A WIDER trade-in-goods gap may keep the country’s Balance of Payments (BOP) in deficit in the next two years, according to the Bangko Sentral ng Pilipinas (BSP).
The BOP is projected to post a steeper decline of 1.4 percent of GDP to a deficit of $6.9 billion for 2025 and post -0.6 percent of GDP to a deficit of $3.4 billion in 2026.
With this, the current account shortfall is expected to stay at 3.3 percent of GDP in 2025 and 2.9 percent of GDP in 2026.
‘These reflect a widening trade-in-goods gap, subdued services receipts, and restrained capital inflows amid global uncertainty and shifting trade policies,’ BSP said.
BSP said goods exports and imports are both expected to post an average growth of 1 percent this year and next year.
Exports could average $55.6 billion in 2025 and $56.2 billion in 2026, while imports could reach $125.2 billion in 2025 and $126.4 billion in 2026.
‘Infrastructure investments, potential trade diversion, and efforts to diversify export and import partners may help cushion external shocks,’ BSP said.
‘However, structural constraints, such as logistical inefficiencies, skills mismatches, and elevated input costs, continue to weigh on export competitiveness,’ it added.
Services exports are projected to grow 2 percent in 2025 and 5 percent in 2026 while service imports are expected to increase 6 percent in 2025 and 2026.
The country’s services exports could reach $52.6 billion in 2025 and $55.2 billion in 2026. Service imports are projected to average $39.9 billion in 2025 and $42.3 billion in 2026.
BSP said the country’s service exports and imports, particularly from Business Process Outsourcing firms and tourism, could moderate due to ‘uncertainties surrounding US reshoring policies and weakening inbound travel.’
In terms of cash remittances, BSP said these inflows may average 3 percent to $35.5 billion this year and $36.6 billion next year.
‘Overseas Filipino remittances are expected to remain a resilient source of external support, underpinned by strong global labor demand and sustained confidence in formal transfer channels, despite the impending US tax on remittances,’ the BSP said.
Meanwhile, BSP said foreign direct investment inflows are projected to slow this year to $7.5 billion and $8 billion next year.
The data also showed foreign portfolio investments are expected to average $6.2 billion in 2025 and $5 billion in 2026.
‘[This reflects the] heightened global financial volatility and
cautious investor behavior. However, recent policy reforms-including amendments to the Investors’ Lease Act-are poised to improve the investment climate,’ the BSP said.
With these, the country’s Gross International Reserves are expected to average $105 billion in 2025 and $106 billion in 2026.
BSP said this remains adequate and serve as a robust buffer against external liquidity needs even as global market conditions evolve.