The Development Budget and Coordination Committee (DBCC) has adjusted the country’s economic targets for the next four years to a wider range due to domestic and global uncertainties.
“The growth assumptions for 2025 to 2028 have been given a wider band of 6.0 to 8.0 percent, reflecting the anticipated impact of structural reforms and evolving domestic and global uncertainties,” DBCC said in a joint statement.
In June meeting, the DBCC projected that the economy will grow 6.5 to 7.5 percent next year and 6.5 percent to 8 percent from 2026 to 2028.
“To achieve these targets, we remain committed to implementing reforms outlined in the Philippine Development Plan (PDP) 2023-202,” it added.
These include accelerating infrastructure investments, enhancing the ease of doing business, and boosting national competitiveness.
Meanwhile, the DBCC is optimistic that to attain its growth target for 2024 of 6.0 to 6.5 percent despite domestic challenges.
“In particular, we expect the Philippine economy to bounce back during the last quarter, given the anticipated increase in holiday spending, continued disaster recovery efforts, low inflation, and a robust labor market,” DBCC said.
The DBCC also expects inflation to average at 3.1 to 3.3 percent for the full year, significantly lower than the average inflation rate of 6 percent last year.
“This is supported by whole-of-government efforts such as the reduction in rice import tariffs, increased agricultural production, and other broad-based measures along with favorable supply conditions in the global market. We are determined to maintain price stability by keeping inflation low and stable amid easing monetary conditions, improving labor market conditions, and productivity-enhancing structural reforms,” DBCC said.
For 2025 to 2028, the inflation assumption is maintained at 2.0 to 4.0 percent.
Similarly, the assumptions for Dubai crude oil prices for 2024 were slightly narrowed to $78 to $81 per barrel from $70 to $85 per barrel, reflecting current market developments.
For 2025 to 2028, crude oil price assumptions were reduced to $60 to $80 per barrel from $65 to $85 per barrel, with the anticipated improvements in global oil production over the medium term.
The Philippine peso is anticipated to remain stable at an average of P57 to P57.50 against the USD for 2024, given sustained remittance growth, recovery in travel services, and growing BPO revenues.
“These favorable developments will support and keep the currency resilient against global headwinds,” DBCC said.
It is expected to broadly stabilize at P56 to P58 against the USD for 2025 and P55 to P58 against the USD for 2026 to 2028.
In terms of external trade assumptions, goods exports growth in 2024 was revised downwards to 4 percent, in line with the observed slowdown in export revenues in recent months as well as the revision in the outlook for the domestic semiconductor industry.
Meanwhile, the growth projection for goods imports in 2024 was maintained at 2.0 percent, as year-to-date figures have remained on track and the outlook for domestic consumption remains at current pace.
“With growth-enhancing fiscal consolidation at the forefront of our agenda, we have maintained our medium-term fiscal targets for 2025 to 2028,” DBCC said.
“This means that we remain determined to reduce the country’s deficit in a more gradual and realistic manner while also bolstering long-term investments that create more jobs, increase incomes, and decrease poverty incidence,” it said.
