NEDA: Economy in good shape despite missing targets

MANILA, Philippines — Even if the Philippines is likely to miss its growth targets for 2024, it still remains on track in reducing poverty and taming inflation while its economy continues to fare better than its neighbors in Asia, Socioeconomic Planning Secretary Arsenio Balisacan said yesterday.

With the Philippine Statistics Authority’s report on the country’s Gross Domestic Product to be released next week, Balisacan cited several factors that are expected to result in GDP growth lower than six to 6.5 percent set by the Marcos administration for 2025.

Six typhoons stomped through the country from late October to mid-November last year, of which three made landfall, leading to an estimated two-percent contraction of the agriculture sector, he said.

“We may have difficulty achieving the six percent for the full year, but we’ll see,” Balisacan told reporters.

“Otherwise, the rest of the economy is doing well. Of course, doing well, meaning, in relation to those constraints that I mentioned, but we could have done well if the environment is more favorable,” he said.

“But expect to have speedy recovery in 2025,” he added.

He noted the agriculture sector comprises about 10 percent of the country’s GDP and almost a third of the workforce.

Industries, he said, were also affected by the severe weather disturbances as many were forced to suspend operations.

The Marcos administration is closely monitoring developments in global trade, especially the possible impact of the tariffs the Trump administration in the US wants to impose on China, while wielding the P6.326-trillion national budget to cushion whatever external shocks may come, he said.

Still, there are a lot of things going for the economy, which is mainly driven by private consumption, Balisacan said, adding that the services sector is doing well.

“You know the performance of the economy was quite impressive compared to our neighbors in the entire Asia. We still are second, third among the major emerging economies in Asia as top performer,” Balisacan said.

Using the 2023-2028 Philippine Development Plan as basis, the country is still succeeding in aiming for rapid and inclusive growth, which was recently attested to by the World Bank that reported the Philippines’ economic growth has been inclusive compared to earlier periods in its recent history.

“But we can do even better and accelerate poverty reduction or goals to achieve single digit poverty incidence by the end of this administration and that there will be far less hungry people and people are more secure with respect to exposure to shocks – natural or manmade shocks,” Balisacan said.

In terms of quality of jobs, underemployment has fallen last year to 4.4 percent from 4.6 percent in 2023 while inflation fell to 3.2 percent last year, he said.

For 2025, the government expects to see inflation settling to within the government range of two to four percent, he said.

A robust labor market and stable inflation would have a powerful influence in reducing poverty, he said.

The Marcos administration aims to achieve six to eight percent GDP growth “and we do believe that the current configuration of the government budget will allow us to focus on critical services, particularly for social protection, for food security and for our basic infrastructure, including our flagship projects,” Balisacan said.