Category: Business Mirror

The global economy is going through a massive structural reorganization driven by artificial intelligence, and the Philippines stands at a decisive crossroads. The choice is wholly our own. We can either remain a passive consumer on the sidelines or step directly into the high-value manufacturing core with the opportunities in front of us.

Since the ’70s, the Philippine economic growth story has been built on a familiar blueprint: consumption, remittances, and the service sector. We excelled at consuming high-tech products and delivering tech-enabled services, but when it came to the critical physical hardware of the global economy, our role remained largely peripheral. We exported raw minerals like unrefined nickel and copper, only to buy them back as marked-up microchips and high-end hardware.

Our non-binding sign-on to the Pax Silica Declaration in April 2026, joining a 30-partner network including the US, Japan, South Korea, and Singapore, is our most viable launchpad towards hopefully becoming a real player in the global technology value chain.

Unlocking the multiplier effect

The real economic prize of Pax Silica lies in the physical development mapped out for New Clark City. The designation of a dedicated 1,620-hectare Industrial and Innovation Ecosystem within the Luzon Economic Corridor sets a concrete target for high-value manufacturing.

The vision of Pax Silica in New Clark City is to build an integrated innovation district where research institutions, advanced manufacturers, technology firms, logistics providers, universities, housing, commercial centers, and green public spaces operate as a single ecosystem.

The economic potential is significant. The Philippine government, through the Bases Conversion and Development Authority (BCDA), estimates an initial investment target of US$10 billion, which could scale to US$40 billion to US$70 billion once the development is fully built out. The agency estimates that the project could generate 130,000 to 190,000 direct jobs, alongside another 500,000 to 800,000 indirect and induced jobs across the wider economy. BCDA also estimates up to US$200 billion in export potential and P68 billion to P75 billion in annual withholding-tax potential at full development.

But from where I am standing, the bigger opportunity is what these numbers could mean for Filipino talent. Because the project carries much potential for brain gain, that is, creating opportunities for engineers, researchers, computer science graduates and other highly skilled Filipinos to build careers at home rather than having to leave the country for the industries they helped power abroad.

Beyond the direct site in New Clark City in Capas, Tarlac, the capital expenditure needed for this industrial push will create an immediate ripple effect across our domestic financial system. Foreign direct investment at this scale requires a vast ecosystem of local joint ventures, corporate financing, structural loans, and commercial credit lines. Construction firms, local component suppliers, and service providers will see sustained balance-sheet growth, while domestic banks stand ready to fund the extensive supply chains feeding into this hub.

Where does the Luzon Economic Corridor come in? High-tech manufacturers do not exist in isolation. When top-tier semiconductor packaging, AI component, and EV hardware firms establish a base, their global suppliers, and even their direct market competitors, naturally cluster around them.

This ecosystem effect will turn Central and Northern Luzon into an economic powerhouse. The movement of raw materials and finished tech components along the logistics line will spur commercial real estate and service hubs from Clark down to Subic and Manila. It turns logistics routes into high-value economic corridors.

However, international capital moves where friction is lowest. Investors look at real capabilities and not just pledges. To capture this momentum, our domestic policy agenda must match the ambition of Pax Silica. Pax Silica-related investments would also consider certainty and continuity of investment-related policies in view of the next Philippine presidential elections in May 2028. And that’s precisely Manila’s role in delivering on prerequisites for growth.

Capitalizing on Pax Silica requires us to execute structural reforms with discipline. We must rapidly align our education sector with market demands. Expanding technical-vocational tracks and specialized university STEM curricula directly tied to semiconductor packaging, material science, and AI hardware architecture is non-negotiable. High-tech manufacturing demands uninterrupted power and reliable utilities.

The BCDA has said that it is also planning dedicated infrastructure to support the hub’s resource requirements, including a proposed 500-MW solar facility and a surface-water harvesting system designed to provide up to 120 million liters of water per day. BCDA has said these measures are intended to support the project’s industrial requirements without relying on community water supplies or placing additional pressure on the existing power system.

