Manila: S and P Global Ratings on Thursday affirmed its 'BBB+' long-term and 'A-2' short-term ratings on the Philippines, attributing the decision to a temporary slowdown in public infrastructure spending.

According to Philippines News Agency, the outlook on these ratings remains positive. The credit rating agency highlighted the government's ongoing fiscal consolidation and stabilization of its debt burden as key factors. It acknowledged the country's strong external position but noted that recent current account deficits have reduced net external assets.

The ratings outlook was maintained as positive, with S and P expressing confidence that the Philippines will sustain its external strength and healthy growth rate. The agency expects the government's fiscal performance to improve over the next 12 to 24 months.

The affirmation comes amidst the Philippine government's investigation into anomalies in flood control projects. This scrutiny led to the suspension of budget allocations for these projects in 2026, with President Ferdinand R. Marcos Jr. noting that around PHP350 billion allocated for the current year remains unused. This situation contributed to a slowdown in domestic growth during the third quarter, as government spending decreased.

The country's GDP growth rate slowed to 4 percent, down from 5.5 percent in the previous quarter and 5.2 percent in the same period last year. Despite this, S and P believes the country's long-term growth trajectory remains healthy.

Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona stated that the S and P rating affirmation aligns with their view of the country's favorable long-term economic growth prospects. He emphasized that the Philippines is well-positioned against external risks, supported by USD110.2 billion in dollar reserves as of October 2025.

Finance Secretary Frederick Go commented that the affirmation of the country's ratings ensures that policy decisions will support sustainable growth and long-term stability. He highlighted that a high credit rating translates to cheaper financing for the government, leading to more resources for essential public services, ultimately benefiting Filipinos by improving their quality of life.