<\/p>\n
PHILIPPINE growth could slow to three.79% in 2026 if the war within the Middle East is prolonged and becomes a routine feature of the economy, De La Salle University (DLSU) said in a report.<\/p>\n
Of their Report of the Philippine Economy for April, DLSU economists said their prolonged-war growth scenario represents a downgrade from a 4.19% estimate in March.<\/p>\n
\u201cIf it materializes, it might represent a major deceleration with respect to the already low growth rate of 2025 (4.4%),\u201d the report said.<\/p>\n
\u201cWe insist that if the war continues, the Philippine economy (already beset by corruption induced pessimism and weak capital formation) will remain sluggish\u2014 even with Iran guaranteeing secure passage for Philippine vessels along the Strait of Hormuz,\u201d it added.<\/p>\n
If the forecast is realized, growth will fall below the federal government\u2019s 5-6% gross domestic product growth goal for 2026.<\/p>\n
\u201cMedium-term growth is predicted to enhance barely. We forecast growth to hit 4.23% in 2027 and 4.17% in 2028. Each figures remain substantially below the federal government\u2019s growth targets of 5.5-6.5%,\u201d the report said.<\/p>\n
\u201cThis estimate seems to point to a protracted period of subdued capital formation that constrains potential growth well beyond the immediate crisis,\u201d it added.<\/p>\n
The federal government declared a one-year national energy emergency last month in response to the war that broke out within the Middle East.<\/p>\n
Meanwhile, the economists said inflation is predicted to hover near or above the upper certain of the 2-4% goal band through the top of the yr, citing \u201ca set of risks unlikely to vanish any time soon.\u201d<\/p>\n
\u201cAny further disruptions to the availability of oil would push global energy prices higher and domestic prices would likely follow suit,\u201d it said.<\/p>\n
\u201cIn other words, even when global conditions calm down, inflation could remain elevated well into the second half of the yr. The Philippine economy may start showing symptoms of stagflation,\u201d it added.<\/p>\n
Philippine inflation accelerated to a virtually two\u2011yr high of 4.1% in March, breaching the Bangko Sentral ng Pilipinas\u2019 (BSP) 2-4% goal.<\/p>\n
The report said fiscal and monetary authorities face a set of critical decisions because the crisis unfolds.<\/p>\n
\u201cRepeated supply shocks are complicating rate of interest decisions, while elevated financial vulnerabilities are making policy transmission less predictable,\u201d it said.<\/p>\n
\u201cClear communication, effective macro-prudential measures, and stronger coordination with fiscal policy are essential to anchor expectations and safeguard growth and stability,\u201d it added.<\/p>\n
The BSP kept its policy rate unchanged at 4.25% during a surprise off-cycle meeting last month, ahead of the Monetary Board\u2019s regular policy meeting on April 23.<\/span><\/p>\n \u201cFiscal policy must balance targeted protection with macroeconomic stability,\u201d the report said.<\/span><\/p>\n \u201cConsistent with the principles of sound finance, the federal government\u2019s initial response reflects two most important objectives: providing targeted relief to economically vulnerable groups and maintaining fiscal discipline to safeguard the state\u2019s financial position,\u201d it added.<\/p>\n It said that \u201cwell-designed, temporary, and targeted measures can shield vulnerable groups and sustain social cohesion, while credible fiscal trajectories and coherent coordination with monetary policy are essential to contain inflationary risks.\u201d<\/p>\n It added that the federal government should address structural bottlenecks in food, energy, transport, and logistics.<\/p>\n \u201cIt will require adopting a more structural perspective \u2014 one that permits for a considerable reorientation of fiscal policy,\u201d it said.<\/span><\/p>\n \u201cSuch an approach would move beyond selective relief and monetary preservation toward actively supporting the productive sectors of the economy, sustaining employment, and constructing the fabric capability needed for a more practical collective response to future crises,\u201d it added. \u2014 Justine Irish D. Tabile<\/b><\/p>\n<\/p><\/div>\n <\/p>\n","protected":false},"excerpt":{"rendered":" Smoke rises within the sky after blasts were heard in Manama, Bahrain, February 28, 2026. \u2014 REUTERS\/STRINGER PHILIPPINE growth could slow to three.79% in 2026 if the war within the Middle East is prolonged and becomes a routine feature of the economy, De La Salle University (DLSU) said in a report. Of their Report of […]<\/p>\n","protected":false},"author":1,"featured_media":317676,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[22366,3431,17176,50536,10496],"class_list":["post-317675","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-cutting","tag-growth","tag-phl","tag-prolongedwar","tag-scenario"],"aioseo_notices":[{"message":"The permalink for this post just changed! This could result in 404 errors for your site visitors.","status":"warning","options":{"id":"0a2ae5f84bc2c0423042ed7ec22d2e40","isDismissible":true,"actions":[{"url":"https:\/\/ebiztoday.news\/wp-admin\/admin.php?page=aioseo-redirects","label":"Add Redirect to improve SEO","class":"aioseo-redirects-slug-changed"}]},"allowedContexts":["posts"]}],"_links":{"self":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/317675","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/comments?post=317675"}],"version-history":[{"count":2,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/317675\/revisions"}],"predecessor-version":[{"id":317678,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/317675\/revisions\/317678"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/media\/317676"}],"wp:attachment":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/media?parent=317675"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/categories?post=317675"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/tags?post=317675"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}