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Philippines Economy Profile 2018

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Economy - overviewThe economy has been relatively resilient to global economic shocks due to less exposure to troubled international securities, lower dependence on exports, relatively resilient domestic consumption, large remittances from about 10 million overseas Filipino workers and migrants, and a rapidly expanding outsourcing industry. During 2017, the current account balance fell into the negative range, the first time since the 2008 global financial crisis. However, international reserves remain at comfortable levels and the banking system is stable.

Efforts to improve tax administration and expenditures management have helped ease the Philippines' debt burden and tight fiscal situation. The Philippines received investment-grade credit ratings on its sovereign debt under the former AQUINO administration and has had little difficulty financing its budget deficits. However, weak absorptive capacity and implementation bottlenecks have prevented the government from maximizing its expenditure plans. Although it has improved, the low tax-to-GDP ratio remains a constraint to supporting increasingly higher spending levels and sustaining high and inclusive growth over the longer term.

Economic growth has accelerated, averaging over 6% per year from 2011 to 2017, compared with 4.5% under the MACAPAGAL-ARROYO government; and competitiveness rankings have improved. Although 2016 saw a record year for net foreign direct investment inflows, FDI to the Philippines has continued to lag regional peers, in part because the Philippine constitution and other laws restrict foreign ownership in important activities/sectors - such as land ownership and public utilities.

Although the economy grew at a faster pace under the AQUINO government, challenges to achieving more inclusive growth remain. Wealth is concentrated in the hands of the rich. The unemployment rate declined from 7.3% to 5.5% between 2010 and 2016 but the jobs are low paying and tedious. Underemployment hovers at around 18% to 19% of the employed. At least 40% of the employed work in the informal sector. Poverty afflicts more than a fifth of the population. More than 60% of the poor reside in rural areas, where the incidence of poverty (about 30%) is more severe - a challenge to raising rural farm and non-farm incomes. Continued efforts are needed to improve governance, the judicial system, the regulatory environment, the infrastructure, and the overall ease of doing business.

2016 saw the election of President Rodrigo DUTERTE, who has pledged to make inclusive growth and poverty reduction his top priority. DUTERTE believes that illegal drug use, crime and corruption are key barriers to economic development among the lower income class. This administration wants to reduce the poverty rate to 14% and graduate the economy to upper-middle income status by the end of President DUTERTE’s term in 2022. Key themes under the government’s Ten-Point Socioeconomic Agenda include continuity of macroeconomic policy, tax reform, higher investments in infrastructure and human capital development, and improving competitiveness and the overall ease of doing business. The administration has vowed to address spending bottlenecks and is pushing for congressional passage of a Comprehensive Tax Reform Program to help finance more aggressive infrastructure and social spending, starting in 2018. The government also supports relaxing restrictions on foreign ownership, except for land.
GDP (purchasing power parity)$874.5 billion (2017 est.)
$820.4 billion (2016 est.)
$767.2 billion (2015 est.)
note: data are in 2017 dollars
GDP (official exchange rate)$321.2 billion (2016 est.)
GDP - real growth rate6.6% (2017 est.)
6.9% (2016 est.)
6.1% (2015 est.)
GDP - per capita (PPP)$8,200 (2017 est.)
$7,900 (2016 est.)
$7,500 (2015 est.)
note: data are in 2017 dollars
Gross national saving25.8% of GDP (2017 est.)
24.5% of GDP (2016 est.)
23.7% of GDP (2015 est.)
GDP - composition, by end usehousehold consumption: 72.7%
government consumption: 10.9%
investment in fixed capital: 25.2%
investment in inventories: -0.2%
exports of goods and services: 32.1%
imports of goods and services: -40.7% (2017 est.)
GDP - composition by sectoragriculture: 9.4%
industry: 30.8%
services: 59.8% (2017 est.)
Population below poverty line21.6% (2015 est.)
Labor force44.46 million (2017 est.)
Labor force - by occupationagriculture: 26.9%
industry: 17.5%
services: 55.6% (2016 est.)
Unemployment rate6% (2017 est.)
5.5% (2016 est.)
Unemployment, youth ages 15-24total: 15%
male: 14.3%
female: 16% (2015 est.)
Household income or consumption by percentage sharelowest 10%: 3.2%
highest 10%: 29.5% (2015 est.)
Distribution of family income - Gini index44.4 (2015 est.)
46 (2012 est.)
Budgetrevenues: $44.74 billion
expenditures: $53.55 billion (2017 est.)
Taxes and other revenues13.9% of GDP (2017 est.)
Budget surplus (+) or deficit (-)-2.7% of GDP (2017 est.)
Public debt41.9% of GDP (2017 est.)
42.1% of GDP (2016 est.)
Inflation rate (consumer prices)3.1% (2017 est.)
1.8% (2016 est.)
Central bank discount rate3.56% (31 December 2016)
6.19% (31 December 2015)
Commercial bank prime lending rate6% (31 December 2017 est.)
5.64% (31 December 2016 est.)
Stock of narrow money$68.16 billion (31 December 2017 est.)
$61.62 billion (31 December 2016 est.)
Stock of broad money$199 billion (31 December 2017 est.)
$183.5 billion (31 December 2016 est.)
Stock of domestic credit$207.4 billion (31 December 2017 est.)
$184.6 billion (31 December 2016 est.)
Market value of publicly traded shares$290.4 billion (31 December 2016 est.)
$286.1 billion (31 December 2015 est.)
$318 billion (31 December 2014 est.)
Agriculture - productsrice, fish, livestock, poultry, bananas, coconut/copra, corn, sugarcane, mangoes, pineapple, cassava
Industriessemiconductors and electronics assembly, food and beverage manufacturing, construction, electric/gas/water supply, chemical products, radio/television/communications equipment and apparatus, petroleum and fuel, textile and garments, non-metallic minerals, basic metal industries, transport equipment
Industrial production growth rate6.5% (2017 est.)
Current Account Balance-$315 million (2017 est.)
$601 million (2016 est.)
Exports$53.22 billion (2017 est.)
$43.44 billion (2016 est.)
Exports - commoditiessemiconductors and electronic products, machinery and transport equipment, wood manufactures, chemicals, processed food and beverages, garments, coconut oil, copper concentrates, seafood, bananas/fruits
Exports - partnersJapan 20.8%, US 15.5%, Hong Kong 11.7%, China 11%, Singapore 6.6%, Germany 4.1% (2016)
Imports$90.42 billion (2017 est.)
$77.52 billion (2016 est.)
Imports - commoditieselectronic products, mineral fuels, machinery and transport equipment, iron and steel, textile fabrics, grains, chemicals, plastic
Imports - partnersChina 17.3%, Japan 11.1%, US 8.4%, Thailand 7.3%, South Korea 6.1%, Singapore 6.1%, Indonesia 5.1% (2016)
Reserves of foreign exchange and gold$81.53 billion (31 December 2017 est.)
$80.69 billion (31 December 2016 est.)
Debt - external$80.88 billion (31 December 2017 est.)
$75.01 billion (31 December 2016 est.)
Stock of direct foreign investment - at home$67.25 billion (31 December 2017 est.)
$64.25 billion (31 December 2016 est.)
Stock of direct foreign investment - abroad$47.58 billion (31 December 2017 est.)
$45.38 billion (31 December 2016 est.)
Exchange ratesPhilippine pesos (PHP) per US dollar -
50.21 (2017 est.)
47.493 (2016 est.)
47.493 (2015 est.)
45.503 (2014 est.)
44.395 (2013 est.)
Fiscal yearcalendar year

Source: CIA World Factbook
This page was last updated on January 20, 2018