Macroeconomic Prospects of the Philippines in 2024–2025: Toward Upper Middle-Income Status

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This is the lead chapter of the 2023–2024 Economic Policy Monitor (EPM) of the Philippine Institute for Development Studies. It examines the economic performance of the Philippines for 2023 and, at most, the third quarter of 2024. It presents the conditions driving global, regional, and national outlooks, projections on growth, consumer prices, and prospects coming into 2025—all of which are relevant to making informed household, enterprise, and policy decisions. As the economy moves towards a better normal, it faces challenges from persistent headwinds stemming from both internal and external factors. According to the Philippine Statistics Authority, the economy grew by 5.6 percent in 2023, driven by growth in major sectors such as industry and services, while year-to-date headline inflation was recorded at 6.0 percent. Like previous EPM publications, this report also includes projected growth and inflation estimates for 2024 and 2025. It also considers the flow of funds from abroad, employment, financial conditions, use of public funds, and expected consumer and business expectations regarding the economy’s state of health. Building on the issues mentioned in previous macroeconomic prospects, this report underscores risks related to inflation, exchange rate movements, fiscal position, and the impact of external factors on national economic growth and development.

Comments on this paper are welcome within 60 days from the date of posting. Email publications@pids.gov.ph.