MANILA -- A roadmap is being eyed to “articulate and systemize” the Philippines’ active pursuit of an ‘A’ level credit rating, a central bank official said on Wednesday.
Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa Guinigundo made this remark after Standard and Poor’s (S&P) gave the Philippines an upgrade in its investment grade credit rating to ‘BBB+’, the highest credit rating in the country's economic history conferred by the economic think tank.
Guinigundo said the roadmap “will evidence the buy-in and commitment of key economic and infrastructure officials to get efforts credited to ‘A’ before 2022.”
“This will help bring about more benefits to the economy and Filipino people,” said Guinigundo in a press briefing in Malacañan Palace.
He said the roadmap will be crafted by an inter-agency committee organized by the BSP and the Department of Finance (DOF).
The BSP official said part of the roadmap will involve efforts in addressing the issue of further increasing the country’s per capita income, enhancing potential output, strengthening external payments buffers, keeping prices stable, fortifying the public finance and elevating governance standards.
Guinigundo described these efforts as plots to the country’s “interesting story.”
“We shall then convey the story to our global audience with the assistance of the Investor Relations Office (IRO) of the BSP,” Guinigundo said.
He said the BSP’s IRO was established in 2001 precisely to raise the Philippines’ credit profile through collaborative, coordinated communication among agencies of the government and to promote the country as a viable investment destination.
‘Catriona swirl’
Guinigundo, meanwhile, said the key to maintaining the country’s high credit rating is to impress investors, market players, and financial institutions or in other words, doing a “Catriona swirl.”
He emphasized the importance of government attending meetings with the Asian Development Bank (ADB), International Monetary Fund (IMF) spring and fall meetings, Association of Southeast Asian Nations (ASEAN) meetings, among others to explain the country’s situation on the ground.
“(We must) remain engaged with credit rating agencies, actual and potential investors, market players, and international financial institution. Let us update them of the latest economic indicators and financial indicators, results of our own stress testing exercises,” Guiniguindo said.
“In short, as in a Miss Universe contest, we must do a Catriona swirl to be noticed, to be set apart from the rest because indeed, like Catriona, we have something beautiful to show them,” he added.
Guinigundo was referring to Filipino-Australian Catriona Gray, whose famous slow-motion twirl and hair flip helped her secure the Miss Universe crown in December last year.
According to Guiniguindo, there is a “beautiful narrative” on how the Philippines was able to “leap frog” to an investment grade that is now just one notch away from the ‘A’ category.
By sharing this, he said credit rating agencies, like the judges in a beauty contest, will be able to “sustain their glance” and give the Philippines “a gaze instead.”
Another key to an upgrade, he said is the sustained, focused, and persevering pursuit of policy and structural reforms.
“We reap what we sow. If we pursued policies that would further strengthen and increase our potential output including infrastructure and medical health and education, as this government is doing, we shall see economic growth surging with employment opportunities and poverty alleviation,” Guinigundo said.
“Per capita income will increase, price movements will be more modest, our external payments position will be less vulnerable to external shocks, the peso will be less volatile, investment will grow. And we shall see a virtuous cycle that would emerge in favor of our economy and our people,” he added. (PNA)
