The Marcos administration is confronting corruption head-on, according to Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio Balisacan, the government’s chief economist. 

Balisacan told Manila Bulletin on Monday, Sept. 22, that the government is seeking public support to eliminate corruption in infrastructure projects and across government.

Balisacan emphasized that this serves as a positive force in strengthening investor confidence and enhancing the economy's medium- to long-term prospects. 

“Corruption concerns by the business community and the broader public are not new,” Baliscan added. 

Earlier, during the 53rd anniversary of Martial Law, people joined protests against corruption, which were mainly held at Rizal Park in Manila and at the People Power Monument along EDSA in Quezon City.

The rallies drew students, church groups, professionals, and ordinary citizens calling for accountability and transparency across all levels of government.

The private sector economists stressed that the recent protests underscored the public’s demand for transparent governance and warned that the government’s response would be crucial in shaping investor confidence and market stability.

Robert Dan Roces, Group Economist of SM Investments Corp. (SMIC), told the Manila Bulletin that the protest highlighted the public’s demand for cleaner governance.

However, he noted that the government should be given the opportunity to demonstrate its resolve.

“If investigations are credible and reforms are real, the Philippines can strengthen its institutions, reassure investors, and even attract long-term capital,” he said.

Roces added that decisive action against corruption could turn unrest into a demonstration of accountability, potentially boosting investor confidence and supporting the country’s growth outlook.

Jonathan L. Ravelas, Senior Adviser at Reyes Tacandong & Co., also told Manila Bulletin that “Filipinos are fed up with corruption”.

“People from all walks of life, students, church groups, and professionals are demanding real transparency and accountability, not just lip service,” he added. 

Raveles emphasized that the investors are closely observing from the sidelines. 

“If the government acts fast and clean, it could actually boost confidence. But if it drags its feet, expect more market jitters,” he added.

Earlier, two global banking giants had already raised concerns about the Philippine economy due to political and fiscal challenges. This follows the corruption scandal involving large public expenditures on ineffective flood control projects.

In a Sept. 19 report, MUFG Global Markets Research senior currency analyst Michael Wan noted that while a “strong pipeline of infrastructure projects” exists, “recent developments on flood control projects’ corruption raise some risk.”

Wan also pointed to the scheduled protests on Sunday, tied to the anniversary of the declaration of martial law, as a key risk factor, as markets will be watching the size of these demonstrations for any potential impact on government policy and, ultimately, the Philippine peso.

The corruption allegations have already led to the resignation of House Speaker Martin Romualdez, a cousin of President Marcos, and have prompted the chief executive to pledge transparency and reform.

In a separate report on Sept. 18, Deutsche Bank Research economist Junjie Huang stated that “downside risks to the Philippine economy have not faded,” despite the Bangko Sentral ng Pilipinas (BSP) suggesting it has reached a policy rate “sweet spot.”

Huang believes the central bank may need to further ease its policy given that the real interest rate remains high, and that there are “fiscal constraints and subdued economic sentiment.”

The economist also noted the slower pace of fiscal consolidation under the Marcos Jr. administration, with the 2026 deficit target widened to 5.3 percent of gross domestic product, and cautioned that looming US semiconductor tariffs pose a threat to the Philippines’ electronics-heavy export sector.

Both banks project the Philippine economy to grow by 5.7 percent this year, matching the 2024 growth rate.

(Ricardo M. Austria)