Philippines might lose credit rating if wrong president in power
What does it take to slide down in credit ratings after six years of positive improvements? According to the Malakanyang Palace, a wrong president elected into power might set the Philippines back 6 years of improvement in credit ratings.
The Palace warned that the country's credit ratings could be "at risk" if the next leaders are careless. In Standard & Poor's latest projected growth for the country, it said that the per capita income in the Philippines is expected to increase to $3,000 this year and it affirmed the country's investment rating to BBB, one notch higher than the minimum score for a country within investment grade level.
Credit ratings are what foreign investors primarily look at as their basis on whether or not they will invest in the country. A good credit rating means that the management of the business sector is good, and that the investments they will put in the country for their businesses are safe. Foreign investments are a huge source of capital for the country, as it rises from being considered "The Sick Man of Asia".
"Hindi forever ang ganitong mga ratings. (These ratings are not forever.) They have to be nurtured, protected and they are based on a track record at kung babaliwalain ito then siyempre there will be consequences (and if these will be neglected, of course there will be consequences.) So, it's a timely reminder to all of us to vote on the basis of a responsible frame of mind," said Manuel Quezon III, Undersecretary of the Presidential Communications Development and Strategic Planning Office.
Another credit rating agency, Fitch Ratings, also maintained the investment grade rating for the Philippines as BBB-.
These ratings point to robust economic growth, declining debt burden, a stable banking sector, and strong external payments position.
These are also a sign of global trust. Investors who positively view the Philippines trust that when they invest in the country, there is a good chance for their businesses, as well as the country, to grow.
Global investors are now watching the Philippines as the country is set to elect a new set of leaders this coming May 9. The Palace warned that if a president with unclear or unfavorable set of policies for global investors is put into power, they may decrease investments in the country.