The economy bore the brunt of the flood control scandals.
We cannot blame some stock market pundits and investors for being bearish on Philippine stocks with what has happened in the past four months.
Congressional hearings on flood control anomalies and admissions of corruption and payoffs that also involved some lawmakers put a dent on market sentiments and sparked calls for resignation of public officials.
The stock market has already lost nearly 14 percent of its value since the start of 2025 and over 17 percent year-on-year as of Nov. 11, 2025.
The economy bore the brunt of the flood control scandals. Per the account of
Department of Economy, Planning and Development (DEPDev) Secretary Arsenio Balisacan, the economy grew slower in the third quarter of 2025 as a result of the flood control anomalies and projects that were delayed, questioned, or paused due to procurement and governance issues.
The controversy led to underspending in certain pockets, slower project execution and a drag on construction and related services.
“The Philippine economy continues to grow, but the third quarter’s performance reminds us of the urgent need to address key challenges and strengthen our foundations for rapid, sustained and inclusive growth,” said Balisacan.
The Philippine economy grew 4.0 percent year-on-year in the third quarter of 2025, the slowest in nearly five years amid the disruption in public works caused by the flood-control controversy.
The growth was the weakest since the gross domestic product (GDP) shrank 3.8 percent in the first quarter of 2021. It was slower than the 5.5-percent expansion in the second quarter and 5.2-percent growth in the third quarter of 2024.
There was a sharp contraction in public construction in third quarter due to stricter validation measures for the Department of Public Works and Highways’ (DPWH) civil works and the implementation of stricter requirements that delayed billings and disbursements for government projects.
Special Assistant to the President for Investment and Economic Affairs Frederick Go acknowledged the slack in the pace of public construction but remains pragmatic about it. His office considers it a reminder that growth is not just about appropriations—it’s about execution.
“When red flags appear, authorities must investigate. But the response cannot be paralysis. The faster we separate the good projects from the questionable, the quicker we restore momentum without compromising accountability,” a statement from the Presidential Communications Office (PCO) read.
Mr. Go prefers to be rosy about the prospects of the economy, rather than gloss over the non-productive political noise. He mentions data from the PCO including the P50.7-billion expansion project of Samsung Electro-Mechanics Philippines Corp. (SEMPHIL), the first company to secure presidential incentives under the CREATE MORE Act (Republic Act 12066).
The expansion will establish a new high-technology manufacturing facility for multilayer ceramic capacitors (MLCCs).
President Ferdinand Marcos Jr. met with Samsung Electro-Mechanics Co. Ltd. (SEMCO) executives on the sidelines of the 32nd APEC Summit in South Korea from Oct. 30 to Nov. 2.
“This is a direct outcome of this administration’s landmark policy reforms. It sends a strong message to the global business community: the Philippines is ready for high-technology, world-class industries,” the PCO said.
The expansion will establish a new high-tech manufacturing facility in the Calamba Premiere International Park, with commercial operations targeted by July 2027.
Over 3,500 additional high-skill jobs are expected to be created once the facility is fully operational, on top of over 7,000 Filipinos currently employed.
The PCO says a global tech leader is choosing to deepen its Philippine footprint because the incentive regime looks competitive and predictable.
Also lost in the tide of pessimistic investor sentiments is the public listing of Maynilad Water Services Inc. at the Philippine Stock Exchange, with President Marcos witnessing the milestone.
“That’s not just a ceremonial photo-op; it’s a vote of confidence in Philippine capital markets and a bet on essential infrastructure where long-term investors typically park serious money,” says the PCO.
Public investments, meanwhile, will continue to pump-prime the economy. President Marcos has ordered the release of P1.307 trillion in programmed funds for the fourth quarter of 2025 and directed agencies to fully utilize the budget through targeted, efficient spending to support growth.
It is common knowledge that government spending has a multiplier effect. Each peso deployed can generate more than a peso in economic activity.
A road project, for instance, doesn’t just employ construction workers. It triggers demand for cement, rebar, fuel, equipment rentals and logistics. Wages turn into purchases at local sari-sari stores, tuition payments and transport fares. Suppliers ramp up production and hire more people. The ripple moves outward.
The key is fiscal credibility: Releasing budgeted funds on schedule—with a mandate for targeted, efficient use—signals the state will not starve the economy of needed demand.
When a tech giant signals fresh bets, when a core utility goes to the stock market and when government commits over a trillion pesos to time-bound, targeted outlays, investors notice.
Go believes the hum of confidence could grow into tomorrow’s sustained, inclusive growth. Like the green shoots that the stock market is brushing aside.
E-mail: rayenano@yahoo.com or extrastory2000@gmail.com
