Main Sectors of Industry

According to the latest data by the World Bank, the agricultural sector contributes to 9.5% of the Philippines’ GDP and employs around 24% of the labour force. Rice is the primary staple crop, with corn, coconut (the second-largest producer worldwide), sugarcane, bananas, and mangoes as significant contributors to the agricultural output. The country's fertile land and favourable climate conditions allow for the cultivation of a wide variety of fruits and vegetables, including pineapples, papayas, and vegetables such as eggplant and tomatoes. Livestock farming, including poultry, swine, and cattle, is also prominent, catering to domestic consumption and export markets. Despite the agricultural potential, challenges such as land reform issues, inadequate infrastructure, natural disasters, and climate change impacts persist, affecting productivity and sustainability in the sector. According to data from PSA, the full-year value of production in agriculture and fisheries at constant 2018 prices expanded by 0.4% in 2023, marking the first time agricultural output posted growth after three straight years of decline.

The industry sector contributes to 29.2% of GDP and employs 19% of the workforce. Industrial food processing is one of the Philippines' main manufacturing activities. The big industries are dominated by the production of cement, glass, chemicals products and fertilisers, iron, steel and refined oil products. While the sector's growth was halted in the initial stages of the pandemic, as response measures impeded manufacturing activity and reduced the global demand for industrial products, the Filipino industry showed a gradual recovery in the past few years. The logistics industry was particularly dynamic, driven by a recovery in both local and global demand in e-commerce, domestic manufacturing and the export sectors. In 2023, the annual average growth rate of the value of production index for manufacturing exhibited an expansion of 5.9%, while in terms of volumes, production increased by 4.4% (data PSA).

The tertiary sector - which represents 61% of GDP and employs 58% of the country’s workforce - has developed substantially, particularly in telecommunications, call centres and finance, business process outsourcing (BPO) and information technology services, with cities like Manila and Cebu emerging as global BPO hubs. Additionally, the tourism industry plays a significant role (5.45 million international visitors in 2023, still 44% below the pre-COVID level). The retail and wholesale trade sector is also prominent, reflecting the country's robust consumer market. Emerging sectors include fintech, e-commerce, and healthcare services, driven by technological advancements and evolving consumer preferences. With a young and tech-savvy population, the Philippines is poised to continue expanding its tertiary sector and diversifying its service offerings in the global market.

Source: World Bank - Latest available data.

Political Outline

Current Political Leaders

President: Ferdinand "Bongbong" MARCOS, Jr (since 30 June 2022)
Vice-President: Sara DUTERTE-Carpio (since 30 June 2022)

Next Election Dates

Presidential: May 2028
Senate: May 2025
House of Representatives: May 2025

Current Political Context

In May 2022, Filipinos went to the polls to cast their votes for the country's new president. Ferdinand "Bongbong" Marcos Jr, the son of a former long-serving president, Rodrigo Duterte, won the elections and succeeded him in office, while Duterte’s daughter, Sara Duterte-Carpio, became vice-president. As an ideological ally of former President Duterte, President Marcos is expected to continue the policy course pursued by the Duterte administration.
Among his government's notable policies that should continue with the new administration, are the country's intense campaign against drug crime, the rebalancing of relations with the U.S., strengthening ties with China (even though some tensions linger with relation to territorial disputes in the South China Sea), and closer cooperation with neighbouring Indonesia and Malaysia. Despite the vulnerability of its relationship with Beijing due to disputes over territories in the South China Sea, in early 2023, both countries pledged to address the issue through "friendly consultations". Meanwhile, the Philippines maintains historical ties with and receives growing military support from the U.S.: in February 2023, amid tensions between China and the United States' ally Taiwan, the Philippines granted the United States expanded access to its military bases.
Combating maritime piracy and terrorist groups were other priorities, as well as the introduction of universal health care (currently 93%) and free education from pre-school up to a basic university degree level, and boosting the Filipino economy. Furthermore, Marcos intends to go on with his father's “Build, Build, Build” programme, a centrepiece of the Duterte administration, which aims to usher in the “Golden age of infrastructure” in the Philippines and boost economic development in the country. To do so, the government aims to further develop the relationship with China, as investments from the country have been paramount for the success of the programme.
Lastly, in November 2023, the House of Representatives Committees on human rights and justice adopted two resolutions urging the government to collaborate with the International Criminal Court (ICC) in its investigation into the Duterte administration's drug war.

Main Political Parties

The Philippines has a multi-party system and political parties usually have diverse ideologies. As a result, parties generally work together to form coalition governments. The largest political parties in the country are:

- Lakas-Christian Muslim Democrats (Lakas-CMD): centre to centre-right, conservative political party with religious overtones
- Partido Demokratiko Pilipino-Lakas ng Bayan (PDP-Laban): centre-left, democratic socialism, populism
- National Unity Party (NUP): centre-right, Christian democracy
- Nationalist Party (NP): centre-right, conservatism, populism. Oldest party in the country and historically dominated the political arena
- Nationalist People's Coalition (NPC): centre-right, social and liberal conservatism
- Partido Federal ng Pilipinas (PFP): populist, federalist
- Liberal Party (LP): centre to centre-left, liberal, endeavours to tackle poverty and promote economic growth.

Executive Power

The President is both the Chief of State and head of Government and is directly elected by a popular vote to serve a single six-year term without the possibility of re-election, even if non-consecutive. He or she presides over and appoints the Cabinet members, and is also the Commander-in-Chief of the Armed Forces. The President holds the executive powers which include the implementation of the law in the country and running the day-to-day affairs. If the President resigns, is impeached or dies, the Vice President assumes the presidency.

Legislative Power

The legislature in the Philippines is bicameral. The parliament, called the Congress, consists of: the Senate (the upper house) having 24 seats with its members elected mostly by popular vote to serve (renewable) six-year terms, and the House of Representatives (the lower house) having 316 seats, with its members elected by popular vote to serve three-year terms - with a limit of three consecutive terms. The President has the power to veto acts of the legislature, and in turn a supermajority (generally two-thirds) of legislators may act to override his veto. The people of the Philippines enjoy considerable political rights.