PH economy expands 5.5% in Q2, among fastest in Asia

The Philippine economy grew by 5.5 percent in the second quarter of 2025, slightly faster than the previous quarter, cementing its place among the fastest-growing economies in emerging Asia, government officials reported on Thursday.

According to the Philippine Statistics Authority, the second-quarter gross domestic product (GDP) growth edged up from 5.4 percent in Q1. While it was slower compared to the 6.5 percent recorded in the same period last year, officials emphasized that the economy continues to show resilience amid global headwinds.

Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio Balisacan said the country’s performance keeps it ahead of key regional peers, including China and Indonesia.

“With this performance, we maintain our place among the fastest-growing economies in emerging Asia,” Balisacan said during a briefing in Quezon City. “We are ahead of China’s 5.2 percent and Indonesia’s 5.1 percent, and just behind Vietnam’s 8 percent.”

The agriculture sector posted a strong 7 percent rebound during the quarter, reversing last year’s contraction. Balisacan attributed the recovery to better palay and corn harvests and increased investments in irrigation and storage infrastructure under the Department of Agriculture’s support programs.

Meanwhile, the services sector remained robust, expanding by 6.9 percent with solid contributions from real estate and professional services. Industry growth, however, slowed to 2.1 percent due to weaker outputs in petrochemicals, electronics, and refined fuels.

On the demand side, household consumption—a major driver of the economy—accelerated to 5.5 percent, lifted by improving inflation, stable employment, and declining rice prices.

“Our strategic, sustained, and coordinated efforts to manage inflation and safeguard purchasing power are clearly making an impact,” Balisacan said, noting that Filipinos are regaining confidence in spending.

Government final consumption expenditures also rose by 8.7 percent, reflecting increased spending on education, health, and public services. However, public construction contracted by 8.2 percent due to frontloaded infrastructure work ahead of the election-related spending ban.

Trade also supported growth, with exports expanding by 4.4 percent and imports growing by 2.9 percent.

“The Philippine economy remains strong, steady, and resilient—a testament to the soundness of our economic foundations,” Balisacan said, though he emphasized that sustained growth must translate to tangible improvements in the lives of ordinary Filipinos.

He said the government is intensifying rollout of programs in human capital development, food security, and connectivity to support inclusive growth.

For the first half of 2025, the country’s average growth rate stood at 5.4 percent. Balisacan remains confident that the lower end of the government’s 5.5 to 6.5 percent full-year target will be met.

“Hitting the goal is not that difficult because we are just crossing the lower limit of the range,” he said, adding that a more stable global economic environment in the second half may support this projection.