ADB says 3.8% GDP growth for Philippines still possible this year
The Philippines could still achieve 3.8% economic growth this year, according to the Asian Development Bank (ADB). This projection hinges on a significant acceleration in government spending and a recovery in household consumption. The ADB had previously lowered its Philippine GDP forecast to 3.8% in July from 4.4% in April, citing delayed investments and weaker household consumption. Second-quarter data showed the Philippine economy grew by a post-pandemic low of 2.3%, averaging 2.6% in the first half of the year, below the government's revised target of 3.5-4.5%.
The Philippines' path to 3.8% GDP growth this year faces a critical challenge in public investment execution, rather than financing. The Asian Development Bank (ADB) notes that while strengthening oversight is necessary, the immediate task is to rebuild efficient project delivery. This is evident in the 40.8% drop in infrastructure and capital outlays to P367.4 billion in the first half of the year, compared to P620.2 billion a year earlier. The ADB's forecast for 2027 shows a recovery to 5.3% growth, with inflation at 3.9%, supported by stronger public investment and easing inflationary pressures. For foreign investors and tech companies considering the Philippines, the emphasis on a predictable regulatory environment and stronger domestic capital markets is key. The ADB plans to increase private sector commitments in the Philippines in the coming years, having committed $143.3 million in 2025, primarily in long-term financing.
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