Finance Secretary Ralph Recto on Wednesday welcomed Fitch Ratings’ reaffirmation of the Philippines’ ‘BBB’ credit rating with a ‘stable’ outlook, citing the country’s strong medium-term growth amid rising external challenges such as geopolitical and trade tensions.
“Fitch’s reaffirmation of our credit rating is a powerful vote of confidence in the Philippines as a bright spot in a world clouded by global uncertainties,” Recto said.
“It underscores the strength of our economic fundamentals, the credibility of our ongoing reforms, and our resilience in navigating global headwinds—all while maintaining robust growth,” he said.
“We remain committed to sustaining this trajectory through sound fiscal management and an open, investment-friendly environment that invites and welcomes partners from around the globe,” said Recto.
A ‘BBB’ rating, above the minimum investment grade, indicates the Philippines’ strong creditworthiness, signaling confidence to investors and creditors and potentially resulting in lower interest rates and better returns for Philippine bonds.
Fitch’s recent affirmation positions the Philippines well to maintain its investment-grade status across major regional and international debt rating agencies.
Fitch highlighted the Philippines’ solid, domestically driven growth as a key buffer against external challenges.
The agency expects the Philippines to be relatively shielded from reciprocal tariffs imposed by the US, noting its lower average tariff rate of 17 percent as an advantage over regional peers. The country is also seen benefiting from lower global commodity prices and potential redirection of exports.
For 2025, Fitch projects the Philippine economy to grow by 5.6 percent, driven by strong infrastructure spending, robust services exports, and resilient private consumption supported by steady remittance inflows.
Fitch also recognized the government’s success in taming inflation and the easing of policy rates, which are expected to support continued private sector demand.
Over the medium term, growth is projected to exceed 6 percent, more than double the projected ‘BBB’ median, as the Philippine economy benefits from structural reforms and strategic investments, including the recently passed Public-Private Partnership (PPP) Code.
Fitch also acknowledged the government’s steady progress in fiscal consolidation, with the general government (GG) budget deficit narrowing and the GG debt-to-GDP ratio on a downward path.
Fitch anticipates the general government budget deficit to decline to 3.6 percdent of GDP by 2026, citing improvements in spending efficiency and tax administration.
“We note that overall budget balances have been close to the targets in recent history,” the rating agency said.