Lastly, investor sentiment relies heavily on stability and institutional governance. As far as the ease of doing business, we must continue reducing administrative red tape under the Anti-Red Tape Authority, modernizing foreign ownership frameworks, and ensuring a predictable, transparent regulatory environment.

Moving beyond the raw mineral trap

History shows that transformative industries rarely grow in isolation. Silicon Valley, Hsinchu Science Park in Taiwan, and One-North in Singapore became engines of national growth because they concentrated talent, capital, research, and enterprise in one place. Pax Silica in New Clark City aims to create the conditions for a similar ecosystem to emerge in the Philippines.

For too long, the Philippines has occupied its humble spot in the lower rungs of the resource ladder, mining raw nickel and copper, shipping them out, and ultimately losing out on the most profitable stages of production. But Pax Silica gives us the bridge to process those raw minerals locally into high-value components for AI systems, energy storage, and semiconductor assemblies.

By integrating public land assets held by the Bases Conversion and Development Authority under secure long-term leases rather than land sales, the state maintains sovereign ownership while providing world-class infrastructure to international locators.

Beyond just an industrial expansion, the integration of Pax Silica into the Luzon Economic Corridor is an overdue structural upgrade for our national economy. By securing our position within global tech supply chains, we build a more resilient, high-income industrial base for the future. The opportunity is on our table; our task now is to build for it.

Michael Ricafort is the Chief Economist of Rizal Commercial Banking Corporation

THE Department of Tourism (DOT) recognized the Philippines’s local tribal cultures and their contributions to the world, as it joined the global celebration of the International Day of the World’s Indigenous Peoples on August 9.

In a news statement, Acting Tourism Secretary Ma. Bernadita Angara-Mathay said these local indigenous communities’ vibrant identities ‘are woven into the tapestry of the country’s tourism.’

She enjoined the public to ‘celebrate their invaluable contributions and continue building a tourism industry where every culture is respected, every story is valued, and where there is always more to discover and love in the Philippines.’

Angara-Mathay also paid homage to Filipino indigenous communities, whose textile designs and weaves were introduced by popular Japanese clothing store Uniqlo through its Re.Uniqlo Artisan Patch project. The initiative, under the guidance of Uniqlo Philippines’s Art Director Wilson Limon, transforms scraps of fabrics into clothing patches woven with traditional Filipino designs.

According to the DOT, the project was developed after Angara-Mathay encouraged the Japanese company to showcase Filipino craftmanship by collaborating with local indigenous weavers and textile communities.

Recycling fabric scraps

‘About a year ago, while serving as the Philippines’s Commercial Counselor in Japan, I approached four of Japan’s leading retailers with a proposal…. I invited them to work with us on co-creation projects inspired by Philippine icons, our natural resources, our creatives, and our shared commitment to innovation,’ she said during the recent celebrations of the 70th anniversary of the Philippines and Japan’s diplomatic ties, and Uniqlo’s 14th year in the Philippines.

The DOT said these textile patches were hand-embroidered by indigenous communities from Abra, Iloilo, and South Cotabato on Uniqlo fabric scraps, ensuring that each piece is unique, distinct, and meaningful to each culture.

The limited-edition patches are available at select Uniqlo stores in the country for P300 each, inclusive of service fee. The patches may be sewn instore only on Uniqlo clothes, even if these are not newly purchased pieces. The patches are available until the end of August.

On its website, Uniqlo said that all proceeds from this initiative, implemented in partnership with the ABS-CBN Foundation, ‘will help sustain the Schools of Living Traditions of the Itneg [Abra], Panay Bukidnon [Iloilo], and T’Boli [South Cotobato], supporting the preservation of Filipino traditional arts, crafts, and cultural heritage.’

The DOT chief expressed her appreciation to Uniqlo for supporting initiatives that promote Filipino traditions, creativity, and education while strengthening the longstanding friendship between the Philippines and Japan.

Preserving heritage, culture

‘I would like to congratulate Uniqlo for showing that retail can help preserve culture and heritage. Around the world, you have demonstrated that innovation and heritage can thrive together,’ said Angara-Mathay.

