlos Dominguez III welcomed the upgrade, stating it was 'overdue' and a testament to the positive trends under the Duterte administration, including declining poverty and unemployment, and substantial investments in infrastructure and human capital.

Dominguez highlighted that higher credit ratings benefit both the government and private sector by lowering borrowing costs, which in turn can lead to lower interest rates for ordinary Filipinos and stimulate investment and job opportunities.

Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno affirmed that the upgrade keeps the Philippines on track with its 'Road to A' agenda, a government initiative aimed at securing an 'A' scale rating.

Diokno expressed confidence that achieving an 'A' scale rating from R&I and other debt watchers within two years is attainable, citing improvements in macroeconomic conditions, a favorable inflation environment, and a sound financial system.

He emphasized the importance of continuous effort from all government agencies to maintain this trajectory, with the BSP committing to sound monetary policy, banking supervision, and efforts to ensure a stable financial system.

The favorable assessment from Japanese credit rating agencies is crucial for the Philippines, especially given its strategy to diversify financing sources through Samurai bonds issued in the Japanese market.