GDP growth – Page 2 – Author Carlo Carrasco

Philippines 3rd Quarter GDP Growth Lands At 4%

November 8, 2025November 8, 2025carlocarrasco

The official economic numbers have been unveiled at last by the Philippine Statistics Authority (PSA) and the results are disappointing as the gross domestic product (GDP) growth of the Philippines for the 3^rd quarter of 2025 landed at a disappointing 4%, according to a Malaya Business Insight new report. The results could mean that the Philippine economy could fall short of the 5.5% to 6.5% GDP growth range by the end of this year.

To put things in perspective, posted below is an excerpt from the news report of Malaya Business Insight. Some parts in boldface…

The Philippine economy expanded by 4 percent in the third quarter of 2025, a sharp slowdown from the second quarter and the year earlier as public construction spending eased amid stricter validation measures for government projects.

The third-quarter growth rate in gross domestic product (GDP) marks a deceleration from a 5.49 percent rise in the second quarter.

Data released on Friday by the Philippine Statistics Authority (PSA) also showed growth in the third quarter this year lost some momentum from 5.2 percent in the third quarter of 2024.

For the first nine months to September 2025, GDP grew by an average of 5 percent, easing from a rise of 5.8 percent in the year-earlier period.

Department of Economic Planning and Development (DEPDev) Secretary Arsenio Balisacan said services and industry, on the supply side, posted weaker growth. He pointed out that Department of Public Works and Highways (DPWH) civil works went through stricter validation measures.

Q3 growth drivers – National Statistician and PSA Undersecretary Claire Dennis Mapa said the main contributors to growth during the July-to-September period were wholesale and retail trade, including the repair of motor vehicles and motorcycles (up 5.0 percent); financial and insurance activities (5.5 percent); and professional and business services (6.2 percent).

“All major economic sectors — agriculture, forestry, and fishing; industry; and services — posted year-on-year growths in the third quarter,” Mapa said, citing respective increases of 2.8 percent, 0.7 percent, and 5.5 percent.

On the demand side, household final consumption expenditure grew by 4.1 percent year-on-year, while government spending rose 5.8 percent. Exports of goods and services climbed 7.0 percent, and imports expanded 2.6 percent. In contrast, gross capital formation — the measure of investment in fixed assets — fell 2.8 percent, reflecting caution among businesses and slower project rollouts.

Weaker services and industry – In a separate statement, DEPDev Secretary Balisacan, referring to the easing of the supply side, particularly in the services and industry performance in the nine-month period, cited “a sharp contraction in public construction due to stricter validation measures for DPWH civil works, as well as the implementation of new requirements that delayed billings and disbursements for government projects.”

Despite the slowdown, Balisacan pointed out that private construction “remained respectable,” though investment in durable equipment “was subdued.”

Indeed, the latest GDP growth statistics are disappointing. The national government plans to spend more than P1.3 trillion to boost the economy in the 4^th quarter and we will only find out the results of that in early January 2026.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the economy of the Philippines does not have enough momentum to achieve the national government’s GDP growth range for 2025? Do you think the ongoing flood control corruption scandal developments have turned away lots of foreign investors?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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BMI Sees Philippines GDP Growth Slowing Down To 5.2% In 2026

November 3, 2025October 25, 2025carlocarrasco

BMI, a unit of Fitch Solutions, officially lowered its 2026 gross domestic product (GDP) for the Philippines at 5.2% pointing a series of factors such as remittances slowdown, weaker investor sentiment, US tariffs on Philippine goods and the effects of the flood control corruption scandals, according to a Manila Bulletin news report.

To put things in perspective, posted below is an excerpt from the news report of the Manila Bulletin. Some parts in boldface…

Fitch Solutions’ unit BMI has sharply lowered its 2026 Philippine growth forecast to well below the government’s six- to seven-percent target, citing an expected slowdown in remittances, a weaker trade balance, muted investment sentiment, and downside risks to government spending stemming from the flood control fiasco.

“We expect remittance growth to slow due to tighter US [United States] immigration policy and a one-percent remittance tax on transfers from the US starting in 2026,” BMI said in a commentary published on Thursday, Oct. 23.

