Fitch upgrades Philippines to investment grade

Fitch Ratings said Wednesday that it had promoted the Philippines credit rating to investment grade, citing the nation's resilient economy and improved fiscal management.

The hike was the first to investment grade by any of the three major ratings agencies, in an endorsement of political and economic reforms by President Benigno Aquino's nearly three-year-old administration.

"The Philippine economy has been resilient, expanding 6.6 percent in 2012 amid a weak global economic backdrop," the agency said in a statement posted on its website that announced the upgrade.

Fitch said it had raised the country's key long-term foreign currency issuer default ratings to 'BBB-', or investment grade, from 'BB+'.

It added that the Philippines had experienced stronger and more stable growth than other BBB- countries over the past five years, and was expected to continue performing strongly with growth of 5.5 percent in 2013.

The ratings agency also cited fiscal reforms as well as improved governance carried out by Aquino since he took office in 2010 as among the reasons for the upgrade.

"Governance reform has been a centrepiece of the Aquino administration's policy efforts. Entrenching these reforms by 2016 is a policy priority of the government," Fitch said.

It also credited the central bank for keeping inflation under control and for managing the country's debt.

The Philippines posted an inflation rate of 3.2 percent last year.

The other two major credit rating agencies, Moody's and Standard and Poor's, raised the Philippines to one notch below investment grade last year.