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Economic Overview

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

The Philippines' economy is considered as one of the most dynamic economies in East Asia and the Pacific. In 2022, GDP grew by an estimated 6.5%, mainly due to an increase in private domestic consumption and fixed investment. However, although the Filipino economy has been recovering since the outbreak of the COVID-19 pandemic, recovery has yet to reach full momentum due to persistent downside pressures. According to the IMF, GDP growth is expected to slightly decrease to 5% in 2023 before picking up to 6% in 2024. Key economic drivers include solid fundamentals, a competitive workforce, a stable job market, steady remittances, and investment in the construction sector (World Bank).

The Philippines' public deficit reached 5.4% of GDP in 2022 and it is expected to decrease to 4.7% in 2023 and 3.7% in 2024. Public debt increased to 59.3% of GDP in 2022 and is expected to further increase in 2023 and 2024, to 61% and 61.2%, respectively. Inflation rate also increased in 2022, reaching 5.3% and surpassing the Central Bank’s limit of 4%, mainly due to higher commodity prices and global supply factors. However, according to the IMF, inflation is expected to decrease to 4.3% in 2023 and 3.1% in 2024. Domestic consumption is expected to remain the main driver of the economy, accounting for 70% of GDP. Institutional reforms are needed in business freedom, investment freedom, and rule of law, according to the Heritage Foundation. The COVID-19 crisis has revealed long-existing cracks in the country’ systems and institutions, and the government estimates that the Filipino economy could take a decade to return to pre-pandemic growth. Nevertheless, the Philippines have been gradually recovering following the initial impact of the pandemic, mainly boosted by the government’s policy reforms and expansionary fiscal program.

In 2022, the unemployment rate decreased to 5.7% - a trend that's expected to continue in 2023 (5.4%) and 2024 (5.1%). Inequality in wealth distribution and poverty rates are estimated to have worsened after the pandemic, pushing around 2.7 million more Filipinos into poverty, to a total of 23.7% of the population living in poverty. Nevertheless, one of the government's main goals is to reduce the poverty rate and increase equality among Filipino society.

Main Indicators 202020212022 (E)2023 (E)2024 (E)
GDP (billions USD) 361.75394.09404.26440.90475.65
GDP (Constant Prices, Annual % Change) -
GDP per Capita (USD) 3,3263,5763,6233,9054,166
General Government Balance (in % of GDP) -3.3-5.4-5.4-4.3-3.7
General Government Gross Debt (in % of GDP) 51.657.057.556.756.8
Inflation Rate (%)
Unemployment Rate (% of the Labour Force)
Current Account (billions USD) 11.58-5.94-17.83-11.05-11.31
Current Account (in % of GDP) 3.2-1.5-4.4-2.5-2.4

Source: IMF – World Economic Outlook Database , October 2021

Country Risk

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Main Sectors of Industry

The Philippines' economy is based on food processing; production of cement, iron, and steel; and telecommunications, among others. According to the latest rates by the World Bank, the agricultural sector contributes to 10.1% of GDP and employs 22.9% of the labour force. The Philippines is the second largest producer of coconuts in the world. However, the agricultural sector suffers from low productivity, weak economies of scale and inadequate infrastructure. Still, the government is working on restructuring and modernising the sector, and have been implementing policies such as converting government lands to agriculture use. As for mining, the Philippines are one of the richest countries of the world in terms of minerals with an unexploited mineral wealth estimated at more than USD 840 billion (Inquirer). The Philippines reserves of copper, gold and zinc are also among the largest in the world. In 2021, Typhoon Odette hit the country, damaging hundreds of metric tons of rice crops and, despite efforts to improve production in 2022, the sector was still deeply affected by the lasting impacts of the typhoon.

The industry sector contributes 28.9% of GDP and employs 19.1% of the workforce. Industrial food processing is one of the Philippines' main manufacturing activities. The big industries are dominated by 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, he Filipino industry showed a gradual recovery in the past few years. The logistics industry was particularly dynamic, driven by recovery in both local and global demand in e-commerce, domestic manufacturing and the export sectors.

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. Government goals for the sector include attracting investments in human resource development, design, R&D, finance, and infrastructure; bolstering manufacturing-derived services; and establishing new ecosystems linked with manufacturing (Department of Trade and Industry and Board of Investments). Although the services sector was hit the hardest during the pandemic, it showed a steady recovery in 2022, mainly driven by the wholesale, retail trade, information and communication, accommodation and food service activities, and human health and social work activities.

Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 22.9 19.1 58.0
Value Added (in % of GDP) 10.1 28.9 61.0
Value Added (Annual % Change) -0.3 8.5 5.4

Source: World Bank - Latest available data.

Monetary Indicators 20162017201820192020
Philippine Peso (PHP) - Average Annual Exchange Rate For 1 USD 47.4950.4052.6651.8049.62

Source: World Bank - Latest available data.



Foreign Trade

Foreign trade represented 63.5% of the country's GDP in 2021, according to the World Bank. Main exports included electronic integrated circuits and microassemblies (32.3%), automatic data processing machines and units (5%), wires and cables (3.6%), printing machinery (3.4%), and copper (3%); while imports are focused on electronic integrated circuits and microassemblies (12.4%), petroleum oils (7.5%), telephone sets (2.7%), coal (2.3%), and machine parts and accessories (2.1%). According to IMF Foreign Trade Forecasts, the volume of exports of goods and services increased by 4% in 2022 and is expected to increase by 4.5% in 2023, while the volume of imports of goods and services increased by 14.9% in 2022 and is expected to increase by 5.7% in 2023.

