The ASEAN+3 Macroeconomic Research Office (AMRO) trimmed its 2026 growth outlook for the Philippines to 5.3 percent from an earlier estimate of 5.5 percent, according to a quarterly update released on Wednesday.
The revision follows a broader downward adjustment for the ASEAN Plus 3 countries as the region navigates shifting US trade policies and fluctuating technology demand.
The regional surveillance organization also reduced the 2025 Philippine growth outlook to 5.2 percent from 5.6 percent. Despite the lower figures, the Philippines is projected to remain the second-fastest growing economy in the Association of Southeast Asian Nations in 2026, trailing only Vietnam at 7.6 percent.
AMRO chief economist Dong He attributed the downward revision to a “fairly weak” third quarter growth, which fell sharper-than-expected at 4.0 percent.
“The picture for the Philippine economy is that it has been quite steady but there are some headwinds against the investment side. Private consumption has been quite firm and we continue to believe that private consumption will remain firm. On the investment side, I think there are more headwinds,” said He.
He said both private investment, which is supported by investor confidence, and public investment have been affected by such headwinds including the flood control controversies.
The AMRO economist said the local economy has been growing steadily but it has been slower compared to the pre-pandemic growth trend.
“In order to maintain resilience and even aim higher to go back to earlier trajectory of growth, we think that the public or policies should really focus on restrengthened resilience, particularly in light of the two main risks facing the Philippines in the longer term,” He said.
These include climate-related risks, along with the artificial intelligence boom. The economist said that strengthening infrastructure to withstand natural disasters and investing in human capital are important considerations.
“All these require strong public investment or public private partnerships and that requires very strong policy frameworks, prioritize spending plans and have targeted projects that would strengthen the economy’s capacity. And that would underpin both higher public and private investments,” said He.
Growth in the Philippines will outpace several regional peers, with Cambodia expected to grow 5.1 percent, Indonesia at 5.0 percent, Lao at 4.6 percent and Malaysia at 4.4 percent. Singapore’s growth is projected at 3.0 percent, Myanmar at 2.5 percent, Thailand at 1.7 percent and Brunei at 1.6 percent.
Philippine inflation is expected to accelerate to 3.2 percent in 2026 from 1.7 percent in 2025.
For the broader ASEAN+3 region, growth is estimated at 4.3 percent for 2025 and is projected to moderate to 4.0 percent in 2026. Regional inflation is forecast at 1.2 percent in 2026, which remains below the long-run average.
The 2025 performance for the region benefited from resilient technology exports and strong investment in emerging sectors like electric vehicles and advanced electronics.
AMRO chief economist Dong He noted that while the region has shown resilience, the external environment remains highly uncertain due to unpredictable US trade measures.
“The ASEAN+3 region has demonstrated notable resilience, navigating global uncertainties more effectively than anticipated,” He said.
He said that while risks have become more balanced, a sharp slowdown in technology demand or delays in artificial intelligence deployment could weigh on exports.
Based in Singapore, AMRO monitors the economic health of the 10 ASEAN members along with China, Hong Kong, Japan, and South Korea. The organization urged member states to maintain policy readiness to respond to shocks while deepening regional integration to strengthen long-term resilience.
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