Philippines posts worst economic growth since 2011

January 29, 2026 / 10:50 AM

Sharjah24-AFP: The Philippine economy recorded its slowest non-pandemic growth in 14 years in 2025, expanding by 4.4 percent, according to official data released on Thursday. The result was well below the revised mid-year projection of 5.5 to 6.5 percent and marked the weakest full-year performance since 2011, excluding the contraction during the Covid-19 pandemic.

Economic growth slowed to 3.0 percent in the fourth quarter, down from 5.3 percent a year earlier, marking the second consecutive quarter in which growth targets were missed.

Impact of corruption scandal

Data showed that a major corruption scandal linked to fraudulent infrastructure and flood-control projects severely undermined business and consumer confidence. Construction activity and public investment declined sharply, contributing to the weaker overall growth performance.

Weather disruptions add pressure

Adverse weather and climate-related disruptions, including heatwaves, flooding, work stoppages and school closures, further dampened domestic demand throughout the year.

Outlook remains cautious

Analysts warned that economic growth is likely to remain subdued in 2026 due to the sharp decline in public investment, although low inflation may provide scope for near-term interest rate cuts.