Manila: The government will pursue reforms to boost economic growth amid current local and global challenges, the Department of Economy, Planning, and Development (DEPDev) said Friday. Philippine economic growth settled at 2.3 percent in the second quarter of the year, down from the 5.4 percent recorded in the same quarter last year.
According to Philippines News Agency, National Statistician Dennis Mapa highlighted that agriculture, forestry, fishing, and services grew by 2.7 percent and 4.5 percent, respectively, while the industry sector saw a decline of 2.4 percent due to a sharp contraction in public construction. DEPDev Secretary Arsenio Balisacan attributed the decline to cautiousness among infrastructure-related agencies and the impact of measures to prevent future incidents similar to past cases.
Household consumption growth moderated to 2.8 percent from 5.2 percent last year, weighed down by higher inflation, job losses, and lower remittance receipts due to the Middle East conflict. Meanwhile, the government's final consumption expenditure slowed slightly to 8.3 percent compared to 8.7 percent last year.
The second quarter of 2026 saw year-on-year growth in agriculture, forestry, and fishing, as well as services, with growth rates of 2.7 percent and 4.5 percent, respectively. This growth was partly driven by favorable weather conditions aiding agricultural output. Additionally, exports of goods and services accelerated to 12.2 percent, while imports increased to 5.5 percent, indicating a potential early stage of economic recovery.
Balisacan expressed optimism about the economy's trajectory, citing improving business confidence and encouraging private-sector indicators. He also noted hopes for easing inflation and moderation in disruptions due to the Middle East conflict. Despite the first-half slowdown, Balisacan remains optimistic about achieving the government's growth target with reforms and coordinated efforts.
To meet the 3.5 percent to 4.5 percent economic growth target for the year, the economy needs to grow by at least 4.4 percent in the second half. Balisacan highlighted plans to boost public construction and infrastructure spending, with the Department of Budget and Management releasing mobilization funds for 2026 projects.
The government aims to accelerate high-impact infrastructure projects, deepen governance reforms, and strengthen economic resilience. The Legislative-Executive Development Advisory Council (LEDAC) will prioritize key measures to promote governance reforms and economic development.
Additional measures include providing cash assistance, subsidies, and support for agriculture and energy sectors. The government is also pursuing trade negotiations with the European Union, Chile, and Canada and seeking adjustments to U.S. tariffs on selected exports. The use of artificial intelligence is also being considered to enhance growth.
Balisacan acknowledged the risks posed by the Middle East conflict, elevated oil prices, and potential natural disasters, emphasizing the government's commitment to monitoring developments and responding appropriately. The focus remains on sustaining recovery momentum to create more jobs, higher incomes, and better opportunities for Filipinos.
