Tokyo: Japanese credit watcher Rating and Investment Information, Inc. (R and I) affirmed on Wednesday the Philippines' "A-" investment-grade rating with a stable outlook. An investment-grade rating signals low credit risk, thereby helping reduce borrowing costs. This enables a country to allocate more funds to socially beneficial initiatives and programs.
According to Philippines News Agency, R and I reported that "the economy of the Philippines continues to grow at a relatively high rate among major countries in Southeast Asia." The agency expects the Philippines to realize stable economic growth and higher income levels, supported by robust public and private investments, development of domestic industries like Information Technology and Business Process Management (IT-BPM), and population growth.
The agency also noted that the country's inflation rate fell to a six-year low of 0.9 percent in July 2025. Furthermore, it mentioned that the impact of the 19-percent US reciprocal tariffs is expected to be limited due to the Philippines' relatively low reliance on exports to the US.
R and I highlighted the Philippines' manageable current account deficit and debt levels, as well as sufficient foreign exchange reserves, which strengthen the country's external position. "The National Government's outstanding debt for 2024 was 60.7% of GDP. R and I believes that the government debt ratio will remain within manageable level with the progress in reducing fiscal deficits," the report stated.
The agency pointed out that the government primarily meets its funding needs through the issuance of government bonds in the domestic financial market and that the country maintains a certain level of debt affordability due to a manageable interest payment burden. The stability of the banking sector was also cited as a key rating driver.
In a separate statement, the Bangko Sentral ng Pilipinas (BSP) welcomed the affirmation. BSP Governor Eli Remolona Jr. remarked, "The low inflation environment is thanks to the agile and evidence-based monetary policy. This environment supports an investment climate that is conducive to economic growth."
Governor Remolona added, "In line with its financial stability mandate, the BSP continues to strengthen the Philippine banking system through policies that underscore strong capitalization, prudent risk management, and sound governance. These enable banks to finance productive economic activities while navigating a fast-evolving global economic landscape."
