MANILA - Bayanihan 3 will not help the Philippines improve its credit ratings standing, the head of the Bangko Sentral ng Pilipinas said on Sunday.
BSP Governor Benjamin Diokno said that while the proposed P401-billion stimulus package was not within the mandate of the central bank, he disagrees that “legislating Bayanihan 3 will help us to improve our ratings prospects after Fitch downgraded the country’s outlook to ‘negative’ from ‘stable’”.
“Nevertheless it should be pointed out that in a sea of ratings downgrade globally last year and this year, Fitch has affirmed the Philippines’ investment grade,” Diokno said.
He added that the rationale for Bayanihan 3 will fade with the submission of the 2022 national budget within a month or so.
The central bank chief said what the country needs to do now is accelerate the vaccine rollout, pursue the structural reforms, and continue the Build Build Build program. .
“These measures will immensely improve the Philippines’ growth prospects and its ability to attract foreign direct investments,” Diokno said.
The success of the vaccination program is the key to a strong and sustained economic recovery, he said.
The country meanwhile is struggling to ramp up its vaccine rollout. The government has said that it wants to inoculate 58 million Filipinos by the end of the year, down from an initial 70 million target.
ABS-CBN News however has been tracking the number of vaccinations since March, and as of July 14, only 4,047,792 Filipinos have been fully vaccinated against COVID-19. This means that the government has reached just 6.98 percent of the revised target after more than 4 months.
Economic managers have thumbed down proposals to increase spending saying the country should practice fiscal prudence.
Lawmakers, several economists and even business leaders meanwhile have called for more fiscal stimulus saying the country lagged its neighbors in terms of spending to support the economy amid the disruptions of the COVID-19 pandemic.
The economy shrank a record 9.6 percent last year amid the lockdowns imposed to check the spread of COVID-19.