IMF slashes Philippine growth forecasts

The International Monetary Fund (IMF) has downgraded its growth forecasts for the Philippines, citing weaker-than-expected performance in the first half and external headwinds that could weigh on exports and investment.

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In its latest Article IV Consultation, the IMF now expects the Philippine economy to expand by 5.4 percent in 2025, slightly lower than the 5.5 percent projection in its July World Economic Outlook.

Growth is projected to improve to 5.7 percent in 2026, but still weaker than the earlier estimate of 5.9 percent.

Both forecasts are below the government's 5.5 percent target this year and six percent target next year.

“The revision reflects factors related to the first half performance, which was weaker than expected,” IMF mission chief Elif Arbatli Saxegaard, who led the consultation mission in Manila, told reporters yesterday.

Saxegaard said external pressures, including higher tariffs slapped by the United States on Philippine exports, could dampen trade and investment prospects.

“Some of the important factors will be the higher tariffs, which are imposed on the Philippine exports to the US and will weigh on exports and investment,” she said.