Uniqlo also partnered with Salcedo Auctions on creating three art installations celebrating the long friendship between the Philippines and Japan, again another initiative by the DOT chief’s time in Japan. Angara-Mathay had introduced Richie and Karen Lerma, owners of Salcedo Auctions, to the clothing company.

The installations feature the distinct landscapes and iconic landmarks of Luzon, Visayas, and Mindanao with traditional Japanese symbols.The installations also highlight sustainability and local craftsmanship.

The DOT added that each installation is constructed from Japanese poplar wood sourced from responsibly managed forests, and thus certified by the Forest Stewardship Council. The artwork also incorporate handcrafted origami elements created by artisans from Nueva Ecija, blending Japanese artistry with Filipino craftsmanship.

Uniqlo Philippines is co-owned by Japan’s Fast Retailing Co. Ltd. and SM Retail Inc. under a joint venture called Fast Retailing Philippines Inc. It opened its first store in Manila in 2012 and currently operates 81 stores in the country.

The government has reallowed the importation of canned pork products, but exporters must comply with a number of conditions prior to shipment of the food items to the Philippines.

Agriculture Secretary Francisco Tiu Laurel Jr. signed Department Circular (DC) 42, which lifted the temporary ban slapped on the importation of industrially manufactured, hermetically sealed, and heat-treated canned pork products.

The Department of Agriculture (DA) said its decision followed an import risk analysis (IRA) conducted last January, which showed that biosecurity risks are reduced to a negligible level when trade is strictly limited to industrially manufactured, hermetically sealed pork products.

However, the products employ heat levels that ‘aggressively exceed’ the World Organisation for Animal Health (WOAH) baseline requirement of 70 degrees Celsius for 30 minutes.

This stemmed from an article in WOAH’s Terrestrial Animal Health Code (TAHC), which outlines a procedure for the inactivation of African swine fever (ASF) virus in meat.

‘Heat treatment for at least 30 minutes at a minimum temperature of 70° C, which should be reached throughout the meat; or any equivalent heat treatment which has been demonstrated to inactivate ASFV in meat.’

Furthermore, the agency said WOAH’s principle of Safe Commodities states that specific industrial treatments, specifically hermetic sealing and thermal sterilization, effectively neutralize ASF virus.

Under DC 42, the entry of canned pork products into the Philippines is allowed, provided that the pork products have undergone heat treatment in a hermetically sealed container with an F0 value of 3.0 equivalent or greater; are industrially manufactured; and hold valid registration in the Philippines.

‘All import transactions for the aforementioned commodities must strictly

comply with the existing rules and regulations of the Department of Agriculture.’

The government issues temporary import restrictions as part of efforts to safeguard animal health and protect the local swine industry, which continues to grapple with the lingering effects of ASF since its detection in 2019.

Last February, Agriculture Undersecretary Constante Palabrica expressed optimism that hog production will recover this year, owing to government interventions that curbed the spread of ASF.

Government data showed that the country’s swine inventory stood at 8.79 million heads in 2025, a slight increase from the 8.75 million heads recorded in 2024.

‘The rebound is possible this year because we’ve minimized the transmission of the disease through the deployment of various checkpoints,’ Palabrica told reporters on the sidelines of the International Farmers Summit 2026.

In 2024, the DA deployed several livestock checkpoints across Luzon to curb the spread of ASF following the disease outbreak in Batangas. The agency said the outbreak may have been exacerbated by ‘unscrupulous hog traders selling diseased pigs.’

The House of Representatives has approved a measure seeking to strengthen and expand the country’s agricultural insurance system to provide Filipino farmers and fisherfolk with greater protection against typhoons, floods, droughts, diseases, and other threats to their livelihoods.

House Speaker Faustino G. Dy III, one of the authors of House Bill (HB) 10365, underscored on Sunday the importance of the measure, noting that a single calamity can wipe out not only a farmer’s harvest but also months of investment and the resources needed to resume production.

