OECD slashes Philippine GDP growth projections for 2025, 2026

The Organisation for Economic Co-operation and Development (OECD) slashed its Philippine growth projections for this year and 2026.

In its latest Economic Outlook on Tuesday, the OECD cut its Philippine gross domestic product (GDP) growth forecast to 4.7% for this year, from 5.6% in its June report. This is well-below the government’s 5.5-6.5% growth goal for 2025.

“Private consumption is supported by a strong labor market and contained inflation, but investment has weakened as the execution of public infrastructure projects has slowed on the back of a corruption scandal linked to public works,” the OECD said in the report.

It also noted that the growth will gradually return its growth path “but risks are tilted to the downside.”

The OECD also cut the growth forecast to 5.1% for 2026, from 6% previously.

It also sees the Philippines growing by 5.8% in 2027.

However, the projections are below the government’s 6-7% target for 2026 to 2028.

Earlier, Economy Secretary Arsenio M. Balisacan said it is “very unlikely” that the economy will meet even the lower end of the growth target this year as bad weather and a corruption scandal weigh on economic activity.

Mr. Balisacan said the Development Budget Coordination Committee is set to meet on Dec. 9 to review the macroeconomic assumptions and targets.

At the same time, the OECD sees headline inflation averaging 1.6% this year, “before gradually reverting to the mid-point of the central bank’s 2-4% target band as favourable food and energy price shocks fade and domestic demand recovers.”

This is slightly higher than the Bangko Sentral ng Pilipinas’ 1.7% average forecast for 2025. — Aubrey Rose A. Inosante