Filtered By: Money

Philippines likely to achieve upper middle-income status by 2025 - Balisacan

The Philippines is likely to achieve its target of becoming an upper middle-income economy by 2025, a year later than what the government expected, Socioeconomic Planning Secretary Arsenio Balisacan said Saturday.

In his first State of the Nation Address in July, President Ferdinand Marcos Jr. said his administration is looking to bring the Philippines to "upper-middle income status by 2024" with "at least $4,256 income per capita."

"[But] because of the sharp contraction of the economy in 2020 and the sharp depreciation of the peso this year, the entry into that category of countries - upper middle-income country - will now be 2025," Balisacan said during the weekly Saturday News Forum at Dapo Restobar in Quezon City.

Under the World Bank’s updated standards, an upper middle-income economy or country has a gross national income (GNI) per capita of between $4,046 and $12,535.

The previous administration aspired to bring the country to upper-middle income status by 2020, but the economy went into a recession due to the pandemic.

In 2019, the Philippines was categorized as a lower-middle income country with a GNI per capita of between $1,006 and $3,955.

Data from the Philippine Statistics Authority (PSA) showed the country’s GNI per capita stood at P182,438 (about $3,300) last year, higher than the peak of the pandemic year 2020 of P177,546 (about $3,200) but still lower than the pre-pandemic GNI per capita of P200,135 (about $3,600) in 2019.

Nevertheless, Balisacan expressed confidence that the country’s GNI per capita will hit $4,456 by 2025 "because at that level of per capita income, that’s when we meet the threshold of joining upper-middle economies."

The target of achieving upper middle-income status is contained in the Philippine Development Plan (PDP) 2023–2028, the country’s blueprint for socioeconomic development over the medium term, which was approved by Marcos on Friday.

“Completed in record time – just six months into President Marcos’ term – the PDP is our plan for economic and social transformation. In the next six years, our overall goal is to reinvigorate job creation and accelerate poverty reduction by steering the economy back to its high-growth path. More importantly, the Plan seeks to effect economic transformation toward a prosperous, inclusive, and resilient society,”  Balisacan said.

The NEDA chief said the PDP is framed by Marcos’ eight-point socioeconomic agenda, which seeks to address short-term issues confronting the country and medium-term constraints on rapid growth and inclusion.

The PDP is also geared toward the realization of the AmBisyon Natin 2040, the Filipino people’s collective vision for the long term.

Some of the socioeconomic targets under the plan are the following:

  • Annual real gross domestic product growth of 6.0%-7.0% in 2023 and 6.5%-8.0% from 2024 to 2028
  • Headline inflation and food inflation of 2.5%-4.5% in 2023 and 2.0%- 4.0% from 2024 to 2028
  • Reduction of unemployment to 4.0%-5.0% in 2028 from an average of 5.4% in 2022 while increasing the share of wage and salaried workers in private establishments from 49.6% on average in 2022 to 53.0%-55.0% in 2028
  • National government debt stock to GDP ratio reduced to 48.0%- 53.0% in 2028 from 63.7% in 2022
  • Poverty incidence reduced from 18.1% in 2021 to a single-digit level of 8.8%-9.0% in 2028

“Given the uncertainties and headwinds that we face, the Plan is our roadmap that will show us the way forward, guiding our efforts and initiatives as we sustain our robust economic recovery and aspire for no less than the economic and social transformation of our country towards a matatag, maginhawa, at panatag na buhay for all Filipinos,” Balisacan said. —VBL, GMA Integrated News