Main export destinations include the U.S., China, Japan, Hong Kong, and Singapore; while main imports arrive from China, Japan, South Korea, Indonesia, and the U.S.. The main risk factor to foreign trade in the Philippines and countries in the region is the trade dispute between the U.S. and China, which slows exchanges in the world. The Philippines has recently lifted quantitative restrictions on imports of all food products, including rice. However, Tariff-Rate Quotas still remain on a number of sensitive products such as corn, poultry meat, pork, sugar, and coffee. The country is part of a number of trade agreements, including the Asia Free Trade Agreement, the Asia Europe Meeting (ASEM), the Japan-Philippines Economic Partnership Agreement (JPEPA), the ASEAN-Australia-New Zealand Free Trade Agreement; and the ASEAN-China Free Trade Area.

Traditionally, the country's trade balance has been in deficit due to high imports of raw materials and intermediate goods. The 2021 trade balance (including services) closed at USD - 38,7 million, while the trade deficit without services was higher, at USD - 52.8 million. Membership to ASEAN (the Association of Southeast Asian Nations) has played a key role in the Philippines' expanding commerce overseas and, as such, exports should increase in the coming years. According to WTO data, in 2021, the Philippines exported USD 74,6 million worth of goods and imported USD 124,3 million worth of goods. As with regards to services, the country's exports value exceeded the imports value by reaching USD 33,6 million and USD 19,4 million, respectively.

Foreign Trade Values 20172018201920202021
Imports of Goods (million USD) 101,901119,329117,37490,654124,386
Exports of Goods (million USD) 68,71369,30770,92763,76774,618
Imports of Services (million USD) 25,84526,27127,68617,74619,453
Exports of Services (million USD) 34,81338,37841,24531,39133,627

Source: World Trade Organisation (WTO) ; Latest available data

Foreign Trade Indicators 20172018201920202021
Foreign Trade (in % of GDP)
Trade Balance (million USD) -40,215-50,972-49,312-33,775-52,806
Trade Balance (Including Service) (million USD) -31,522-39,364-36,272-19,909-38,718
Imports of Goods and Services (Annual % Change)
Exports of Goods and Services (Annual % Change) 17.411.82.6-16.18.0
Imports of Goods and Services (in % of GDP) 38.641.940.533.037.8
Exports of Goods and Services (in % of GDP) 29.630.228.425.225.7

Source: World Bank ; Latest available data

Foreign Trade Forecasts 20222023 (e)2024 (e)2025 (e)2026 (e)
Volume of exports of goods and services (Annual % change) 10.510.
Volume of imports of goods and services (Annual % change) 13.216.610.67.27.5

Source: IMF, World Economic Outlook ; Latest available data

Note: (e) Estimated Data

International Economic Cooperation
The Philippines is a member of the following international economic organisations: IMF, Asia-Pacific Economic Cooperation (APEC), ICC, Association of Southeast Asian Nations (ASEAN), Colombo Plan, G-24, G-77, WTO, among others. For the full list of economic and other international organisations in which participates the Philippines click here. International organisation membership of the Philippines is also outlined here.
Free Trade Agreements
The Philippines is a member of Regional Comprehensive Economic Partnership (RCEP) signed on 15 November 2020. The complete and up-to-date list of Free Trade Agreements signed by the Philippines can be consulted here.

Main Partner Countries

Main Customers
(% of Exports)
United States 15.8%
Japan 14.1%
China 13.9%
Hong Kong SAR, China 13.3%
Singapore 6.2%
See More Countries 36.7%
Main Suppliers
(% of Imports)
China 20.4%
Indonesia 9.6%
Japan 9.0%
South Korea 8.7%
United States 6.6%
See More Countries 45.7%

Source: Comtrade, 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 distancing from the U.S. to strengthen relations with China (even though some tensions linger with relation to territorial disputes in the South China Sea), and closer ties with neighbouring Indonesia and Malaysia. 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 boost 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 the “Golden age of  infrastructure” in the Philippines and boost economic development in the country. To do so, the government aims to further develop their relationship with China, as investments from the country have been a paramount for the success of the programme.
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:

- Partido Demokratiko Pilipino-Lakas ng Bayan (PDP-Laban): centre-left, democratic socialism, populism
- 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
- Lakas-Christian Muslim Democrats (Lakas-CMD): centre to centre-right, conservative political party with religious overtones
- Liberal Party (LP): centre to centre-left, liberal, endeavours to tackle poverty and promote economic growth
- United Nationalist Alliance (UNA): centre-right, Filipino nationalism, conservatism

Other notable parties include:
National Unity Party (NUP), Aksyon Demokratiko (Democratic Action), Pwersa ng Masang Pilipino (Force of the Filipino Masses PMP), Laban ng Demokratikong Pilipino (LDP), Kilusang Bagong Lipunan (New Society Movement KBL), Lapiang Manggagawa (Philippine Labour and Peasant Party).

Executive Power
The President is both the Head of State and 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.


COVID-19 Country Response

Travel restrictions
Regularly updated travel information for all countries with regards to Covid-19 related entry regulations, flight bans, test and vaccines requirements is available on TravelDoc Infopage.
To find information about the current travel regulations, including health requirements, it is also advised to consult Travel Regulations Map provided and updated on a daily basis by IATA.
Import & export restrictions
A general overview of trade restrictions which were adopted by different countries during the COVID-19 pandemic is available on the International Trade Centre's COVID-19 Temporary Trade Measures webpage.
Economic recovery plan
For the general overview of the key economic policy responses to the COVID-19 pandemic (fiscal, monetary and macroeconomic) undertaken by the government of the Philippines, please consult the country's dedicated section in the IMF’s Policy Tracker platform.
Support plan for businesses
For an evaluation of impact of the Covid pandemic on SMEs and an inventory of country responses to foster SME resilience, refer to the OECD's SME Covid-19 Policy Responses document.
You can also consult the World Bank's Map of SME-Support Measures in Response to COVID-19.