Despite sunny projections from the Marcos administration, the World Bank, and other financial institutions, the Philippine economy is on a continuing trajectory of slowdown unless its growth engines are fundamentally reformed, IBON Foundation said. Headline growth figures mask deep-seated structural weaknesses that have long plagued the economy and are now becoming more pronounced.
Gross domestic product (GDP) growth slowed to 4.0% in the third quarter, from an average 5.0% growth in the first three quarters of the year and 5.7% the year before. This is not a sudden downturn but part of a longer deceleration underway since 2017, only briefly obscured by the pandemic shock and rebound.
IBON said that the temporary drivers of rapid growth since the mid-2000s have faded and the economy is reverting to its historical average growth rate of around 5 percent. The weakening expansion of wage employment and slowing of overseas remittances constrains household spending, investments are fading amid domestic poverty and weaker global trade and foreign investment, and the possibilities for meaningful fiscal stimulus are closed by large deficits and debt.
On the ground, widespread economic distress—marked by unstable work, low incomes, and persistent poverty—has already driven the President’s performance ratings at the start of 2025 to the worst levels in post-dictatorship history.
IBON stressed that while corruption scandals may have aggravated the slowdown, they are not its root cause. The deeper problem is the persistence of neoliberal economic policies that fail to develop domestic agriculture and manufacturing, while enabling service- and utilities-driven profits for a narrow elite amid the plunder of public resources. Growth is propped up by foreign investments and overseas workers’ remittances instead of building productive capacity at home. At the same time, the government continues to shield billionaires and the richest families from taxation and shifts the burden onto ordinary Filipinos.
“The result is growth without transformation—growth that leaves most people poorer, more insecure, and excluded,” IBON said. “Without a decisive break from elite-biased policies, the economy will continue to slow and social distress will deepen.”
In this context, IBON said that the impeachment bid should be seen not merely as a political crisis but as a potential opening for long-delayed reforms. Political disruption reaching even the highest levels of government can help create the conditions to dismantle governance mainly concerned with retaining political power with pork, patronage, and impunity.
“More than fearing the disruption caused by holding top officials to account, the government should be alarmed by the long-standing distress of people from poverty, joblessness, and lack of basic services—while a few live in luxury and comfort,” IBON said. “More than courting investor confidence, it is the confidence of small producers, workers, and communities who actually build the economy that must be earned.” IBON added that political disruptions can strengthen, not weaken, the foundations of long-term development and impeachment efforts should be viewed as an opportunity to reset governance and begin forging people-centered leadership. Such a shift is necessary to enable the transformative economic and political reforms needed to move the country away from drift and toward genuine development that serves the many, not the few.
