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Jean Mangaluz - Philstar.com
June 26, 2025 | 6:01pm
Motorists endure heavy traffic at the Matina Pangi and Matina Aplaya areas in Davao City on Tuesday, Jan. 24, 2023.
Philippine News Agency / Robinson Niñal Jr.
MANILA, Philippines — The Philippine government has lowered its economic growth target due to erratic fuel prices driven by tensions in the Middle East, as well as new US tariffs.
From an initial target of 6.0% to 8.0%, President Ferdinand Marcos Jr.’s economic team has adjusted the projection to a narrower 6.0% to 7.0% range.
Budget Secretary Amenah Pangandaman announced the revised targets of the Development Budget Coordination Committee (DBCC) during a press conference on Thursday, June 26.
“The revisions take into account heightened global uncertainties, such as the unforeseen escalation of tensions in the Middle East and the imposition of US tariffs. Despite these headwinds, the DBCC remains vigilant and ready to deploy timely and targeted measures to mitigate their potential impact on the Philippine economy. Moreover, international reserves remain ample, providing adequate buffer to help absorb these external shocks,” Pangandaman read.
On top of the revised target for 2026 to 2028, the DBCC also updated the target for 2025, putting it at 5.5% to 6.5% from a previous 6.5% to 7.5%.
The DBCC said the government will prioritize stabilizing prices while expanding trade partnerships and boosting domestic industries.
“Accelerated implementation of government programs and projects also remains a key priority, alongside seizing growth opportunities in the services sector,” the DBCC said.
The DBCC also lowered its inflation target for 2025. From the original 2.0% to 4.0%, the new target is 2.0% to 3.0%. However, the target for 2026 to 2028 remains unchanged at 2.0% to 4.0%.
It also listed the following macroeconomic assumptions:
- Dubai Crude Oil is $60 to $70 per barrel in 2025, as well as 2026 to 2028
- Foreign Exchange Rate (Philippine peso to US dollar): 56 to 58
- Goods Exports growth, BPM6: 2.0% in 2025, as well as 2026 to 2028
- Goods Imports growth, BPM6: 3.5% in 2025, and 4.0% from 2026 to 2028
In terms of fiscal deficit, the Marcos administration is eyeing to reduce the fiscal deficit from 5.5% of the GDP in 2025 to 4.3% by 2028.
The DBCC said that revenue collections are expected to grow, with newly imposed taxes on digital service providers expected to boost income.
The World Bank has initially foreseen a weakened economic performance from the Philippines, with a slower GDP expansion in 2025 of 5.3% compared to 2024’s 5.7%.
