On Philippine Potential Growth of 5-7% Annually for 15 Years

Three beautiful business reports from The Philippine STAR have perked me up: 'Philippines can grow 6.8 percent annually, become middle-class society by 2040' (July 16), "BOI-approved manufacturing investments surge 165 percent in H1" (July 16) and "Projects with tax perks under CREATE hit P1.5 trillion" (July 14).

- Bienvenido S. Oplas Jr.

On the first report, the World Bank made an optimistic view that we can grow between 5.4 to 6.8 percent yearly until 2040 if productivity-enhancing measures are implemented. Among these are: reform complex business permitting processes that reduce barriers to entry and promote more competition, expansion in energy, telecommunications and logistics capacity to reduce costs, and expand exports and global value chain participation.

Fair enough. These are practical recommendations and are implementable. Among the sources of business bureaucracies are the local governments units (LGUs) as there are permits required from barangay to municipal/city to provincial.

National government infrastructure allocation should be revised to reward LGUs that have expanded their private investments by at least 10 percent yearly. This will hopefully propel LGUs to set aside their itch for bureaucracies to receive more infrastructure projects.

Related to GDP growth, three countries in the world have reported their second quarter (Q2) 2025 performance and they are all our neighbors. Vietnam has a whopping eight percent, from 7.2 percent in Q2 2024 and 6.9 percent in Q1 2025. China has 5.2 percent, from 4.2 percent in Q2 2024 and 5.4 percent in Q1 2025. And Singapore has 4.3 percent, from 3.4 percent in Q2 2024 and 3.9 percent in Q1 2025.