Philippines Positioned for Stronger Philippine GDP Growth in 2026-2027, Says UN

The Philippines is set to accelerate its economic trajectory in 2026 and 2027, according to the United Nations’ latest World Economic Situation and Prospects report. The organization has projected Philippine GDP growth at 5.7% for this year, rebounding to 6.1% in 2027—a recovery driven by resilient consumer spending and moderating price pressures after previous challenges stemmed from governance controversies affecting public confidence.

UN Forecasts Signal Recovery Momentum

The United Nations expects the Philippine economy to benefit from favorable conditions including moderate inflation, healthy employment conditions, and consistent remittance inflows sustaining household spending. Government expenditure and capital investment are anticipated to provide additional momentum, creating a solid foundation for expansion. Both projections align comfortably within Manila’s official targets: 5-6% for this year and 5.5-6.5% for the coming year.

The growth rebound is particularly significant given that 2025 saw Philippine GDP expansion averaging approximately 5%, trailing the government’s 5.5-6.5% expectation and the previous year’s 5.7% performance. Economy officials attributed the slowdown to infrastructure project irregularities that dampened both government spending and market confidence.

Regional Performance: Philippines Among Asia’s Top Performers

Across Southeast Asia, the Philippines emerges as a standout performer in the medium term. Vietnam leads regional growth projections at 6% for 2026, with the Philippines trailing at 5.7%, followed by Cambodia (5.1%), Indonesia (5%), Malaysia (4%), Laos (3.8%), Timor-Leste (3.3%), Myanmar (3%), Thailand (2%), Singapore (1.8%), and Brunei (1.5%).

The rankings remain consistent in 2027, with Vietnam maintaining its lead at 6.2% and the Philippines sustaining strong momentum at 6.1%. This positions the archipelago as the region’s second-largest growth engine, significantly outpacing the broader East Asian average of 4.4%.

Inflation Outlook: Easing Price Pressures Expected

Price stability is bolstering the recovery narrative. The UN anticipates inflation moderating to 2.3% in 2026 and 2.8% in 2027, running below the central bank’s projections of 3.2% and 3% respectively. This favorable pricing environment has already emerged, with headline inflation registering at 1.8% in December, bringing the 2025 annual average to 1.7%—a substantial pullback that has provided households breathing room for consumption.

The Philippine Statistics Authority will release official fourth-quarter and full-year 2025 economic data on January 29, which should clarify the exact transition metrics and confirm whether the recovery trajectory aligns with these optimistic international assessments.