DOF chief sees Philippine economy regaining 5-6 percent growth in H2

CEBU, Philippines — Philippine Finance Secretary Frederick Go said the economy is poised to regain momentum in the second half of the year as government infrastructure spending accelerates, exports strengthen and investment reforms improve the country’s long-term growth prospects.

Go, speaking at the Mandaue Chamber of Commerce and Industry (MCCI) Business Summit 2026 in Cebu, said the economy’s underlying fundamentals remain intact despite a slowdown over the past year, giving businesses reason to remain confident about the outlook.

“My single message for the Philippine economy is that our long-term fundamentals remain intact and on solid footing,” Go said.

Economic growth under President Ferdinand Marcos Jr. has averaged about 5.8 percent, which Go said remains significantly above the global growth rate.

The Cebuano finance chief acknowledged that expansion had weakened over the past 12 months, citing slower government spending and external shocks that pushed up oil prices and inflation.

Go said infrastructure agencies, including the Department of Public Works and Highways and the Department of Transportation, have assured him that spending will accelerate in the second half of the year.

“I’m very confident that in the second half of this year and the next year, we will resume our growth trajectory of five to 6 percent economic growth rate,” he said.

The pace of public spending will be closely watched by businesses, with infrastructure investment remaining an important driver of domestic demand and economic activity.

Go also pointed to the Philippines’ recent reclassification by the World Bank as an upper-middle-income economy, saying the move could strengthen the country’s investment appeal and borrowing capacity.

The classification, which came four decades after the Philippines was last upgraded, provides an additional signal to global investors of improving economic fundamentals, he said.

A lower cost of government borrowing could also translate into cheaper financing for businesses, Go said.

The Philippines’ general government debt-to-GDP ratio stands at about 58 percent, below the World Bank’s 70 percent threshold, according to Go. He said general government debt, rather than national government debt alone, is the more appropriate measure for international comparisons.

The country also retains investment-grade ratings from five international credit-rating agencies, while Philippine peso-denominated government bonds are set to be included in JPMorgan’s emerging-market government bond index next year, he said.

Go said the country’s traditional growth engines are also holding up. Overseas Filipino remittances reached $35.6 billion last year, while business-process outsourcing revenues rose to $40 billion. Total exports climbed 8.7 percent to $115 billion.

Goods exports have accelerated further this year, growing about 15 percent in the first seven months, Go said. The Philippines exported a record $85 billion worth of goods in 2025, the highest level in 15 years, according to the secretary.

The government is also relying on policy reforms to improve the Philippines’ competitiveness for investment.

Go highlighted the CREATE MORE Act, which provides incentives including extended income-tax holidays and enhanced deductions; the new public-private partnership law; legislation allowing government leases of as long as 99 years; accelerated right-of-way rules; and reforms aimed at lowering stock transaction costs.

The government has also opened more infrastructure projects to private capital, with more than 200 flagship projects available for public-private partnerships (PPP) Go said. Among them is a proposed P105-billion classroom PPP project.

Three major airports—the Manila International Airport, Laguindingan International Airport and Panglao International Airport—have also been privatized under the current administration, he said.

“These investments will expand access to education, healthcare, transportation, and build a more connected and more resilient Philippines,” Go said. — (FREEMAN)