MANILA - External factors as well as the country's political issues pose as downside risks to the Philippine economy, a global debt watcher said.
The external factors include China's economic slowdown and market turbulence caused by a looming US Federal Reserve rate increase, S&P Global Ratings said in its latest report.
"Recently, tail risks from local and regional political issues have appeared as well," it added.
The Philippines' gross domestic product growth accelerated to 7 percent in the second quarter, indicating that economic and demographic fundamentals "continue to drive a strong domestic demand story," S&P said.
The debt watcher warned, however, that international investors "may be getting worried about potential diplomatic complications and short-term law and order issues on the ground."
S&P expects the Philippines to book an average GDP growth of 6.5 percent over the next few years on the back of strong consumption, higher investments, and the business process outsourcing industry.