“A slowdown in remittances will weigh on domestic consumption, which will have an outsized impact on growth given the domestically driven economy,” BMI explained.

Against this backdrop, BMI has slashed its 2026 gross domestic product (GDP) growth forecast for the Philippines to 5.2 percent, one-percentage-point (ppt) lower than the 6.2 percent it projected previously.

If realized, this would also fall below this year’s growth goal of 5.5 to 6.5 percent, and 2024’s actual pace of 5.7 percent.

Another policy by US President Donald Trump that could drag down the local economy is the 19-percent tariff on Philippine exports, but zero tariffs imposed on select American imports.

This US-Philippines trade setup, according to BMI, “will weigh on the trade balance in 2026.”

Goods exports growth in August was the slowest in 2025 as US tariffs took effect and exporters’ front-loading of outbound shipments ended.

The latest Philippine Statistics Authority (PSA) data showed that goods exports grew by 4.6 percent year-on-year in August, marking the slowest increase since the 1.9-percent decline in December 2024

BMI also believes investor sentiment will “likely” remain muted next year as “erratic US trade policies will weigh on global investor sentiment and limit foreign direct investment inflows [FDIs].”

Domestically, government spending could bear the impact of a scenario where the ongoing flood control probe leads to the unearthing of more corruption cases tied to infrastructure projects beyond flood control.

“It could lead to even tighter scrutiny on government spending and reduce spending substantially below fiscally programmed levels,” BMI said. Capital outlays had dropped by 10 percent to ₱112.9 billion as of August, according to the Department of Budget and Management (DBM).

Infrastructure spending is expected to hit ₱1.51 trillion in 2025, ₱1.56 trillion in 2026, ₱1.69 trillion in 2027, ₱1.9 trillion in 2028, ₱2.03 trillion in 2029, and ₱2.2 trillion in 2030.

Meanwhile, BMI retained its 5.4-percent Philippine growth forecast for this year, still below the lowered full-year target.

Let me end this post by asking you readers: What is your reaction to this development? Are you convinced that due to several internal and external factors, economic growth of the Philippines will be slower this year and next year? Do you agree with BMI’s findings about the Philippine economy?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Moody’s Predicts 5.7% Growth for Philippine Economy in 2025

September 7, 2025September 1, 2025carlocarrasco

Based on its latest economy research, Moody’s Ratings announced that the economy of the Philippines will achieve 5.7% growth for the year 2025, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the news report of the BusinessWorld. Some parts in boldface…

THE PHILIPPINE ECONOMY is on track to grow by 5.7% this year on the back of strong household spending, steady remittances and sustained public investments, Moody’s Ratings said.

“We expect the Philippines to maintain strong economic growth relative to regional and rating peers,” Moody’s said after the completion of a periodic review of Philippines’ credit rating.

“Growth will be supported by resilient household consumption, stable remittance inflows from overseas workers, and public investment spending, and ongoing structural reforms,” it said in a report.

Moody’s forecast is within the government’s revised 5.5-6.5% gross domestic product (GDP) growth target for this year.

In the second quarter, GDP expanded by an annual 5.5%, up from 5.4% in the first quarter but slower than the 6.5% in the same period last year. For the first half, GDP growth averaged 5.4%, slower than the 6.2% a year ago.

Moody’s flagged downside risks to the outlook arising from the US tariff policies.

“Although the Philippines’ exposure to trade and global value chains is relatively low, uncertainty around US trade policy and tariffs presents some downside risks to domestic consumption and investment,” it said.

Since Aug. 7, the United States has been imposing a 19% tariff on Philippine goods entering the US. The US is one of the top destinations for Philippine-made goods.

Growth will also be supported by its fiscal consolidation efforts, but Moody’s flagged the government’s high debt stock and interest burden.

“Fiscal consolidation efforts are on track to meet the government’s revised Medium-Term Fiscal Framework of reducing the deficit to 4.3% of GDP by 2028, supported by the implementation of reform measures at enhancing revenue collection and spending efficiency,” Moody’s said.

