'Investments, innovation key to achieving growth' potential'

The Philippines will need to make more investments, encourage innovation and upgrade infrastructure to improve productivity and achieve its growth potential, according to the Department of Economy, Planning and Development (DEPDev).

- 

Speaking at the BusinessWorld Economic Forum, DEPDev Secretary Arsenio Balisacan said sustaining economic progress and achieving higher potential growth would require going beyond consumption and services and broadening the country's economic drivers.

“This requires attracting more investments, generating higher-quality and better-paying jobs — particularly in manufacturing and higher-value-added services — and expanding into new markets,” he said.

Balisacan said that it is equally important to raise the productivity of the country's economic sectors through the adoption of modern, value-creating, innovative technologies.

In addition, future-proofing the economy through transformative and forward looking policy reforms will be needed amid disruptions caused by megatrends reshaping the economic landscape, including heightened uncertainty, the rapid evolution of artificial intelligence (AI), intensifying climate risks and demographic shifts.

Balisacan said raising the country's growth potential has become more important given changing demographics, with the country's fertility rates declining, working-age population growing and dependency rates falling.

As estimates indicate that the dependency ratio could drop from 33 to 31 dependents per 100 working-age individuals between this year and 2035, Balisacan said there is a more favorable balance for economic growth with greater savings or investment from the working population to fuel such growth.