By Aubrey Rose A. Inosante, Reporter
The Asian Development Bank (ADB) sharply cut its growth forecasts for the Philippines for this yr and 2026, amid weak infrastructure spending on account of corruption probe and natural disasters.
In its December Asian Development Outlook, the multilateral lender slashed its Philippine gross domestic product (GDP) growth forecast to five% from 5.6% in September.
For 2026, the ADB trimmed its Philippine growth forecast to five.3% from 5.7% previously.
These latest projections are below the federal government’s 5.5-6.5% goal for this yr, and the 6-7% growth goal for 2026 to 2028.
In its report released on Wednesday, the ADB said the lower growth prospects for the Philippines was “on account of weak infrastructure spending amid investigations of publicly funded projects, and natural hazards.”
The Philippine economy expanded by a weaker-than-expected 4% within the third quarter, bringing nine-month growth to five%, on account of lower government spending on flood control projects amid investigations and stricter controls.
Data from the Department of Budget and Management showed expenditure on infrastructure and other capital outlays for the January-to-September period, declined by 10.7% to P877.1 billion from P982.4 billion a yr ago.
“Low inflation and ongoing monetary easing should sustain domestic demand, supporting stronger growth in 2026,” the ADB said.
“Nonetheless, uncertainties arising out of investigations of publicly funded infrastructure projects and weather-related disruptions pose downside risks,” it added.
The multilateral lender expects headline inflation to average 1.8% this yr and three% in 2026, unchanged from its September forecast.
That is barely higher than the Bangko Sentral ng Pilipinas’ (BSP) 1.7% average forecast for this yr, but lower than the three.3% average forecast for 2026.