Earlier this month, Moody’s Investor Services, one of the major credit ratings along with Fitch and Standard & Poor’s, upgraded the Philippine’s credit rating from Ba1 (below investment grade) to Baa3 (initial investment grade). This means that more investors will be encouraged to invest in our economy thus subsequently resulting to a better standard of living for everyone.
Of course, this is more complicated than that. But based on this article, the effects of the upgrade will first be felt by major corporations the likes of SM and Ayala whose net incomes will increase which would allow them to create more jobs, give better salaries and offer more competitive prices. The end result will be a more sustainable life for the common Juan. However, it may take years before the ordinary Pinoy, who is at the end of the “food chain”, can experience the ripple effect caused by the credit rating upgrade.
But why did Moody, Fitch and S&P gave credit upgrades to the Philippines? Reasons most common cited for this increase in investor’s confidence are the better fiscal management by the government which resulted to high GDP rates, low debt to GDP ratios and well anchored CPI inflation levels. If the economic reports are to be our basis, it would seem that Pres. Aquino is doing something right in his administration.
However, as of last week, Pres. Aquino’s net satisfaction rating dips to 15 points according to a recent SWS survey. Why the dip when the Philippine economy appears to be in an upward trend?
The public’s outrage over the pork barrel scam and Aquino’s apparent indecision towards the abolition of PDAF aka pork barrel is blamed to be the cause of most of the public’s outrage. The ratings are further aggravated by the DAP issue.
Apparently, despite the promising outlook for the country’s economy, there remains to be a gap between the public’s perception of the Aquino administration’s efforts in improving our economic status and in managing the levels of political corruption.
However, if I were to be asked, despite the issue over the pork barrel scam, I remain satisfied with Aquino’s governance of our country. The three credit rating upgrades we received from major credit rating companies are a testament to the confidence of investors in our economy which they wouldn’t have if they saw that the present government is unable to resolve the long curse of corruption plaguing our country. I believe that the Aquino administration’s staunch stand towards the “tuwid na daan” has paved the way for the exposure of the pork barrel scam and other scams involving high-level public officials. I believe that it is because of this exposés that has made investors see how serious the present administration is in pursuing corrupt officials. As such, even if all of the scandals seem to make our country look bad, it actually raises investors’ confidence in doing business with our market.
But I understand how the current corruption exposés would elicit anger from the public. Being a taxpayer myself, I can’t begin to imagine how people like Napoles can take it in their conscience to spend vulgarly public funds which are from the hard-earned money of every taxpayer and deprive the really needy citizens who would have benefited from the proceeds of the government funds they amassed for themselves.
At the end of the day though, I think, it all boils down to a question of what the common masses have felt and experienced first hand? Are they experiencing the effects of the credit rating upgrade? I doubt if the high prices of commodities and the sub-par salaries are to be considered. Are they experiencing the effects of corrupted funds? I believe so if we take a look at substandard government projects and the high incidence of poverty level in the country.
The credit rating upgrade’s effects will be felt years from now but the effects of corrupted public funds are apparent in our daily lives. Hence, the decrease in Aquino’s net satisfaction rating despite the increase in our credit rating.