The Philippine government has revised its economic growth outlook downward, marking a shift from the optimistic projections made by President Ferdinand Marcos Jr. a year ago.
The adjustment comes shortly after the World Bank officially reclassified the Philippines as an upper-middle-income economy, a milestone that has brought new fiscal and structural challenges.
In his 2025 State of the Nation Address, President Marcos cited easing inflation, improving employment figures, and rising business optimism as signs of a robust recovery.
However, the current downgrade in growth expectations suggests that underlying headwinds have persisted, complicating the administration’s economic agenda.
The lowered forecast signals a more cautious stance from policymakers as they navigate the transition to a higher-income status.
This reclassification often entails increased costs for essential goods and services, which can dampen consumer spending and investment if not managed carefully.