While this will help temper Philippines’ debt burden, Moody’s said debt will remain “above pre-pandemic levels.”

As of June, the Philippines’ sovereign debt hit a fresh high of P17.27 trillion, up 11.5% from P15.48 trillion in the same month in 2024.

This brought the debt-to-GDP ratio to 63.1% at the end of June, the highest ratio since 2005. This is above the 60% debt-to-GDP threshold considered by multilateral lenders to be manageable for developing economies.

“Debt affordability, measured by the ratio of interest payments to revenue, is expected to weaken over the next two years, before gradually normalizing as global refinancing rates decline and economic growth returns to its long-term trend,” the debt watcher said.

“Despite rate cuts by the central bank since the second half of 2024, elevated government funding costs and a lag in the monetary policy transmission will keep interest burden higher,” it added.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think Moody’s Ratings of a 5.7% economic growth for 2025 will turn out true? What do you think it will take for the Philippine economy to reach 6% growth this year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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UA&P Sees Stronger Q3 Economic Growth for the Philippines Despite Trump Tariffs

September 1, 2025August 25, 2025carlocarrasco

As far as the University of Asia and the Pacific (UA&P) is concerned, the economy of the Philippines will still grow stronger in the 3^rd quarter by 5.8% despite the 19% Trump tariffs, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the news report of BusinessWorld. Some parts in boldface…

PHILIPPINE economic growth may pick up in the third quarter despite higher US tariffs and “milder” typhoons, the University of Asia and the Pacific (UA&P) said.

“Despite the Trump tariffs, milder typhoon season will help accelerate GDP expansion in Q3 to 5.8%, given a low base in 2024,” it said in its latest The Market Call released on Friday.

If realized, this would be faster than 5.2% in the third quarter of 2024 and 5.5% print in the second quarter. This forecast is also within the government’s revised 5.5% to 6.5% target this year.

“Consumer spending remains strong, aided by low inflation but limited by new US taxes on OFW (overseas Filipino Worker) remittances,” UA&P said.

Inflation cooled to a near six-year low of 0.9% in July as utilities and food costs continued to ease. This brought the seven-month average to 1.7%, slightly below the Bangko Sentral ng Pilipinas’ (BSP) 2-4% target band.

UA&P said government infrastructure spending may also regain momentum in the third quarter. This was after state spending slumped due to the 45-day election ban on public works spending from March 28 to May 12.

UA&P said residential construction will remain subdued due to elevated policy and interest rates.

The Bangko Sentral ng Pilipinas (BSP) has so far lowered borrowing costs by a total of 125 basis points (bps) since it began its easing cycle in August last year. The policy rate now stands at 5.25%.

UA&P said the US dollar rate will “move either way” depending on rate cuts by the BSP and the US Federal Reserve.

“The peso-dollar rate has a fundamental depreciation bias although it will depend much on extent and timing of policy rate cuts by BSP and the Fed,” it said.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the economy of the Philippines will be able to grow stronger in the 3^rd quarter even though the 19% Trump tariffs are already in effect? Do you see any signs of Philippine exports to America slowing down already?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Philippine Economy Grew by 5.5% in 2nd Quarter of 2025

August 9, 2025August 7, 2025carlocarrasco

The economy of the Philippines expanded by 5.5% during the 2^nd quarter of 2025, according to a GMA Network news report. Among the factors are strong 2^nd quarter gains by the agriculture, forestry, fishing, industry and services sectors.

To put things in perspective, posted below is an excerpt from the news report of the GMA News. Some parts in boldface…

The Philippine economy grew marginally quarter-on-quarter in the second quarter of 2025 amid the growth seen in services, agriculture, and industry sectors, and posted a deceleration from the same period last year, according to the Philippine Statistics Authority (PSA).

The country’s gross domestic product (GDP) — the value of goods and services produced in a period — grew slightly faster by 5.5% in the April to June 2025 compared to the 5.4% growth seen in the January to March 2025 period, PSA chief and National Statistician Claire Dennis Mapa reported at a press conference in Quezon City on Thursday.

