The Philippine economy is poised for a faster growth run in the next two years, cementing its place among Southeast Asia’s top performers, according to the United Nations’ World Economic Situation and Prospects 2026 report released January 8.
The UN projects Philippine gross domestic product (GDP) growth at 5.7 percent in 2026 and an even stronger 6.1 percent in 2027, rebounding from a softer 5 percent estimate for 2025.
If realized, the 2027 figure would make the Philippines the second fastest-growing economy in Southeast Asia, trailing only Vietnam at 6.2 percent and edging out Cambodia’s 5.5 percent, and Indonesia’s 5.2 percent.
The outlook suggests momentum returning after a bumpy 2025. Official data showed GDP growth slowed to 4 percent year-on-year in the third quarter of 2025, the weakest pace in several years, as investment and household spending cooled amid tighter financial conditions and lingering global uncertainty.
Still, the UN flagged several domestic buffers. Low inflation, a resilient labor market, and steady remittance inflows continue to support consumer spending, while government spending and investment have helped cushion the slowdown. Inflation, while projected to rise to 2.3 percent in 2026 and 2.8 percent in 2027, remains within the government’s 2 to 4 percent target range, signaling manageable price pressures.
The projections broadly align with the government’s own targets. Authorities are aiming for 5.5 to 6.5 percent growth in 2025 and 6.0 to 7.0 percent annually from 2026 to 2028, banking on infrastructure rollout, easing inflation, and stronger domestic demand.
The key risk, analysts note, lies in execution. Translating upbeat forecasts into reality will hinge on reviving private investment, sustaining fiscal support without overheating inflation, and navigating global headwinds. If these fall into place, the Philippines could reassert itself as one of the region’s most dynamic growth stories by 2027.
