Who minds the economy?

Ano ba talaga, Kuya?*

Economy Secretary Arsenio M. Balisacan sadly shook his head and said the economy is not doing well. “In 2025, the economy expanded by 4.4%, much weaker than the 5.7% growth in 2024. This was the weakest pace in five years or when GDP declined by 9.5% in 2020. Excluding the pandemic, it was the slowest growth since the 3.9% expansion in 2011. The full-year average also fell below the Development Budget Coordination Committee’s (DBCC) 5.5%-6.5% goal” (bworldonline.com, Jan. 30).

“It’s not a disaster,” Finance Secretary Frederick Go said in a speech at a recent life insurers association event (business.inquirer.net, Jan. 31). “The global average of GDP growth… is only 2.9%. The ASEAN average is 3.8%. We’re growing at 4.4%, so it’s not the end of the world.”

Still, the 4.4% GDP growth is the slowest pace since 2011, excluding the peak pandemic years — and marked the third consecutive year that the Marcos administration has fallen short of its growth target.

The weak growth had largely been expected, resulting from the flood control corruption scandal that froze government spending.

“We’ve met with the Department of Budget and Management, and we’ve met with the top spenders among the agencies. The DoF (Department of Finance) has cleared the amount of money that we’re making available to the government for its expenditures.” The top five spending agencies, according to Go, are the Departments of Public Works and Highways, Education, Health, Agriculture, and Transportation (Ibid.)

The Marcos administration is now targeting economic growth of 5-6% in 2026, 5.5-6.5% in 2027, and 6-7% in 2028. (All of these goals had been revised downward.) Go is banking on controlled inflation, as well as growth in remittances and exports, as key drivers of economic expansion this year.

Private sector analysts also expect the Philippine economy to fall short of its 6% growth potential this year, with any meaningful rebound hinging on the government’s ability to restore confidence after that sweeping corruption scandal rattled businesses and consumers.

Except this: “What we have learned from experience is that in episodes of an anti-corruption drive, good or bad, it doesn’t last long,” Alvin Arogo, first vice-president and chief economist at the Philippine National Bank said. “The growth drag from anti-corruption efforts tends to be temporary, as public sentiment eventually shifts back toward prioritizing economic expansion” (Ibid.). Forgive and forget?

In April 2023, Rajiv Biswas, Asia-Pacific Chief Economist, S&P Global Market Intelligence, was raving about the Philippine economy. “The Philippines economy grew at a pace of 7.6% in 2022, the fastest rate of economic growth recorded by the Philippines since 1976. With strong growth forecast over the medium-term outlook, the size of Philippines GDP measured in US Dollar nominal terms is set to reach USD one trillion by 2033.

“This will make the Philippines one of the largest emerging markets in the Asia-Pacific as well as a leading emerging market globally. Average annual GDP per person has also risen dramatically over the past two decades, from below $1,000 per person in 2000 to $3,500 by 2022 and is projected to rise above $6,000 per person by 2030” (spglobal.com, April 24, 2023).

Indeed, World Bank open data presented good GDP scores for the Philippines for the five years since COVID: -9.5% in 2020; 5.7% in 2021; 7.6% in 2022; 5.5% in 2023; and 5.7% in 2024. In its bi-annual Global Economic Prospects report, the World Bank said the Philippine gross domestic product (GDP) is expected to expand by 5.3% in 2026 and 5.4% in 2027 (bworldonline.com, Jan. 15). Projections are still unchanged as of now.

Note that in January 2025, the Department of Finance was happy that “the Philippine economy has maintained a steady gross domestic product (GDP) growth of 5.6% in 2024 — the second fastest in ASEAN — despite multiple challenges. The outlook for 2025 also remains bullish, fueled by lower inflation and higher consumption and investments… the Philippines currently ranks as the 8^th fastest-growing economy last year 2024 compared to the 46 countries that have released their fourth-quarter GDP data (dof.gov.ph, Jan. 30).

“The P6.326-trillion national budget for 2025 is the government’s most powerful tool to counter risks and deliver the biggest growth and economic benefits to Filipinos. President Ferdinand R. Marcos, Jr. continues to lead meetings to identify gaps in the appropriations of National Government agencies, ensuring that funds are used effectively for maximum impact,” the DoF boasted then. In January 2025, no budget shenanigans had been revealed yet, no flood control scams unearthed yet!

