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Amid a looming global trade war, the World Bank slashed its 2025 and 2026 growth forecasts for the Philippines to levels that would bring economic expansion to their slowest pace post-pandemic.
The Washington-based multilateral lender's East Asia and Pacific Economic Update report for April 2025, published on April 24 (US time), forecast the Philippines' gross domestic product (GDP) to grow by only 5.3 percent this year, before inching up to 5.4 percent next year.
If the World Bank's latest projections for the Philippines materialize, they would be the lowest growth rates since 2021, when the economy recovered after gradually reopening from the most stringent Covid-19 restrictions that dragged the country to its worst post-war recession in 2020.
They are also below the government's more ambitious six- to eight-percent annual economic growth target for the next two years.
Back in October 2024, the World Bank was more optimistic, projecting Philippine GDP growth at six percent for 2025 and 6.1 percent for 2026.
As global trade tensions intensified after United States (US) President Donald Trump announced sweeping tariffs imposed on America's trading partners during his so-called "Liberation Day" last April 2, The World Bank had postponed the launch of its latest East Asia and Pacific Economic Update, which was originally scheduled for release on April 9.
Across the region, "rising global uncertainty, especially regarding trade policy, is affecting business and consumer confidence, reducing investment and consumption," the report said.
"New trade restrictions, including tariffs are expected to hurt exports. And slower global growth is likely to further reduce external demand," it added.
