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Friday, March 29, 2024

PH to reach upper middle class status in 2025, NEDA chief says

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The Philippines is likely to achieve its target of becoming an upper middle-income economy by 2025—a year later than what the government expected, National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan said Saturday.

President Ferdinand Marcos Jr. has said in his first State of the Nation Address in July that his government is looking to bring the Philippines to “upper-middle income status by 2024” with “at least $4,256 income per capita.”

But owing to the sharp contraction PH…of the economy in 2020 and the sharp depreciation of the peso this year “the entry into that category of countries—upper middle-income country—will now be 2025,” Balisacan said during the weekly Saturday News Forum in Quezon City.

Under the World Bank’s updated standards, an upper middle-income economy or country has a gross national income (GNI) per capita of between $4,046 and $12,535 (about P225,000 to P696,000 at present exchange rates).

The previous Duterte administration aspired to bring the country to upper-middle income status by 2020, but the economy went into a recession due to the COVID-19 pandemic.

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In 2019, the Philippines was categorized as a lower-middle income country with a GNI per capita of between $1,006 and $3,955 (P55,860 to
P219,600).

Data from the Philippine Statistics Authority (PSA) showed the country’s GNI per capita stood at P182,438 (about $3,300) last year, higher than the peak of the pandemic year 2020 of P177,546 (about $3,200) but still lower than the pre-pandemic GNI per capita of P200,135 (about $3,600) in 2019.

Balisacan expressed confidence the country’s GNI per capita will hit $4,456 by 2025 “because at that level of per capita income, that’s when we meet the threshold of joining upper-middle economies.”

The target of achieving upper middle-income status is contained in the Philippine Development Plan (PDP) 2023–2028, the country’s blueprint for socioeconomic development over the medium term, which Mr. Marcos approved on Friday.

“Completed in record time—just six months into President Marcos’ term—the PDP is our plan for economic and social transformation. In the next six years, our overall goal is to reinvigorate job creation and accelerate poverty reduction by steering the economy back to its high-growth path. More importantly, the Plan seeks to effect economic transformation toward a prosperous, inclusive, and resilient society,” Balisacan said.

The NEDA chief said the PDP is framed by Marcos’ eight-point socioeconomic agenda, which seeks to address short-term issues confronting the country and medium-term constraints on rapid growth and inclusion.

The PDP is also geared toward the realization of the AmBisyon Natin 2040, the Filipino people’s collective vision for the long term.

“Given the uncertainties and headwinds that we face, the Plan is our roadmap that will show us the way forward, guiding our efforts and initiatives as we sustain our robust economic recovery and aspire for no less than the economic and social transformation of our country towards a matatag, maginhawa, at panatag na buhay (stable, convenient, secure life) for all Filipinos,” Balisacan said.

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