Climate, Al risks face Phl

Two main challenges facing the Philippines in achieving continued economic growth are climate risk and the advent of Artificial Intelligence (AI), according to economists at the ASEAN+3 Macroeconomic Research Office (AMRO).

- MARIANNE GO

During an online press briefing held yesterday by the AMRO on its ASEAN+3 Financial Stability Report (AFSR) 2025 and the ASEAN+3 Regional Economic Outlook (AREO) October update, chief economist Dr. Dong He and lead economist Runchana Pongsaparn, retained their growth forecast for the Philippines at 5.6 percent this year, and 5.5 percent in 2026.

However, they explained that if their forecast materializes, growth would be on a downward trend from 2024’s GDP growth of 5.7 percent partly because of weaker exports, just like other countries in the region, where the impact of the new US tariffs will kick in toward the end of the year and next year.

Fortunately, though, the AMRO economists expressed optimism that consumption in the Philippines will continue to grow steadily, supported by the strong labor market, lower inflation and by the still robust remittances.

However, Pongsaparn noted that private investment and sentiment, and export performance are the ones that would probably post moderate growth because of the external uncertainty related to the US tariff adjustments.

In terms of the corruption scandal, she said, “I think we would have to see, to what extent it is actually going to affect the wider economy, because if the event is short-lived and then it does not severely affect the investment sentiment, then that could be contained, and may not affect the growth forecast materially. So, we still wait and see the overall impact.”