President Ferdinand R. Marcos, Jr. on Jan. 5, signed the P6.793-trillion national budget for Fiscal Year 2026, sustaining the momentum in education reform, health protection, food security, social security, and job creation, the Presidential Communications Office (PCO) announced. During the signing ceremony at Malacañang Palace, Mr. Marcos assured the public that the 2026 GAA, or Republic Act No. 12314, was appropriately aligned with the government’s medium- and long-term development plans and is focused on uplifting the lives of Filipinos. Controversial “unprogrammed appropriations” are reportedly still tucked in the 2026 budget, as these were in the P6.793-trillion national budget for 2025. The unprogrammed appropriations are being linked to the corruption connected to flood control projects revealed in the second half of 2025. Acting Budget Secretary Rolando Toledo said he is opposed to scrapping unprogrammed appropriations from the 2027 national budget, which the agency has already begun preparing.

But it is wrong to hold back on government spending, according to Solita Monsod, who was the Minister of Economic Planning, and later Secretary of Socio-economic Planning and concurrent Director of the National Economic and Development Authority (NEDA) from 1986 to 1989, during the term of President Corazon Aquino. In a podcast on Feb. 2 on YouTube, Ms. Monsod explained: “Why did public construction funding go down? It was not because of the investigation. It was because the Department of Public Works [and Highways or DPWH] and [other agencies] with infrastructure programs in the government became scared to sign vouchers because they may also be implicated. They were like in suspended animation. But that is something that the government could have prevented.

“It’s not the scandal that caused the freeze in public construction funding. It was the government who froze public construction. That may not show corruption, but that certainly shows inefficiency,” she said, criticizing Mr. Balisacan’s pronouncement that the slowdown in public infrastructure spending was necessary to restore the public’s trust in the government.

The slow-down failed to restore the trust of Filipinos in the executive branch, including the DPWH, as well as the House of Representatives and Senate, whose members allegedly benefited from kickbacks from the flood control projects. Ms. Monsod said the investigation has also failed to put the “big fishes” in the corruption saga behind bars, with only one high-ranking official — former Senator Ramon “Bong” Revilla, Jr. — and several officials of the DPWH incarcerated months after Mr. Marcos’ order to jail all personalities implicated in the flood control mess (inquirer.net, Feb. 2).

Ms. Monsod laments that the real tragedy is not corruption, but confusion. Citizens, left in the dark, are easy to manipulate. “Without a basic understanding of economics, para tayong dumadaan sa buhay na may isang kamay na nakatali sa likod (it is like we are going through life with one hand tied behind our back)” she said. “Economics, sa pinakaugat nito, ay tungkol sa decision-making, pagpili (At its root, economics is about decision-making and choice). And if we don’t know how to make informed choices, life becomes much harder than it needs to be, and there’s a greater chance of failure.”

We, the people, have to know, and to understand the technicalities of socioeconomics and its impacts.

The problem is, “What are they telling us? And more importantly, what are they not telling us?” Ms. Monsod asks. According to DepDev, the Philippine economy closed 2025 with growth of 4.4%, missing the government’s growth target for the third straight year. Ms. Monsod pointed out that in 2025, GDP growth projections were revised by government thrice before yearend: from 6.5% to 8%; from 6% to 7%; and then in December 2025, from 5.5% to 6.5%. And then we ended with 4.4%?

“In the last 50 years, I have seen the same problems occur again and again: krisis sa bigas, kakulangan sa (rice crisis, lack of) decent jobs, bureaucratic corruption, problema sa utang (debt problems), presidential corruption, legislative corruption. Iba lang ang pangalan ng mga nag–ko-cause sa problemang ito. Pero sa totoo lang, ngayon, pare-pareho rin ang mga pangalan, (The names of those causing the problems change. But in reality, now, all the names are the same)” she said in her podcast.

While faces change, systemic problems persist. Political dynasties offer solutions without evidence or data. “The result? Nalilito ang taong bayan (Filipinos are confused). And when people are confused, they are so easy to manipulate,” Ms. Monsod said. “These leaders, they’re not serving the people. They’re serving themselves.

“Citizens must question and engage,” she encourages. “I learned early on, it’s better to be a fool some of the time, than a fool all of the time.”

*What is it really, Brother?

Amelia H. C. Ylagan is a doctor of Business Administration from the University of the Philippines.

ahcylagan@yahoo.com