Poverty reduction or credit ratings? The country needs both

AT the annual World Bank-International Monetary Fund Group meeting in Washington, D.C. last week, Finance Secretary Carlos Dominguez 3rd told an audience of credit ratings agency representatives that securing higher credit ratings for the Philippines was only “a secondary concern” for the Duterte administration, the “first priority” being poverty reduction.

The administration has set an ambitious goal – and a welcome one – of reducing the Philippines’ poverty incidence of almost 26 percent now to 17 percent within the six-year term of President Rodrigo Duterte’s. The government intends to do this, Dominguez told the debt watchers, by accelerating spending on pro-poor and growth-friendly programs – including significantly increasing infrastructure spending – to make the Philippines’ sustained economic growth more inclusive.