SM Group upbeat for 2026 amid investor caution, political noise

The SM Group is keeping an optimistic outlook for 2026 even as political noise and investor caution weigh on sentiment, as it bets on "pockets of opportunities" such as provincial expansion to spur growth moving forward.

"The next year will not be so bad if we think more positively. We just have to do our work in spite of all the political noises, so for us we're going to continue what we have planned, and I think we will be able to achieve our targets next year," SM Investments Corp. Vice Chairman Teresita Sy-Coson told reporters in Pasig City.

Both chambers of Congress are now looking into alleged irregularities in public works spending, after President Ferdinand "Bongbong" Marcos Jr. in August disclosed that 20% of the total P545-billion budget for flood control projects went to only 15 contractors, which he described as a "disturbing assessment."

The controversy has hit government spending on public works and dampened consumer and investor sentiment, leading Department of Economy, Planning, and Development (DepDev) Secretary Arsenio Balisacan to concede that the country is unlikely to achieve its economic growth target for the third straight year in 2025.

The Marcos administration has also established the fact-finding Independent Commission for Infrastructure (ICI), in response to public calls for greater transparency and accountability in infrastructure spending. It is tasked to conduct an in-depth investigation into the alleged irregularities and misuse of funds in flood control, and other infrastructure projects. The commission's own officials, however, have raised concerns that it lacks budget and enabling laws to give it more teeth in stomping out corruption in government.

BDO Unibank President and Chief Executive Officer Nestor Tan attributed the risks for a "rollercoaster year" this 2025, with the possibility that these will spillover to 2026.

"From a business perspective, it's tough this year and we continue to think that 2026 will end the same because the business is uncertain," he said.

"The business community is not sure what's likely to happen and therefore, if they're not sure, they will hold back. Not because they don't want to invest, but they will hold back a little and we expect that to happen going into 2026," he added.

Tan noted, however, that there are still "pockets of opportunities" in provincial expansions outside Metro Manila.

"Outside of the environment that we see, we still see provincial expansion going on. It's growing faster than NCR (National Capital Region) on the average, so we still see some positive light there. We still see some activity in infrastructure, in energy and the like, people continue to invest," he said. — VDV, GMA Integrated News