The OECD released its first Economic Survey of the Philippines, projecting GDP growth to accelerate to 5.1% in 2026 and 5.8% in 2027 from 4.4% in 2025, while inflation is expected at 2.6% in 2026 and 3.0% in 2027, at the mid-point of the central bank’s target range. The report argues that sustaining the growth trajectory will require stronger competition, measures to support formal job creation, fiscal prudence, and intensified climate action. On fiscal policy, the Survey calls for continued discipline to put public debt on a prudent path and recommends phasing out value-added tax exemptions for private healthcare, education and senior citizens alongside targeted social transfers, as well as addressing corruption in public investment to improve spending efficiency and the investment climate. To boost productivity, it prioritises competition reforms in electricity and telecommunications, including effective separation between network infrastructure and generation and open-access network rules requiring incumbents to share infrastructure at regulated tariffs, and urges streamlined administrative procedures across the economy including for foreign investors. Proposed labour and social measures include a unified, multi-tiered social protection system with universal core benefits funded by general tax revenues and top-up benefits financed by progressive social contributions, and aligning minimum wages more closely with regional productivity to reduce informality. Climate recommendations include directing adaptation investment towards areas where poverty and climate risks coincide, improving flood management, strengthening Metro Manila water pricing to address land subsidence from groundwater extraction, expanding home insurance, and increasing the coal excise tax to accelerate the phase-out of coal-based power generation.
OECD 2026-02-12
OECD Economic Survey of the Philippines forecasts GDP growth rising to 5.1% in 2026 and urges pro-competition and formal employment reforms
The OECD's first Economic Survey of the Philippines forecasts GDP growth to rise to 5.1% in 2026 and 5.8% in 2027, with inflation at 2.6% and 3.0% respectively, within the central bank's target range. The report emphasizes the need for stronger competition, fiscal prudence, and climate action, recommending reforms in fiscal policy, productivity, labour, and climate measures to sustain growth and improve economic conditions.