Government sets 3.5–4.5% growth target for 2026

MANILA, Philippines — The government is now expecting the country’s economy to grow between 3.5 percent and 4.5 percent this year due to the impact of the Middle East conflict and the lingering effect of the flood control controversy, according to the Department of Economy, Planning and Development (DEPDev).

“We hope to achieve, at least in 2026, 3.5 (percent) to 4.5 (percent) with all these changes,” DEPDev Secretary Arsenio Balisacan said in an interview with Money Talks aired over One News yesterday.

Balisacan’s comments were made following a recent meeting by the Development Budget Coordination Committee (DBCC), which sets the government’s macroeconomic targets.

Earlier, he said the government was aiming for a five to six percent gross domestic product growth for this year.

He said the DBCC’s new growth projections would be released within this week.

“DBM (Department of Budget and Management), as the chair of the DBCC, will be releasing the DBCC decisions,” he said in a Viber message yesterday.

The Philippine economy grew by 2.8 percent in the first quarter, the weakest in five years, as high fuel prices triggered by the Middle East conflict and lower infrastructure spending caused by the flood control scandal weighed on the economy.

Balisacan said that the second quarter performance could still be “a little problematic.”

“We still see some lag effects of the previous quarter and the last half of last year’s effects coming in,” he said.

However, he said that improvements are expected in the second half as government spending picks up.

He also said that the government has been working on ensuring accountability and improving governance.

“We have to improve and recover trust and confidence in public policy and governance. And that’s why we have been too preoccupied, very much preoccupied in the last couple of months,” Balisacan said.

He stressed that restoring trust and confidence in public policy and governance is vital in attracting investments that will create jobs and support economic growth.

Balisacan also said that the recent shocks, particularly the Middle East crisis, have not eroded the country’s economic growth narrative.

“I am hopeful that we are able to navigate well this crisis and, of course, our domestic issues, too, because we have still those lingering. We should be able to get back to that high growth scenario,” he said.

“But even more important than high growth is the inclusivity of that growth, that we see poverty reduced,” Balisacan said.