Flood control scam derails credit rating upgrade for PHL

THE FINANCE CHIEF on Tuesday said the multibillion-peso flood control scandal prevented the Philippines from getting a credit rating upgrade from S&P Global Ratings.

- By Adrian H. Halili Reporter

“If [only] we did not have the flood control issue,” Finance Secretary Ralph G. Recto told reporters on the sidelines of a Senate budget hearing, “We met with S&P, and they were ready to give us a credit rating upgrade this year.”

The controversy, which involves “ghost” projects and fund misuse in government flood control programs, has triggered investigations by Congress, the Commission on Audit, the Ombudsman, and the Independent Commission for Infrastructure.

The scandal highlighted spending inefficiencies and governance lapses that credit agencies closely monitor when evaluating institutional credibility and fiscal management.

Asked whether the Philippines can achieve an “A” credit rating in the next two years, Mr. Recto said: “I hope so.”

He said the government wants to maintain its current credit rating, despite the multibillion-peso corruption scandal.

“There is a big chance they will maintain it, but there was a bigger chance for a credit rating upgrade,” he added.

In November 2024, S&P affirmed its “BBB+” long-term credit rating for the Philippines, which is a notch below the “A” level grade targeted by the government.