By: Elena Grace Flores
Statistics don’t lie. It is evident over social media and group discussions how supporters defend Philippine President Rodrigo Duterte. However, facts are facts with credit rating uncertainties. Filipinos now have to expect a daunting economy if his mouth becomes uncontrollably bad once more.
Uncertainties Concerning Government
Standard & Poor’s has affirmed the country’s credit rating. But not before airing concern about “rising uncertainties” surrounding the government.
In a statement on Wednesday, S&P cited the country for its ample supply of foreign exchange and its low levels of foreign debt. The Philippines’ credit rating was kept at BBB, equivalent to investment grade.
Credit Rating: Indicator of Risk
An investment grade country is widely considered one capable of repaying its debts. Credit ratings are an indicator of risk. High rating brings down the borrowing cost of the government and corporates.
Extra Judicial Killings
However, S&P tagged new downsides for those looking to invest in the country. “Rising uncertainties surrounding the stability, predictability, and accountability of its new government are considered.”
President Rodrigo Duterte’s aggressive campaign for law and order is evident. He has been linked to a rise in alleged extrajudicial killings. Independent watchdogs estimate there have been about 3,000 drug-related deaths since Duterte took power in July.
“We believe this could undermine respect for the rule of law and human rights. It will be through the direct challenges it presents to the legitimacy of the judiciary, media, and other democratic institutions,” it said.
On top of that, the President has rejected any international criticism of his war on drugs. He has threatened to pull out the country from the United Nations and cursed off the United States and the European Union.
“[W]e believe that the stability and predictability of policymaking have diminished somewhat,” S&P said.
The Philippine economy, meanwhile, is still healthy, the credit rater said.