‘When a farmer is hit by a typhoon or flood, it is not only the crops that are lost. Their capital, their family’s income, and their ability to plant again are also put at risk,’ Dy said.

‘We need an insurance system that helps our farmers get back on their feet instead of forcing them deeper into debt. This measure will ensure that the people who feed our nation have something to fall back on when disaster strikes.’

HB 10365, which was approved on third and final reading last Wednesday with 201 affirmative votes, no negative votes, and no abstentions, seeks to strengthen the Philippine Crop Insurance Corp. (PCIC) by expanding its services and the agricultural activities eligible for insurance coverage.

‘Agriculture has changed significantly, along with the risks faced by our farmers and fisherfolk. Our agricultural insurance system must keep pace with those realities,’ said Dy, who served three terms as governor of Isabela, one of the country’s major food-producing provinces.

‘For a farmer, one typhoon can mean losing the crop, the money spent on seeds and fertilizer, months of labor, and the income the family was counting on. Without adequate protection, one disaster can become years of debt.’

Under the bill, PCIC insurance coverage would extend beyond traditional palay and corn crops to include high-value crops, livestock, aquaculture and fishery products, agroforestry crops, and forest plantations.

Coverage may also include agricultural machinery, equipment, transport facilities, and related infrastructure, as well as life and accident term insurance for farmers and fisherfolk.

The measure further provides that agricultural insurance should, as far as practicable, cover production inputs, the market value of labor provided by farmers or fisherfolk, their household members and hired workers, as well as a portion of the expected yield.

The PCIC would also be authorized to offer parametric or index-based insurance and other innovative insurance products.

HB 10365 would allow the PCIC to enter into public-private partnerships, joint ventures, and similar arrangements with agricultural cooperatives, farmers’ associations, and other private-sector participants.

It also retains government premium subsidies for qualified subsistence farmers cultivating no more than three hectares, subject to periodic review, while requiring that any premium share they pay remain reasonably affordable.

Dy said the expanded insurance protection would help farmers and fisherfolk recover more quickly and return to production, strengthening both family livelihoods and the country’s food security.

The Speaker said insurance is not merely compensation for losses.

‘Insurance is not simply compensation after a loss. It can mean having the resources to plant again, repair equipment, restore a livelihood, and continue producing food for our communities,’ he said.

‘When our farmers and fisherfolk are protected, they can recover more quickly. And when they recover more quickly, our country’s food production also becomes more resilient.’

The Department of Information and Communications Technology (DICT) will adopt the Scam Watch Pilipinas Anti-Scam Quad Model as the country’s national anti-scam education and awareness strategy, providing a unified framework for scam prevention at no cost to the government.

DICT Secretary Henry Aguda said the agency saw no need to build a new program from scratch when a working framework-anchored on public education and private sector collaboration-already exists.

‘Why reinvent the wheel? Let’s adopt it. If the program works, why shouldn’t we use it? It comes at no cost to the government, it benefits the public, and it is built on public-private partnership,’ Aguda said.

The adoption shifts the government’s anti-scam education approach from reactive alerts about emerging scams toward building long-term protective behavior among Filipinos, while positioning the Philippines as a regional leader in anti-scam awareness.

‘With the Anti-Scam Quad Model as our national education and awareness strategy, we can put the Philippines at the forefront of anti-scam education and awareness in Southeast Asia. We want Filipinos to be not only informed about scams but equipped with the right behavior and tools to prevent them,’ Aguda said.

The Quad Model rests on four components: behavioral change through the ‘Kontra-Scam Attitude,’ a volunteer watcher program, cross-sector collaboration, and technology-enabled reporting.

At its core is the Kontra-Scam Attitude, which promotes four behaviors when dealing with suspicious messages, calls, and online offers: Magdamot, Magduda, Mang-isnab, and Magsumbong sa 1326-the government’s dedicated scam-reporting hotline.

The second component mobilizes and trains volunteer anti-scam advocates to bring awareness directly to communities, schools, workplaces, and vulnerable sectors.

