Ratings Agency Fitch Cites Improved Financial Management of the Gov't
One of the three major international credit rating agencies, Fitch, said yesterday that the Philippine government finances have improved amid efforts of the Aquino administration to win its first investment grade rating.
In a statement, Fitch Ratings said that the Philippines' public finances have become less of a drag on the sovereign credit profile, citing the Department of Finance's (DOF) efforts to lower the government's debt and lengthen its maturity.
"Sustained efforts under the Aquino and Arroyo administrations to improve fiscal management have brought many key fiscal metrics in line with or stronger than 'BB' and 'BBB' range peer medians," Fitch said.
The rating agency noted that then general government debt to gross domestic product (GDP) ratio, estimated to be 40.3 percent at end-2012, is on a par with 'BB and 'BBB' medians' 40 percent.
"Lengthening the maturity profile of national government debt to 10.7 years, compared with a 'BB' range median of 3.5 years, is also supportive of sovereign creditworthiness," Fitch added.
However, Fitch also said that the government's fiscal revenue base remains the key outstanding weakness in the public finances, estimated at 18. …