Manila: The Japan Credit Rating Agency, Ltd. (JCR) on Friday affirmed the Philippines' A- rating with a 'stable' outlook, citing the country's strong economic fundamentals, resilience to external shocks, and continued fiscal consolidation.
According to Philippines News Agency, the JCR recognized the Philippines' high and sustained economic growth potential, supported by solid domestic demand, low external debt, and substantial foreign exchange reserves in its latest assessment. Despite a slowdown in economic growth due to reduced public works projects and increased crude oil prices affecting consumption, the JCR anticipates a recovery in the second half of 2026 and a return to high growth rates over the medium term.
The JCR expressed confidence that the government's efforts to improve the investment environment and advance industrial upgrading will facilitate a return to high growth rates over the medium term. The agency also noted the Marcos Jr. administration's progress in fiscal consolidation, with the deficit-to-gross domestic product ratio expected to narrow to 5.6 percent in 2025 from 5.7 percent in 2024, and government debt-to-GDP projected to settle at 63.2 percent by the end of 2025.
External debt remained manageable at 30.3 percent of GDP at end-2025, while foreign exchange reserves reached USD110.8 billion, equivalent to more than seven months of imports. The JCR highlighted the solid foreign exchange liquidity position of the Philippines and its high resilience to external shocks.
The agency also acknowledged government initiatives to strengthen the investment climate and advance industrial development, including the CREATE MORE Act and public-private partnerships to complement public infrastructure investments. Efforts to promote high-value technology, maximize domestic mineral resources, and foster advanced manufacturing industries, particularly in semiconductors and electronic components, were also recognized.
In a separate statement, Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona Jr. remarked that the credit rating affirmation reflects continued confidence in the country's sound fundamentals amid external headwinds. Finance Secretary Frederick Go added that the affirmation underscores the resilience of the Philippine economy and the government's commitment to fiscal consolidation and long-term reforms, reinforcing investor confidence and supporting efforts to attract investments and sustain inclusive growth.
