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The Philippines recently gets an A-level credit rating with a stable outlook from Japan Credit Rating Agency (JCRA) citing partly government measures to address the pandemic’s impact on the health system and the economy.

The rating affirmation came nearly 15 months after JCRA upgraded its ratings on the Philippines to A-level on June 11, 2020, on the belief that the economy would be able to weather the impact of the virus-induced pandemic.

“The ratings mainly reflect the country’s high and sustainable economic growth performance underpinned by solid domestic demand, its reliance to external shocks supported by an external debt kept low relative to GDP (gross domestic product) and the accumulation of foreign exchange reserves, the government’s solid fiscal position, and sound banking sector,” it said in a statement.

The Japan-based debt watcher said the recovery of economic activities is delayed as a result of movement restrictions needed to address the further spread of the coronavirus disease 2019 (Covid-19), especially given the more contagious Delta variant.

“However, the government has been swiftly implementing adequate measures such as increased public health-related expenditure, acceleration of vaccination, and continuation of employment program(s) by drawing upon its relatively strong fiscal position before the pandemic,” it said.

The credit rater said it “does not consider that the fiscal soundness will be impaired because while the fiscal deficit has widened, the support package at this time is backed by appropriate fiscal policies and the government debt will remain comparatively subdued.”

“The Duterte administration’s centerpiece infrastructure development program has not been retarded even amid the prolonged pandemic,” it added.