Upper-middle-income status attainable in 2025

We're ready for any outcome on tariff talks with US – Palace

- By DERCO ROSAL and ARGYLL CYRUS GEDUCOS

President Marcos' chief economic manager said that achieving upper-middle-income country (UMIC) status is definitely attainable by the end of 2025 or 2026, citing the still expansionary national budget planned for next year to stimulate the economy.

"Surely, we will attain UMIC status by the end of the year or next year," Department of Finance (DOF) Secretary Ralph G. Recto told Manila Bulletin on Wednesday, July 2, when he was asked if he believes the country can finally escape the lower-middle-income trap by next year and climb to UMIC status.

Recto's statement took off from the Washington-based World Bank's report that the Philippines' gross national income (GNI) per capita stood at $4,470, setting a record high. Last year's GNI per capita stood closer to the multilateral lender's lowered UMIC threshold of $4,496 to $13,935 for fiscal year (FY) 2026, due to the United States (US) dollar's appreciation versus other currencies.

According to the World Bank's latest country income classification, the Philippines remained classified as a lower-middle-income country (LMIC). LMICs are those whose GNI per capita ranged between $1,136 and $4,495 in 2024.

While the country's GNI per capita last year was within the Philippine Development Plan (PDP) 20232028's goal of $4,454-$4,592 for 2024 it still fell behind Vietnam's $4,490.

In the coming years, the government aims to raise full-year GNI per capita to $4,814-$4,920 by 2025, $5,256-$5,563 by 2026, $5,645$6,056 by 2027, and $6,044-$6,571 by 2028, under PDP 2023-2028, which serves as the Marcos administration's medium-term socioeconomic blueprint.

GNI measures the total income generated by a country's residents, both domestically and abroad, making it a broader indicator of economic performance than gross domestic product (GDP), which only accounts for local output.