Standard and Poor’s (S&P) has upgraded its growth forecasts for the Philippines for 2016 and 2017 as it continues to see the economy remaining an outperformer in the region.
Based on the debt rater’s Jan. 10, 2017 report, it now sees a 6.6 percent growth for the domestic economy for 2016 and 6.4 percent output this year.
These were previously at 6.5 percent and 6.3 percent based on the credit rater’s report in November 2016.
The 2018 forecast was maintained at 6.2 percent and the debt rater also announced its 2019 growth forecast, which is an print of 6.3 percent.
S&P has an investment grade rating of ‘BBB’ for the country, with a Stable outlook.
It elevated the country to investment grade in May 2013, with a rating of “BBB-” after noting the improvement in the country’s external profile, slowing inflation, and less reliance on foreign sources to funds its programs.
It hiked a notch the investment grade the following year after citing that reforms in the structural, administrative, institutional and governance areas have the ability to be sustained in the future.
“The stable outlook balances the Philippines’ lower middle-income economy and diminished policy stability, predictability, and accountability against its strong external position, which features rising foreign exchange reserves and low and declining external debt,” the debt rater said in its latest report.
The Philippine economy has been posting higher growth, with the average output now up at over 6 percent from around 3 percent in the past.
In the third quarter of 2016, the domestic economy posted the highest output for the period in the region at 7.1 percent.
This growth, as measured by gross domestic product (GDP), brought the average growth in the first three quarters of last year to 7 percent, the upper end of the government’s 6 to 7 percent target for this year. (PNA)