Philippines catches eye of S. Korea investors
Philippine Daily Inquirer
More South Korean investors are expected
to invest in the Philippines after a credit-rating firm based in Seoul upgraded
its outlook on the country from “stable” to “positive.”
A positive outlook suggests a probability
that the Philippines’ present credit rating of BB+, which is a notch just below
investment grade, may be upgraded within the short term.
NICE Investors Service Co. Ltd. said that
when it made the decision to revise its outlook on the Philippines, it took into
account the government’s improving fiscal situation, the country’s rising
reserves of foreign exchange, and strength of its economy.
The factors indicate that the Philippines
has an improved capacity to settle its debts to foreign creditors, NICE said.
On the fiscal front, the recent
implementation of the new Sin Tax law, which raised taxes on cigarettes and
alcohol, reflected the Aquino administration’s commitment to shoring up revenue
collection.
NICE likewise cited the strength of
domestic demand in the Philippines that allows it to weather the problems of an
ailing the global economy.
Domestic demand is being fueled partly by
remittances from overseas Filipino workers and investments in the business
process outsourcing (BPO) sector.
“Solid private consumption and BPO
industry expansion have led service business-centered economic growth.
Consumption based on remittances is robust enough to absorb external shocks to
some extent,” NICE said in its report.
“Solid private consumption and BPO
industry expansion have led service business-centered economic growth.
Consumption based on remittances is robust enough to absorb external shocks to
some extent,” NICE said in its report. Michelle V. Remo
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