PHILIPPINE President Ferdinand R. Marcos, Jr. on Thursday pledged to ramp up government spending within the fourth quarter, as a corruption scandal contributed to weaker-than-expected growth within the third quarter.
“Now we have implemented many measures because public spending will now be increased to be sure that by the top of the 12 months, the spending levels are aligned with our original plan — so we will recuperate what was lost within the third quarter,” Mr. Marcos said in mixed English and Filipino during a press briefing in Malacañang.
The Department of Budget and Management (DBM) earlier said it has programmed P1.31 trillion for disbursement through the October-to-December period to spice up economic growth.
Within the third quarter, the Philippine gross domestic product (GDP) growth slowed to a four-year low of 4% from the 5.5% expansion within the second quarter and 5.2% a 12 months ago.
The sharp economic slowdown was mainly attributed to the corruption mess that dampened government spending and affected consumer and investor confidence.
For the primary nine months of the 12 months, GDP growth averaged 5%, slower than 5.9% in the identical period last 12 months, and below the federal government’s 5.5-6.5% full-year goal.
The federal government is probing a multibillion-peso corruption scandal involving public works projects, where government officials allegedly colluded with private contractors to inflate costs and approve ghost infrastructure. It has affected investor confidence within the Philippines, weighing on the stock market and the Philippine peso.
Mr. Marcos vowed to place the culprits behind bars before Christmastime.
“They won’t have a Merry Christmas. Before Christmas, they will probably be jailed,” he said.
Mr. Marcos said the slowdown in economic activity within the third quarter will be partly blamed on the string of typhoons.
“There really was a downturn in economic activity. You might have to keep in mind that it’s not only due to these problems. Due to the typhoons, we lost working days within the economy,” he said.
Mr. Marcos also attributed the slower growth to the trade uncertainties, that are also affecting the worldwide economy.
“We should not the one ones suffering the shocks that come from the brand new trade structure that has been imposed on the remaining of the world. And so, we’re all adjusting to that,” he added.
Since Aug. 7, the US has imposed a 19% duty on many goods from the Philippines, Cambodia, Malaysia, Thailand and Indonesia.
DBCC TO REVIEW TARGETS
Meanwhile, the Development Budget Coordination Committee (DBCC) is about to review its macroeconomic assumptions and targets next week, Senate Committee on Finance Chairman Sherwin T. Gatchalian said.
Through the plenary debates for the 2026 national budget, Mr. Gatchalian said he is for certain there will probably be revision in the expansion targets.
“Next week the DBCC will once more meet and discuss this, possibly a revision by way of our 2025 economic growth, and in addition the succeeding years 2025-2028,” Mr. Gatchalian said.
This was in response to Senator Risa N. Hontiveros-Baraquel’s query if the weak third-quarter growth will prompt a revision of the DBCC targets.
“We will even have a rather lower economic growth forecast for the top of the 12 months, about… 4.7-5%, Mr. President. After which our debt to GDP will still be at 63%,” Mr. Gatchalian said.
In June, the DBCC tempered its growth forecast to five.5-6.5% for 2025 and 6-7% for 2026, mainly as a result of “heightened global uncertainties” arising from the Middle East conflict and US tariffs.
Mr. Gatchalian said there are plenty of aspects which have affected the expansion outlook, comparable to the series of typhoons and up to date earthquakes.
Last week, Economy Secretary Arsenio M. Balisacan warned that hitting the low end of the 5.5-6.5% growth goal can be “very difficult,” with more storms expected this quarter.
For next 12 months, Mr. Gatchalian flagged external headwinds comparable to US trade policies that can have a negative impact on growth.
At the identical time, Mr. Gatchalian said restoring public trust requires accountability, stressing that those involved within the flood control corruption scandal must face charges and be jailed before yearend.
“That’s why all of this flood control issue is giving us plenty of headache by way of outgrowing debt. But still, that’s why the administration is basically bent on holding people to account by putting them to jail, and that may bring back confidence and in turn revive our economic growth in the following quarter,” he said.
Filomeno S. Sta. Ana III, coordinator of Motion for Economic Reforms, said the slowdown in economic growth can also be as a result of the federal government’s lack of a “coherent” growth strategy.
“The essential reason why our GDP growth is below goal is that the present administration doesn’t have a coherent growth strategy, and worse has allowed or enabled policies and activities that undermine growth (diversion of pub-lic funds to Maharlika, revenue-eroding measures, transfer of PDIC (Philippine Deposit Insurance Corp.) and PhilHealth (Philippine Health Insurance Corp.) funds to National Government, ‘most corrupt budget,’ massive corruption, etc,” he said in a Viber message. — Chloe Mari A. Hufana and Aubrey Rose A. Inosante