Philippines Economic Outlook
A fast-growing consumer-driven economy:
The Philippines has been one of Asia’s fastest-growing economies in recent years, supported by strong domestic consumption, a young workforce, and a rapidly expanding services sector. The country’s GDP growth has averaged around 6% over the past decade, although it suffered a deep contraction in 2020 due to the COVID-19 pandemic. The economy has since rebounded, with remittances from overseas workers, robust business process outsourcing (BPO) services, and infrastructure investments driving growth.
Services and remittance-driven growth:The Philippines is a global leader in the BPO industry, with companies outsourcing customer service, IT, and financial operations to the country due to its skilled, English-speaking workforce. The BPO sector contributes significantly to employment and foreign exchange earnings. Additionally, remittances from overseas Filipino workers, which account for nearly 10% of GDP, provide a critical buffer against external economic shocks and sustain household consumption.
Infrastructure and manufacturing potential:President Ferdinand Marcos Jr. has prioritized infrastructure investment under the Build, Better, More program, aiming to upgrade transport, energy, and digital infrastructure. However, manufacturing lags behind regional peers, and the country’s heavy reliance on imports for key goods contributes to a persistent trade deficit. The government is seeking to attract foreign investment in manufacturing, particularly in electronics, automotive, and renewable energy sectors.
Philippines economic outlook:The Philippines’s economy is set to maintain strong growth in the coming years, but risks remain, including high inflation, fiscal constraints, and vulnerability to natural disasters. Political stability and structural reforms will be crucial to sustaining long-term development. The country’s youthful population, growing middle class, and expanding digital economy present significant opportunities, though addressing infrastructure gaps and trade imbalances will be key to unlocking its full economic potential.
Philippines' Macroeconomic Analysis:
Nominal GDP of USD 462 billion in 2024.
GDP per capita of USD 4,078 compared to the global average of USD 10,589.
Average real GDP growth of 4.9% over the last decade.
Sector Analysis
In 2022, services accounted for 62% of overall GDP, manufacturing 16%, other industrial activity 13%, and agriculture 9%. Looking at GDP by expenditure, private consumption accounted for 77% of GDP in 2023, government consumption 14%, fixed investment 23%, and net exports -14%.International trade
In 2021, manufactured products made up 80% of total merchandise exports, mineral fuels 1%, food 8%, ores and metals 8% and agricultural raw materials 1%, with other categories accounting for 2% of the total. In the same period, manufactured products made up 65% of total merchandise imports, mineral fuels 16%, food 14%, ores and metals 4% and agricultural raw materials 1%, with other goods accounting for 0% of the total. Total exports were worth USD 73 billion in 2024, while total imports were USD 127 billion.Main Economic Indicators
Economic growthThe economy recorded average annual growth of 4.9% in the decade to 2024. To read more about GDP growth in the Philippines, go to our dedicated page.
Fiscal policy
Philippines's fiscal deficit averaged 4.0% of GDP in the decade to 2023. Find out more on our dedicated page.
Unemployment
The unemployment rate averaged 6.0% in the decade to 2024. For more information on Philippines's unemployment click here.
Inflation
Inflation averaged 3.4% in the decade to 2024. Go to our Philippines inflation page for extra insight.
Monetary Policy
The Philippines monetary policy rate ended 2024 at 5.75%, up from 4.00% a decade earlier. See our Philippines monetary policy page for additional details.
Exchange Rate
From end-2014 to end-2024 the peso weakened by 22.7% vs the U.S. dollar. For more info on the peso, click here.
Economic situation in Philippines
Our panelists expect annual GDP growth to sharpen in Q1 2025 from the previous quarter as recent interest rate cuts support domestic demand, and the front-loading of shipments ahead of U.S. tariff hikes boosts exports. Available data backs this prediction. In January, manufacturing output rebounded from Q4’s slump, and goods exports also recovered. That said, growth in remittances inflows fell below the prior quarter average in the same month, as did that of tourist arrivals. In other news, former President Rodrigo Duterte was recently arrested on the orders of the International Criminal Court for crimes against humanity concerning his “war on drugs” campaign during his 2016–2022 term. This could antagonize Duterte supporters and cause social unrest, undermining support for the Marcos administration at the May midterm elections.Philippines Economic Forecasts
Projections out to 2034.53 indicators covered including both annual and quarterly frequencies.
Consensus Forecasts based on a panel of 35 expert analysts.
Want to get insight on the economic outlook for Philippines in the coming years? FocusEconomics collects projections out to 2034 on 53 economic indicators for Philippines from a panel of 35 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts, and averaged to provide one Consensus Forecast you can rely on for each indicator. This means you avoid the risk of relying on out of date, biased or outlier forecasts. Our Consensus Forecasts can be visualized in whichever way best suits your needs, including via interactive online dashboards , direct data delivery and executive-style reports which combine analysts' projections with timely written analysis from our in-house team of economists on the latest developments in the Philippines economy. To download a sample report on the Philippines' economy, click here. To get in touch with our team for more information, fill in the form at the bottom of this page.