Critical minerals and the new economic outlook for 2026
It is acknowledged that 2026 is the year the Philippines crosses the line to Upper Middle-Income Country (UMIC) status. Accordingly, this critical milestone announces to all and sundry that the country is poised to “transcend itself into a new era of global competitiveness and prosperity.”
It goes without saying that the nation under the administration of President Ferdinand “Bongbong” Marcos Jr. wants to defy its own odds to become one of the most sought-after business and investment destinations, not just in Asia but in the whole world.
The recent gathering of political, academic, and business executives that assembled for the Asia CEO Economic Outlook Forum 2026 came with the measured confidence befitting men and women who have built organizations and enterprises across one of the world’s most dynamic regions. They left, however, by most accounts, with something harder to carry: a sober reckoning with how much has changed, and how fast.
The forum, held at the exclusive Manila House, took place against a backdrop that few had fully anticipated when the year opened. The conflict in the Middle East and the disruption to energy supply through the Strait of Hormuz now pose a significant near-term risk to both growth and inflation across the region, compounding trade policy uncertainty that remains elevated.
What had been, at the outset of 2026, a year of guarded optimism for Asia’s economies has been overtaken by cascading shocks that are testing the resilience that the region has long claimed as its defining characteristic.
The scale of the disruption unfolding in the Persian Gulf is, by any measure, historic. No need to go into the details as these have been bannered to us these past days, as we reel from the effects of a global oil crunch and energy crisis that also goes beyond fuel.
Despite the severity of the external shock, speakers at the forum were careful to distinguish between pain and collapse.
The ASEAN+3 region enters this period from a position of relative strength — growth outperformed expectations in 2025, inflation remained low, and most economies retain meaningful fiscal and monetary space.
Asia’s economic fundamentals remain robust. Strong domestic consumption, rising investment, and a rapid pivot toward technological self-sufficiency are underpinning growth despite the backdrop of geopolitical turmoil, with India and Vietnam identified as standout performers both projected to exceed six percent growth, and significant expansion also expected from the Philippines, Indonesia and Malaysia.
The conflict in the Middle East could, however, lower economic growth in developing Asia and the Pacific by up to 1.3 percentage points over 2026–2027 and raise inflation by 3.2 percentage points if energy market disruptions last more than a year, according to ADB research. That is not a tail risk. It is the baseline scenario toward which current conditions are trending if a resolution remains elusive.
For Asia’s business leaders, the practical implications are immediate: supply chain costs are rising, energy-intensive operations are under pressure, and the consumer confidence that has sustained domestic demand in many economies is being eroded by fuel and food price pass-throughs. The forum’s consensus was that policy agility — not panic — is the appropriate response, but that the window for proactive action is narrowing.
For the leaders and executives that gathered at the Manila House for the forum, the global backdrop sharpened domestic concerns that had already been accumulating before the first shots were fired in the Persian Gulf. A public works corruption scandal had already dented infrastructure investment and rattled investor confidence heading into 2026. Third-quarter GDP growth fell to a four-year low of four percent in 2025, prompting the government to slash growth targets for 2026 through 2028.
And yet, the country’s structural fundamentals tell a different story than its recent headlines. The ASEAN+3 Macroeconomic Research Office forecast Philippine growth at 5.3 percent in 2026, projecting the country as the second-fastest growing economy in ASEAN, second only to Vietnam’s projected 7.4 percent — though it warned that inflation may accelerate due to the impact of the ongoing conflict in the Middle East.
Philippine CEOs enter 2026 facing economic pressures that mirror those of the previous year, now intensified by geopolitical dynamics and accelerating technological change. Domestically, concerns around fiscal governance persist, weighing on investor confidence and contributing to a more cautious business outlook.
The bigger challenge, as one regional economist puts it during the forum, lies beyond the near term: how to sustain high growth over decades. The Philippines is approaching upper-middle-income status — a milestone likely within reach in the coming years — but achieving high-income status by 2050 will require sustaining average growth of around 4.5 percent annually.
The Hormuz crisis does not derail that ambition, but it demands a recalibration of the path.
It was against this backdrop of compressed timelines and elevated stakes that I delivered my keynote address.
This is the paradox at the heart of my speech: that a crisis in the world’s most important oil corridor may be the clearest argument yet for accelerating the Philippines’ critical minerals agenda.
The world’s race away from fossil fuels — toward electric vehicles, solar panels, battery storage, and the advanced semiconductors that power artificial intelligence — is not slowing down. If anything, the Hormuz crisis has made the case for energy diversification more urgent, not less. I have consistently argued that the mining industry is the “most indispensable industry” in fighting climate change — because you need nickel, you need copper, and you need the other rare minerals in order to come up with solar panels, batteries and electric vehicles.
A world desperate to reduce its dependence on oil shipped through a vulnerable chokepoint is, by definition, a world hungrier than ever for the minerals the Philippines holds in abundance.
My point has always been this: mining can once again become a “strong pillar of growth” for the Philippines, noting the sector’s past contributions of over 20 percent to national export earnings.
On the question of investment climate, I pointed to the passage of Republic Act 12253, the Enhanced Mining Fiscal Regime Law, as a landmark reform that has brought greater transparency and long-term predictability to large-scale mining operations — the very qualities that global institutional investors demand before committing capital at scale.
I also cited the Philippines’ participation in the inaugural US-led Critical Minerals Ministerial in Washington in February, where Manila signed an MOU with Washington as one of 11 countries to cooperate on diversifying global critical mineral supply chains.
That agreement was a positive step toward strengthening responsible mining, advancing sustainable resource development, and enhancing the country’s role in securing critical minerals essential for the global energy transition.
The Hormuz crisis has only deepened the urgency of this agenda. Higher operating costs from diesel and power — real pressures for any mining company — are challenges to be managed, not reasons for retreat. The Philippine mining sector is expected to show modest expansion, fueled by surging demand for critical minerals like nickel and copper, which are essential for the global energy transition to electric vehicles and renewable energy.
The country is strategically positioned, with its abundant resources, to benefit from this structural tailwind. The geopolitical disruption that is raising costs in the short term is simultaneously raising the strategic premium on the minerals the Philippines can supply.
The Asia CEO Economic Outlook 2026 Forum may have closed without easy answers, but it had a clearer map of the terrain. As of today, the ceasefire remains fragile, talks between the United States and Iran have failed, and the Strait remains functionally impaired.
ASEAN remains one of the world’s most important growth engines. Growth for the region is expected to outpace global growth, anchored by strong domestic demand, an expanding middle class, and deeper regional integration.
The Philippines, as ASEAN Chair in 2026, has both the responsibility and the opportunity to demonstrate that this promise holds — not despite its challenges, but through how it navigates them.
For the mining industry, and for my vision of the Philippines as a responsible, strategically indispensable supplier of the minerals the clean energy future demands, the months ahead will be consequential. The window is open. The question — as it always is — is whether the country will pass through it. *
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