Socioeconomic planning secretary Arsenio Balisacan.
Despite the positive outlook in the country’s economy and finances, which was based on last year’s developments, the government has decided to lower its economic growth targets due to continued global uncertainties and the lingering impact of a massive corruption scandal.
According to socioeconomic planning secretary Arsenio Balisacan, this year’s goal has now been tagged at 5.0 to 6.0 percent while that for 2027 is eyed at 5.5 to 6.5 percent, down from the previous 6.0 to 7.0 percent set in June last year for 2026 to 2028.
The target for 2028, which will include the last six months of the Marcos administration, was maintained at 6.0 to 7.0 percent.
“We have done some work and some discussions and decisions (. . .) and the numbers that I mentioned, the GDP (gross domestic product) numbers reflect those decisions,” Balisacan noted.
“The reason for the scaling down of the growth arose from the realities that we have seen and we have been seeing, both globally and domestically,” he added.
Last month, the interagency Development Budget Coordination Committee (DBCC), of which Balisacan is vice chairman, met to review the government’s macroeconomic assumptions, growth targets and fiscal program following a marked third-quarter slowdown.
However, results of that meeting—which in addition to growth projections usually include inflation, exchange rate, trade, revenue and spending projections—have yet to be officially disclosed by Malacañan.
Based on official records, the country’s economic growth slumped to 4.0 percent in the third quarter, well below the 5.5- to 6.5-percent full-year target, slowing down from 5.5 percent three months earlier, as the flood control project scandal weighed on both government and household spending.
Secretary Balisacan did not say if the DBCC had revised the 2025 goal but he cited that growth likely settled at 4.8 to 5.0 percent in 2025.
Meanwhile, he asserted that consumption—the main driver of GDP growth—is still expected to rebound this year due to gains in employment and remittances and slow inflation and lower interest rates.
“I think that there are favorable forces . . . that we are seeing moving forward,” Balisacan enthused as he underscored that growth would likely post “sufficiently strong” growth in the second half of the year.
He cautioned, though, that first-semester growth could underperform due to the residual effects of last year’s shocks in the economy.
“The development last year is likely still to be felt this year, although with a weaker effect . . . so expect growth perhaps in the first quarter or at least the first half to be still quite what we’d want it to be,” Balisacan concluded.
