World Bank maintains 2026 Philippine growth forecast at 3.7%
A silhouette of the skyline is pictured at sunset in Quezon City, Metro Manila, Philippines, November 27, 2020. REUTERS/Eloisa Lopez
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MANILA, Aug 3 : The World Bank on Monday maintained its 2026 growth forecast for the Philippines at 3.7 per cent and said the economy’s recovery next year was likely to be slower than previously expected.
• “Growth is set to decelerate in 2026 on the back of weak investment, constrained consumption and sustainability,” Zafer Mustafaoglu, the World Bank division director for the Philippines, Malaysia, and Brunei told an economic forum in Manila.
• The new forecast was slightly below the 4.1 per cent average growth expected for developing economies in East Asia and the Pacific, Mustafaoglu said.
• The World Bank expects growth to rebound to 5.2 per cent in 2027, below the 5.6 per cent seen in June, and to reach 5.5 per cent in 2028, as public investment gradually recovers and economic conditions improve.
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• The Philippine government’s economic managers expect growth of 3.5 per cent to 4.5 per cent this year, lower than previously forecast due to the Middle East crisis and an infrastructure-related corruption scandal that slowed government spending.
• The economy grew 2.8 per cent in the first quarter, below expectation, weighed down by the Middle East conflict and a delayed budget passage.
• Mustafaoglu said inflation was seen averaging 5.8 per cent for the year, below the 6 per cent to 7 per cent projection by Philippine economic managers.
• Average inflation is projected to ease to 5.2 per cent in 2027, as governance conditions stabilise, public investment gradually recovers and the central bank resumes monetary easing, he added.
• The World Bank said the peso’s depreciation had fuelled inflation, keeping import costs high and delaying a slowdown in price increases.
• The peso is expected to trade at 60 to 62 per dollar for the period of 2026 to 2030, the government’s economic managers earlier said.
Source: Reuters
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