Gov’t adjusts economic growth targets
In response to global trade disruptions and geopolitical tensions, the Marcos administration has adjusted its economic growth targets, the Development Budget Coordination Committee (DBCC) announced.
The DBCC, an inter-agency body responsible for setting the country’s macroeconomic assumptions, has revised downwards the Gross Domestic Product (GDP) target bands for 2024 and 2025. These revised targets were approved by President Ferdinand R. Marcos Jr. on Wednesday, April 3.
For the current year, the DBCC expects the country’s economy to grow between six percent and seven percent, a slower pace compared to the previous projection of 6.5 percent to 7.5 percent.
If achieved, this year’s growth would still exceed the 5.6 percent expansion recorded in 2023.
The GDP target has been narrowed to a range of 6.5 percent to 7.5 percent from the initial projection of 6.5 percent to eight percent in 2025.
According to the DBCC, these adjustments have been made in consideration of the latest trade outlook provided by the Bangko Sentral ng Pilipinas and the International Monetary Fund.
The DBCC expects a moderation in goods imports growth for the current year, with its projection set at four percent, a decrease from the previous target of seven percent.
Looking ahead, imports growth is projected to rise to seven percent next year and further to eight percent from 2026 to 2028.
“Goods imports are expected to be propped up by investments in public infrastructure,” the DBCC said in a statement.
Meanwhile, the DBCC noted that escalating trade distortions and geoeconomic fragmentation would constrain goods exports growth this year to eight percent, a reduction from the earlier target of five percent.
The DBCC is optimistic about the country’s exports in the following years, expecting them to rebound with an annual growth rate of six percent from 2025 to 2028.
The DBCC has adjusted its pesous dollar exchange rate projection for 2024, narrowing the range to ₱55 to ₱57 from the previously set ₱55 to ₱58.
The inter-agency committee has decided to keep the foreign exchange assumption unchanged at ₱55 to ₱58 for the period spanning 2025 to 2028.
“The peso will continue to be supported by structural foreign exchange inflows and firm macroeconomic fundamentals of the country,” the DBCC said.