R&I affirms investment grade rating for PH
The Philippines’ credit fundamentals remain resilient as the economy is expected to regain momentum in 2027, prompting Japan-based credit watcher Rating and Investment Information Inc. (R&I) to affirm its “A-” investment-grade rating with a stable outlook.
In its latest rating action on Friday, R&I said its affirmation comes as the country’s economic expansion is expected to continue despite disruptions from corruption issues and the energy shock.
“R&I views the disruption stemming from the series of corruption issues as temporary and believes that the thorough implementation of preventive measures will lead to improved governance through greater transparency in budget execution and infrastructure projects,” the agency said.
R&I first gave the A- rating to the Philippines in August 2024, raising it by a notch from “BBB+” with a positive outlook. It was likewise affirmed in August 2025.
The credit rater now expects economic growth to return to the 5-percent range in 2027 as budget execution normalizes.
Notably, economic growth in 2025 slowed to 4.4 percent following the flood control scandal that dampened infrastructure spending.
This slowdown has spilled over into 2026 and was compounded by the oil shock from the Middle East conflict, resulting in growth of 2.6 percent in the first six months of the year.
But R&I said the country’s economic expansion would continue to be supported by population growth, infrastructure investment and foreign direct investment.
Support will also come from tourism, IT-BPM and manufacturing, particularly semiconductors.
R&I also expects the country’s fiscal deficit to continue narrowing, while the debt ratio, although elevated, remains at a manageable level and is expected to decline over the medium term.
“The fiscal balance has improved as a share of gross domestic product (GDP), and the government debt ratio is likely to decline in the medium-term,” R&I said.
“With the current account deficit and external debt remaining at manageable levels, there is limited concern on the external front. In addition, the banking sector maintains stability,” it added.
The government expects the fiscal deficit to settle at 5.4 percent of GDP by the end of the year before narrowing to 4.2 percent in 2029. Meanwhile, the debt-to-GDP ratio rose to 63.2 percent in 2025 and is currently at 66 percent in the second quarter. It is expected to ease to 63 percent in 2030.
Investor confidence boost
In a statement, the Department of Finance (DOF) said the affirmation reinforces international investor confidence in the country, which could attract high-value investments and sustain growth.
“R&I’s affirmation of the Philippines’ A- rating and Stable outlook recognizes the government’s fiscal consolidation efforts and the strength of our economic reforms,” Finance Secretary Frederick Go said.
“This reinforces confidence, supports access to better financing, and helps attract quality investments that create jobs and expand economic opportunities for Filipinos,” he added.
For its part, the Bangko Sentral ng Pilipinas said it would continue its efforts to preserve stability and sustain confidence in the Philippine economy.
“The country’s resilience is supported by a sound banking system, an efficient payments system, and a healthy external position. The BSP remains focused on bringing inflation closer to the 3.0-percent target,” the BSP said.
“The BSP will continue to take a forward-looking and data-driven approach to monetary policy, financial supervision, payments oversight and external sector management,” it added.
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