President Marcos’ chief economic manager has expressed “full confidence” that the Philippine economy remains firmly on the path to recovery and progress despite growing below target.

Finance Secretary Benjamin E. Diokno said the country’s first three-quarter gross domestic product (GDP) growth this year of 5.5 percent was still “solid.”

Nevertheless, the growth figure for the nine-month period fell below the government's target range of 6.0 percent to 7.0 percent.

“With a brightening outlook on the horizon and a strong array of revenue-enhancing reforms, the Philippine economy remains firmly on the path to recovery and progress,” Diokno said on Wednesday, Nov. 22.

Diokno cited that the Philippines posted the strongest third-quarter growth of 5.9 percent in the region, faster than China, Indonesia, Vietnam, Malaysia, and Singapore.

The strong growth performance was supported by higher revenue collections, easing inflation, and continuous improvements in the jobs market, he said.

“Despite external risks and domestic challenges, the Philippines remains to be one of the brightest spots in the region,” Diokno said.

This is backed up by strong growth forecasts from foreign financial institutions, such as the World Bank (WB) which expects the Philippines to outpace its East Asia and Pacific peers at 5.6 percent in 2023.

The ASEAN+3 Macroeconomic Research Office (AMRO), on the other hand, projects the Philippines to post the highest growth in Southeast Asia both in 2023 and 2024 at 5.9 and 6.5 percent, respectively.

“With a promising outlook on the horizon, we are confident that we will achieve the lower end of our growth target of 6.0 to 7.0 percent for this year, and accelerate at 6.5 to 8.0 percent from 2024 to 2028,” said the Finance Chief.

The Marcos, Jr. administration aims to pursue macroeconomic stability and fiscal sustainability by implementing the Philippines’ first-ever Medium-Term Fiscal Framework (MTFF).

Among the key reforms being pursued by the Department of Finance (DOF), as identified under the MTFF to accelerate economic development, are the Real Property Valuation and Assessment Reform Bill, the Passive Income and Financial Intermediaries Taxation Bill, and the value-added tax (VAT) on digital services.

On top of these, the DOF is also pushing for the passage of tax measures on sweetened beverages and junk food, as well as an excise tax on single-use plastics (SUPs), motor vehicle road users tax, and the rationalization of the country’s mining fiscal regime.

“Together, these measures aim to improve tax administration, enhance the fairness and efficiency of our tax system, and promote environmental sustainability to address climate change,” Diokno said.