UK rating agency asks the London-based agency Fitch Ratings says the government’s fiscal performance in the first half of 2007 was disappointing and that the budget deficit could reach P125 billion this year, way above the target of P63 billion.
The rating came as President Arroyo, in
her State of the Nation Address July 23, revealed a grandiose plan for
infrastructure development throughout the country. Fitch said those plans would
not materialize unless tax revenues increased. “In the absence of a significant
improvement in tax collection, it will not be possible for the Philippine
government to implement its ambitious and much-needed infrastructure
development program,” Fitch said.
The London-based credit rating agency’s
original deficit forecast for 2007 stood at P111 billion. But Finance Secretary
Margarito Teves said the government’s P63-billion deficit target remains
achievable.
