MANILA — The Philippines is now under review for possible inclusion in J.P. Morgan’s Government Bond Index for Emerging Markets (GBI-EM), a move expected to draw more foreign investors, improve liquidity, and lower borrowing costs for the government and private sector.

In a report released on Sept. 12, J.P. Morgan placed Philippine peso-denominated government bonds (RPGB) on its positive watchlist, the final phase before potential entry into the GBI-EM series. The index, followed closely by global fund managers, currently covers about 19 countries. Should the Philippines be included, it would account for about 1 percent of the GBI-EM Global Diversified Index. Saudi Arabia’s sukuk bonds were also added to the positive watchlist.

“Getting on the positive watchlist is a testament to the work the government and financial market leaders has done especially in the last few years to expand our capital markets, particularly our local bond market. This news serves as further impetus to execute more changes and reforms,” Bangko Sentral ng Pilipinas Governor Eli M. Remolona Jr. said.

J.P. Morgan cited “proactive market reforms” in recent years, such as streamlining tax treaty procedures, reviving the repo market, and launching the peso interest rate swap market. It also noted improved access to the RPGB market through Euroclear and enhanced secondary market liquidity with the Bureau of the Treasury’s consolidation of benchmark tenors.

Foreign ownership of RPGBs rose from 1.8 percent in 2021 to 5.2 percent as of June 2025, J.P. Morgan said. However, investors continue to call for further measures to deepen secondary market liquidity and reduce tax barriers.

J.P. Morgan said it expects to complete its assessment within six to nine months, with an update expected in the first quarter of 2026.