S&P cuts 2024 PH growth forecast to 5.7%

S&P Global Ratings has trimmed its growth forecast for the Philippines this year, but at the same time increased the estimate for 2025.

In a statement on Tuesday, the debt watcher placed the country’s gross domestic product (GDP) growth at 5.7 percent this year, a tad lower than the 5.8 percent previously. Meanwhile, it increased next year’s forecast to 6.2 percent from 6.1 percent.

Both forecasts, however, are still below the government’s 6 to 7 percent and 6.5 to 7.5 percent growth targets for 2024 and 2025, respectively.

READ: S&P raises Philippine outlook for 2026

The Philippine economy grew by 6.3 percent in the second quarter, driven by increased state spending and strong investments that offset the adverse impact of high consumer prices on household spending.

The country’s growth rate outpaced Indonesia’s 5.05 percent, China’s 4.7 percent and Malaysia’s 5.8 percent, but fell behind Vietnam’s 6.9 percent.

“In all, we project 4.4 percent GDP growth in 2024 in Asia-Pacific, compared with 4.5 percent three months ago. We see the region expanding 4.4 percent again next year,” the report said.

S&P identified growth risks in the region which include reduced growth in China, weaker domestic consumption in the region as well as a sharper-than-expected slowdown in the US economy.

In a different statement, Finance Secretary Ralph Recto expects the economy to expand by 6.1 percent this year.

“We have a medium-term fiscal framework plan and they see our plan as credible. Number one, the economy is continuously growing—second quarter growth was 6.3 percent; for the entire year 6.1 percent; for the first two years of the President, on average, 6 to 6.1 percent–one of the highest for all presidents since we began tracking GDP,” Recto said during a Palace briefing on Tuesday.

Further, Recto noted that the government’s fiscal plan is to reduce the deficit to about 3.8 percent by 2028.