MANILA, Philippines — The Philippines is expected to grow at a faster pace this year and next, but geopolitical tensions and unfavorable weather conditions pose risks to the outlook, according to the United Nations (UN).
The World Economic Situation and Prospects 2025 report showed the UN expects the Philippines to grow by 6.1 percent this year from an estimated 5.6 percent growth in 2024.
While the UN’s growth forecast for this year is within the government’s six to eight percent growth target, its 2024 growth projection is below the government’s six to 6.5 percent growth goal.
For 2026, the UN expects the Philippines to post an even faster growth rate of 6.2 percent, within the government’s six to eight percent growth goal.
From January to September, the Philippine economy grew by an average of 5.8 percent.
The UN said growth in the Association of Southeast Asian Nations (ASEAN) economies remained resilient in 2024, supported by robust domestic consumption, investments and improvements in net exports.
Amid trade tensions between China and major developed economies, the UN said ASEAN countries also continued to receive foreign direct investment flows.
However, the UN said there are risks that could affect the growth outlook.
“Amid persistent geopolitical tensions and conflicts, increases in protectionist measures remain a possibility,” the UN said.
It said the protracted weakness in the property sector in China could dampen the country’s broader economic prospects and potentially have adverse spillover effects to other countries including ASEAN in terms of weaker trade, investment and tourism.
“Inflationary pressures could re-emerge due to potential disruptions to vital trade routes and energy shipments from the Middle East or unpredictable La Niña weather patterns causing food prices to rise,” the UN said.
While the robust economic performance in East Asia and ASEAN has contributed to continued progress on the Sustainable Development Goals (SDG), the UN said the progress has lagged or even reversed in many other areas.
Should the current pace continue, it said more than 80 percent of the SDG targets will not be achieved by 2030 in Asia and the Pacific.
“Stepping up climate action, in particular, is an immediate priority due to its ongoing regression,” the UN said.