World Bank: Philippines to post 2nd fastest growth in Southeast Asia

MANILA, Philippines — The Philippines is expected to be the second fastest growing economy in Southeast Asia until 2027, according to the World Bank.

The Global Economic Prospects June 2025 report showed that the multilateral lender has maintained the 2025 to 2027 economic growth forecasts for the Philippines provided in April.

In particular, the report showed that the country’s economy is projected to grow by 5.3 percent this year, the second highest growth in Southeast Asia next to Vietnam’s 5.8 percent.

While the Philippines is expected to be among the fastest growing economies in the region, the World Bank’s 2025 gross domestic product growth (GDP) forecast for the country is slower than the revised 5.7-percent expansion last year and the government’s six to eight percent growth target for this year.

The Philippine economy grew by 5.4 percent in the first quarter, slightly faster than the previous quarter’s 5.3 percent, but lower than the 5.9-percent expansion in the same period a year ago.

The report also showed that the Philippines is expected to continue to have the second highest economic growth in Southeast Asia next year at 5.4 percent and in 2027 at 5.5 percent.

Despite this, the World Bank expects the growth to fall below the annual six to eight percent growth goal set by the government for 2026 and 2027.

Vietnam is expected to remain the growth leader in the region with a forecasted economic expansion of 6.1 percent for 2026 and 6.4 percent for 2027.

For East Asia and the Pacific, the World Bank expects growth to decelerate to 4.5 percent this year from five percent in 2024 due to higher trade barriers, heightened policy uncertainty and weaker global growth.

The World Bank also said it expects growth in East Asia and the Pacific to be at four percent next year and in 2027, below the region’s potential pace.

Downside risks to the outlook include the possible reversion of previously announced higher trade barriers and persistent heightened policy uncertainty.

“Additional shifts in trade policy would likely have large impacts on economies across the region, owing to their high trade openness and links to global production networks,” the World Bank said.

It said tighter global financial conditions, weaker growth in major economies, increased geopolitical stress and natural disasters also pose downside risks.

“There are, however, some upside risks associated with a partial resolution of trade tensions, larger-than-expected fiscal expansions in major economies and productivity gains from technological adoption,” the World Bank said.