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.