MANILA – The government is taking advantage of the Philippines’ good credit rating by applying for loans to help fund its economic recovery plan after the coronavirus disease 2019 (Covid-19) pandemic, Malacañang said on Wednesday.
In an interview with state-run PTV-4, Presidential Spokesperson Harry Roque said the country can borrow money with low interest rate because of its good credit history.
“So sinasamantala rin natin na habang maganda ang ating credit rating. Umuutang na tayo, dahil ‘pag maganda ang credit rating, mas mababa po ang interest rate (We are taking advantage while our credit rating is good. We are borrowing money since we are enjoying a lower interest rate because of our good credit rating),” Roque said.
The Philippines’ credit score has reached the “A” grade level for the first time this month.
On June 11, Tokyo-based debt watcher Japan Credit Rating Agency Ltd. announced an upgrade in the Philippines’ credit rating to “A-” with a “stable” outlook.
The country’s new credit score was one notch higher than the previous “BBB+” and the highest rating it has ever received.
Better credit scores allow the Philippine government to acquire cheaper foreign loans.
Roque said the loans would be used to help the country recover from the impact of the Covid-19 pandemic.
“Ang pag-gagamitan po diyan, napakarami po (The money can be spent in several programs),” he said. “Hindi pa natin alam kung ano ang mga magiging pangangailangan natin kung patuloy pong lumaki ang mga numero ng mga nagkakasakit ng Covid-19 (We don’t know yet how much we need if the number of Covid-19 cases continues to rise).”
As of Tuesday, the Philippines has reported 26,781 confirmed Covid-19 cases, with 1,103 fatalities and 6,552 recoveries.
On Tuesday, Finance Assistant Secretary Antonio Lambino said the Philippines plans to borrow at least PHP400 billion to support the government’s Covid-19 economic recovery efforts.
Lambino said the financing will be taken from lenders like the World Bank, the Asian Development Bank, the Asian Infrastructure Investment Bank (AIIB), and other financial institutions. (PNA)