ADB cuts Philippines' growth forecast to 5.6%

The Asian Development Bank (ADB) has revised its economic growth forecast for the Philippines downward to 5.6% this year, down from a previous estimate of 6.0%, citing external challenges such as global trade uncertainty and weaker domestic demand.

For next year, the ADB also lowered its forecast to 5.8% from an earlier projection of 6.1%, attributing the downgrades to higher U.S. tariffs and reduced exports due to global trade uncertainties.

The first-quarter expansion in the Philippines was reported at 5.4%, lower than expected, with net exports dragging on growth as imports outpaced exports.

ADB stressed that the Philippines is not alone: it also cut its growth outlook for developing Asia to 4.7% this year and Southeast Asia's growth outlook to 4.2%, citing similar economic headwinds.

The ASEAN+3 Macro-Economic Research Office (AMRO) also cut its Philippine economic growth outlook to 5.6% from an earlier projection of 6.3%, reflecting the impact of higher tariffs and a broader global demand slowdown.

U.S. President Donald Trump announced a reduction in tariffs on goods from the Philippines to 19% from 20%, though these benefits apply only to certain markets following his meeting with Philippine President Ferdinand 'Bongbong' Marcos Jr.

ADB Chief Economist Albert Park advised that economies in Asia and the Pacific should continue strengthening their fundamentals and promoting open trade and regional integration to support investment, employment, and growth.