The Philippine economy is showcasing one of the highest growth rates across Asia this year as it grapples with significant global challenges such as geopolitical tensions and natural disasters. Economic growth figures released indicate the Philippines achieved an impressive average expansion of 5.8% during the first three quarters of 2024, with the economy growing at 5.2% just in the third quarter, surpassing key regional players like Malaysia at 5.2%, Indonesia at 5.0%, China at 4.8%, and Singapore at 3.8%.
NEDA Secretary Arsenio Balisacan commented on this remarkable resilience, stating, “The Philippine economy has shown remarkable resilience this year. Our GDP growth averaged 5.8% for the first three quarters of 2024.” Challenges such as significant weather disturbances caused by El Niño and La Niña failed to undermine the economic upward momentum.
The Department of Finance (DOF) highlighted efforts under the Marcos administration aimed at protecting the purchasing power of Filipinos against soaring food prices. Inflation rates have significantly improved—moving from 6.0% last year to just 3.2% at the close of November. Specifically, the inflation rate on rice has witnessed a dramatic drop from 22.5% to 5.1% due to the implementation of Executive Order 62, which facilitated the lowering of rice import tariffs. “This price decrease helped offset the impact of food price hikes caused by successive typhoons,” noted the DOF.
This drop in consumer prices is particularly beneficial for the lower-income households, where inflation rates fell to 2.9% from 5.8% just months earlier—underscoring the tangible impact of governmental fiscal measures. With expectations for the overall inflation rate hovering close to the government target of 2-4%, economic managers believe the target growth rate of 6.0 to 7.0% for the remainder of the year is within reach.
Looking beyond the immediate horizon, government officials aim for medium-term economic growth between 6.0% to 8.0% from 2025 to 2028. To achieve this ambitious target, Balisacan stated the necessity for enhanced infrastructure investments, improved ease of doing business, and elevated national competitiveness. Continued commitment to good governance can invite foreign investors, with Balisacan asserting, “To strengthen our performance in the external sector, we continue to engage in new free trade agreements...,” signifying efforts to stimulate economic engagement globally.
The Philippine Economic Zone Authority (PEZA) anticipates approved investments could reach PHP 216 billion by the end of 2024, marking its highest approval figures in seven years, with projections for 2025 likely to rise to PHP 235 billion—a notable 10% growth anticipated largely within the manufacturing sector. President Marcos’ endorsement of the Indo-Pacific Economic Framework for Prosperity (IPEF) is also expected to cultivate increased economic activity.
The IPEF was initiated by the United States and includes several Asia-Pacific economies, representing about 40% of global GDP, aiming to create more resilient and cooperative economic relationships across the region. Such initiatives position the Philippines as key player ready to seize investment opportunities, particularly as corporations look for alternatives to China.
Through strategic partnerships with the United States and Japan, bolstering the manufacturing sector will be integral to enhancing the Philippines’ role within the global supply chain. The continued commitment by the Marcos administration to transparency, accountability, and reform will play pivotal roles as the Philippines navigates future economic opportunities and challenges.
Overall, as the Philippines stands at the precipice of potential growth and development, officials continue to cultivate conditions ripe for investment. With attainable targets set for both short and long-term economic performances and the focus on good governance, there’s palpable optimism for the years to come.
