Subpar growth to linger

The Manila-based Asian Development Bank (ADB) and Singapore-based ASEAN+3 Macroeconomic Research Office (AMRO) have slashed their near-term Philippine economic growth forecasts to lower than six percent due to the expected global growth slowdown coupled with persistent tariff-led trade uncertainties.

- By DERCO ROSAL

AMRO decided to adjust downward its Philippine gross domestic product (GDP) growth forecast to 5.6 percent for 2025, and 5.5 percent for 2026. These are substantially slower than its previous forecast of 6.3 percent for both years.

"I think the main thing is actually the expectation of slower global growth," Allen Ng, AMRO group head and principal economist, said during the July 23 press briefing on the quarterly update of its flagship ASEAN+3 Regional Economic Outlook (AREO).

Ng noted that while the United States' (US) tariff on Philippine exports has a "direct impact" on the local economy, he argued that this is "not very large compared to other parts of the region, given the more domestic-centric structure of the Philippine economy."

On Wednesday, July 23, Philippine President Ferdinand Marcos Jr. concluded tariff negotiations with US President Donald Trump, resulting in a deal where Philippine exports to the US will be subject to a 19-percent tariff—slightly lower than the previous 20 percent but higher than the initial 17 percent when reciprocal tariffs were introduced in April.