Manila, 3 October 2013 – The Philippines today achieved an investment grade rating from international credit rating agency Moody’s Investor Service. In a statement released by the agency, the sovereign rating of the Government of the Philippines was upgraded from ‘Ba1’ to ‘Baa3’ with a positive outlook. This upgrade by Moody’s follows the Philippine sovereign’s investment grade rating from Fitch in March and from Standard and Poor’s (S&P) in May. Both Fitch and S&P assign a stable outlook to the Philippines’ investment grade rating.

Receiving news of the announcement, Governor Amando M. Tetangco, Jr. of the Bangko Sentral ng Pilipinas (BSP) thanks the credit rating agency for the upgrade. “The BSP is pleased that Moody's has recognized the country's strong prospects and potentials as evident in the investment grade rating and positive outlook that it assigned to the Philippines. This is an affirmation of the steady and responsible macroeconomic stewardship and purposeful structural reform agenda of the Philippines.”

The Governor continues, “Clearly, Moody's has acknowledged the strong upside potentials and the constructive dynamics of the economy that should enable it to ride out the volatilities in global financial markets.”

He adds “This development should bode well for more investments, both local and foreign, in the country. Greater investments should strengthen the base for sustained and inclusive economic growth and usher in a transformative period for the Philippine economy.”

Reiterating the commitment to focus on macroeconomic stability, the Governor concludes, “The BSP shall continue to be attentive to challenges and risks in the operating environment. We will continue to ensure that the economy's resilience and flexibility are safeguarded through prudent monetary and financial policies.”

In its rationale, Moody’s cited the following key drivers for the upgrade: robust economic performance; ongoing fiscal and debt consolidation; and political stability and improved governance. In addition to the 7.6% GDP expansion in the first half of 2013, Moody’s highlighted the stability of the Philippines' funding conditions in the face of recent market volatility in emerging markets as evidence of the country’s resilience to external factors.

Also cited were the low and stable inflation levels as well as the liquidity of the banking system—the only system worldwide deemed by Moody's to have a positive outlook. The credit agency also highlighted the Aquino Administration’s popularity and success in institutionalizing its reform agenda. The positive outlook comes off the back of expectations of continued economic outperformance of the Philippines as compared to its peers in the region as well its continued prospects for reform in the second half of President Aquino’s term in office.