The Philippines has made notable gains from trade-driven growth, but sustaining that momentum will require a sharper focus on reducing trade costs, improving logistics, and streamlining border procedures, according to the World Trade Organization (WTO).
In its latest Trade Policy Review (TPR) released on June 24, the WTO Secretariat said trade and investment have been central to the country’s economic expansion, helping create better-paying jobs, enlarge the middle class, and reduce poverty over the past decade.
The figures underscore the progress. Trade in goods and services accounted for more than 60 percent of gross domestic product from 2018 to 2025, while poverty incidence fell to 15.5 percent in 2023 from 26.3 percent in 2015. Export-oriented industries also helped expand the middle class to more than 40 percent of the population.
Yet the WTO warned that the country continues to face a competitiveness challenge that could limit future gains.
Despite years of reforms, the Philippines still posts some of the highest trade costs in Southeast Asia. Logistics expenses account for an estimated 27 percent of retail prices, while overall trade costs remain roughly 20 percent above the ASEAN average due to infrastructure bottlenecks and regulatory inefficiencies.
The message from Geneva is clear. The next wave of reforms must move beyond market opening and focus on making trade faster, cheaper, and more predictable.
Among the measures identified by the WTO are the accelerated rollout of the National Single Window, the establishment of non-preferential rules of origin, and the revival of the Unified Logistics Pass initiative. These reforms are expected to reduce transaction costs, improve supply chain efficiency, and strengthen the country’s position in regional and global value chains.
The review acknowledged progress in investment liberalization, customs modernization, public-private partnership reforms, and permit streamlining. However, it noted that improving logistics and regulatory efficiency will be crucial if the Philippines hopes to attract more investment, boost exports, and advance toward upper-middle-income status.
A summary of the two-day review is expected after discussions conclude on June 26.
