PHILIPPINE EXPORTS may fall short of the government’s projections this year amid the ongoing war in the Middle East and uncertainty over the United States’ tariffPHILIPPINE EXPORTS may fall short of the government’s projections this year amid the ongoing war in the Middle East and uncertainty over the United States’ tariff

Middle East war, US tariffs cloud Philippine export growth outlook

2026/05/04 00:31
3 min read
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By Beatriz Marie D. Cruz, Senior Reporter

PHILIPPINE EXPORTS may fall short of the government’s projections this year amid the ongoing war in the Middle East and uncertainty over the United States’ tariff policies.

University of Asia & the Pacific School of Economics Senior Economist Victor A. Abola said that export target for this year “may be not possible given the global situation.”

Under the Philippine Export Development Plan, exports are projected to hit between $116.1 billion to $120.2 billion this year. This is below the initial target of $186.7 billion.

“I think we should be happy with double-digit growth given the global situation and also the Trump tariffs,” he told reporters last week. “But it depends also on what we would be exporting.”

However, the outlook for exports may be clouded by the Middle East conflict, which has pushed up global oil prices.

Mr. Abola said uncertainty surrounding the US tariff policy may affect Philippine exports. The US remains the Philippines’ biggest export market.

US President Donald J. Trump in February threatened to impose a 15% global tariff on imports, following a US Supreme Court ruling that he had exceeded his authority to levy higher duties under an economic emergency law.

The Philippines was initially hit with a 19% tariff on its exports to the US, although this has since been revoked due to the US Supreme Court’s decision.

To boost export growth, the Philippine government needs to boost investments and explore incentives to support industries like manufacturing, agriculture, and semiconductors, Mr. Abola said.

“What I think should be done is that the BoI (Board of Investments) should give incentives to agriculture, so that big firms can consolidate… [where] they can support the farmers and buy in bulk,” he noted.

Meanwhile, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the Philippines’ entry in the global Pax Silica initiative would help boost its export growth.

“The Pax Silica initiative provides great promise in enticing more foreign direct investments, employment, exports, and other business/economic opportunities for the country in terms of AI-related electronics, rare earths, and other high-tech products,” he said in a Viber message.

The Philippines in April formally joined the Pax Silica, a US-led initiative aimed securing the global AI supply chain across critical minerals, advanced manufacturing, and AI infrastructure.

Current signatories to the Pax Silica initiative include US, Australia, Greece, India, Israel, Japan, Qatar, Republic of Korea, Singapore, United Arab Emirates, and the United Kingdom, while Taiwan is a non-signatory participant.

“[The Pax Silica would] help attract more suppliers and other high-tech or AI-related companies to locate in the Philippines and effectively do technology transfer,” Mr. Ricafort said.

John Paolo R. Rivera, senior research fellow at the Philippine Institute for Development Studies, said the government’s export growth target remains “attainable” but challenging amid global uncertainties.

“The target remains attainable but on the lower end of the range, supported by resilient demand in key markets, a weaker peso that improves competitiveness, and gradual recovery in services-related exports,” he said in a Viber message.

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