The second quarter GDP growth was the fastest in four quarters, however, it was still slower than the 6.5% growth rate in the same period in 2024.

All major economic sectors posted annual growth during the quarter — agriculture, forestry, and fishing with 7.0%, industry with 2.1%, and services with 6.9%.

The PSA attributed the year-on-year growth to wholesale and retail trade, repair of motor vehicles and motorcycles with 5.1%; public administration and defense, and compulsory social security with 12.8%; and financial and insurance activities with 5.6%.

Fixed capital investments climbed 2.6%, led by private construction which grew 11.2%, and investments in durable equipment up 10.6%.

Government spending posted an 8.7% growth rate during the quarter, slower than the 18.7% seen in the first quarter, which Department of Economy, Planning, and Development (DepDev) Secretary Arsenio Balisacan attributed to the election spending ban.

“We expect to maintain that momentum in the spending side. I think that the next half, the second half of the year, you should see improvements in the construction, public construction spending,” he said in a briefing.

While the election spending ban hit government spending, officials said the campaigns boosted household spending which grew by 9.5%, faster than the 5.29% in the previous quarter, and the 5.4% in the second quarter of 2024.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the economy of the Philippines will be able to accelerate to achieve 6% gross domestic product (GDP) growth for the entire year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Nomura says America’s 19% tariff may cut Philippines GDP growth slightly

August 5, 2025July 28, 2025carlocarrasco

In the middle of mixed reactions towards the United States’ 19% tariff on Philippine exports, Nomura Global Markets Research stated that the country’s gross domestic product (GDP) growth could be cut by 0.4%, according to a BusinessWorld news report. Recently, US President Donald Trump and Philippine President Ferdinand “Bongbong” Marcos, Jr., met in the White House which resulted in the new tariff.

To put things in perspective, posted below is an excerpt from the news report of BusinessWorld. Some parts in boldface…

THE United States’ 19% tariff on Philippine goods could cut the Philippines’ gross domestic product (GDP) growth by 0.4 percentage point (ppt), Nomura Global Markets Research said.

In a report, Nomura said the US tariff of 19% on Philippine goods is “fairly high” and poses downside risks to growth.

“We estimate the direct effects could reduce our baseline GDP growth forecasts by a still-substantial 0.4 ppt in the Philippines.”

Nomura said this projection is “relatively substantial” compared to its baseline growth forecasts of 5.3% and 5.6% for this year and 2026, respectively.

“This is partly because we assigned 10% as the level where the reciprocal tariff rate could settle, on the assumption that the Philippines is a strong ally of the US and is not a third country for transshipments,” Nomura said.

“As it turns out, despite the visit to Washington by President Marcos and both sides reiterating the need for a strong partnership, the tariff was still set at 19%, which is even higher than the ‘Liberation Day’ level of 17%.”

Last week, Philippine President Ferdinand R. Marcos, Jr. met with US President Donald J. Trump at the White House in Washington, DC. Mr. Trump announced a 19% tariff would be imposed on Philippine goods, which will take effect starting Aug. 1.

“The trade ‘deals’ therefore represent upside surprises in terms of tariff rates, especially for the Philippines,” Nomura said.

“As a result, if implemented and these tariff rates are sustained, these will likely further weigh on growth in both countries relative to our current baseline forecasts.”

The government expects GDP to grow by 5.5-6.5% this year, lower than its previous target of 6-8%.

“While these ballpark estimates make sense to us, uncertainty remains high and these are ‘only’ taking into account the direct effects on these ASEAN countries’ exports to the US,” Nomura said.

These estimates do not account for sectoral tariffs, such as in semiconductors and pharmaceuticals, which are currently exempted, it added.

“But as our US team highlights, the risk is these could be set higher, though some countries could be exempted, adding to the uncertainty. As mentioned above, the details of the trade deals with Indonesia and the Philippines are still limited.”

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the Philippines is in a serious disadvantage with the American tariff of 19% imposed on the nation’s exports? Do you think the Philippine economy still has strong momentum to reach 6% GDP growth by the end of this year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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