Phl to push for credit rating upgrade

MANILA, Philippines - Fiscal and monetary authorities are expected to make a pitch for another upgrade from international credit rating agencies led by Standard & Poor’s, Moody’s Investor Service and Fitch Ratings during the four-day conference of the Asian Development Bank (ADB) next week.

Finance Secretary Cesar Purisima told editors and reporters of The STAR during a roundtable discussion Wednesday evening the Philippines would try to convince anew visiting officials of the rating agencies who are scheduled to attend the 45th Annual Meeting of the ADB Board of Governors from May 2 to May 5.

“We are always making a pitch and we will do that again here,” Purisima stressed.

Officials of rating agencies who are expected to attend the four-day conference include S&P United States president Douglas Peterson, S&P Japan executive managing director Yu Tsung Chang, S&P Singapore managing director Surinder Kathpalia, S&P Singapore senior director Kim Eng Tan, and S&P Hong Kong senior director for communications for Asia and the Pacific Lisa Coory.

Also expected to fly into the country next week are Fitch Singapore senior director Ambreesh Srivastava as well as Moody’s Australia managing director and regional head for Asia and the Pacific Jennifer Elliot, Moody’s Singapore associate analyst David Erickson, Moody’s Hong Kong vice president senior analyst Myoung Heung Kang, and Moody’s US associate analyst Cally Siderias.

Fiscal and monetary authorities have been trying to convince international rating agencies to upgrade the country’s sovereign credit rating as well as outlook on the back of the strong macroeconomic fundamentals of the Philippines.

The Philippines has so far received at least five upgrades from rating agencies since President Aquino assumed office in June of 2010.

Just last December, S&P upgraded the country’s credit rating outlook to positive from stable, signaling a possible upward revision in the country’s credit rating over the next 12 months.

S&P raised the credit rating of the Philippines to two notches below investment grade from three notches last November of 2010 on the back of the country’s rising external liquidity.

Moody’s upgraded the country’s credit rating outlook to positive from stable January of last year, paving the way to the upgrade of the country’s credit rating to two notches below investment grade last June 15 amid the gains made in fiscal consolidation, sustained macroeconomic stability, and robust external payment position.

This was immediately followed by London-based Fitch Ratings that upgraded the country’s sovereign rating to one notch from two notches below investment grade last June 23 on the back of the country’s strong economic growth, improving fiscal position as well as robust external payments position.

With the rating actions, Fitch rates the country’s sovereign credit at one notch below investment grade while Moody’s as well as S&P rate the country’s sovereign credit at two notches below investment grade.

However, fiscal and monetary authorities led by Purisima said the country is still underrated by international credit rating agencies. They pointed out that the country now deserves an investment grade rating.

“However, we still view that the country is still underrated by credit rating agencies despite evident and relevant gains to improve our fiscal position, debt ratios, and our overall macroeconomic picture,” Purisima earlier said.

Amid the weak global demand brought about by the debt crisis in Europe and the economic uncertainty in the US, the Philippines managed to post a gross domestic product (GDP) growth of 3.7 percent last year from 7.6 percent in 2010.

 The growth was achieved amid a low inflation environment that averaged 4.8 percent last year or well within the target of three percent to five percent set by the Bangko Sentral ng Pilipinas (BSP).