The third pushes for tighter coordination among government agencies, law enforcement, financial institutions, telecommunications companies, technology platforms, and civil society groups.

The fourth promotes digital reporting channels to make it easier for the public to flag suspicious activities and scam incidents.

Scam Watch Pilipinas co-founder Jocel de Guzman said the DICT’s commitment could move anti-scam education beyond simply warning the public whenever a new scheme surfaces.

‘Scam prevention should not stop at telling people what the latest scam is. We need to build the right behavior so Filipinos instinctively know what to do when confronted by suspicious messages, calls or offers,’ De Guzman said.

He said a common national framework would allow government agencies, communities, and private organizations to sustain prevention efforts rather than mount piecemeal campaigns.

A LEADER of the House of Representatives on Sunday assured that the impeachment trial of Vice President Sara Z. Duterte will not disrupt Congress’ review of the proposed P7.2-trillion national budget for 2027, while maintaining that actions she took as Education secretary remain subject to impeachment scrutiny because she was still the country’s Vice President.

As the House of Representatives begins deliberations on the 2027 National Expenditure Program (NEP), Rep. Bienvenido Abante Jr. of Manila said the schedule of the Senate Impeachment Court allows lawmakers to continue performing their legislative duties, including reviewing the government’s spending priorities for next year.

‘The Impeachment Court only runs for four hours. It starts in the morning, and by three o’clock, deliberations begin, so I don’t think it will be affected,’ Abante, vice chairman of the Committee on Good Government, said.

The Senate, sitting as an Impeachment Court, is currently hearing the four Articles of Impeachment filed against Duterte by the House of Representatives. The proceedings have covered allegations involving threats against President Ferdinand R. Marcos Jr., First Lady Liza Araneta-Marcos, and former Speaker Ferdinand Martin G. Romualdez, as well as the alleged misuse of P612.5 million in confidential funds from the Office of the Vice President (OVP) and the Department of Education (DepEd).

Abante, an endorser of the impeachment complaint against Duterte, said the proceedings should continue alongside Congress’ other responsibilities, including the examination and approval of the proposed national budget.

He expressed confidence that the impeachment trial and the budget deliberations can proceed simultaneously, adding that lawmakers must remain focused on their constitutional duties.

THE Philippines can expand local production of electric vehicle (EV) parts as the government rolls out its strategy to attract more investment into the sector, the Department of Science and Technology (DOST) said.

Science Secretary Renato Solidum Jr. told the BusinessMirror that the country could build domestic capabilities in several parts of the EV supply chain even as manufacturers remain dependent on imports for components that are not yet produced locally.

‘There are certain parts that are still abroad. We can’t do anything about it; that’s how the global supply chain is,’ Solidum said in an exclusive interview on the sidelines of the opening of the DOST Regional Science, Technology and Innovation Week in Region 9 last week.

‘But there are many parts that can be locally sourced,’ he added.

He cited vehicle chassis and body components as areas where local manufacturers could potentially expand, including through the use of composite materials made from Philippine tropical fibers.

‘For example, we can design chassis. We can do it here…the shell of vehicles. We can use composite materials using tropical fabrics. So there are a lot of things we can do,’ Solidum said.

The Board of Investments (BOI), for its part, has identified several automotive components that can be manufactured locally, including chassis and sub-frames, body panels, bumpers, instrument panels, electrical systems, automotive glass and seats.

The country is also seeking to develop its battery manufacturing capability. In September 2024, Australian firm StB GIGA Factory inaugurated a lithium-iron-phosphate battery manufacturing facility in New Clark City, with a planned production capacity of up to 2 gigawatt-hours annually by 2030.

However, battery manufacturing remains a gap in the country’s export development strategy, with limited domestic processing of minerals needed for battery production despite the Philippines’ substantial nickel resources.

Yet, Solidum said DOST has received proposals involving technologies. ‘But there are a lot of proposals for batteries. Different batteries,’ he said.

The push to build local EV manufacturing is being pursued alongside the government’s Electric Vehicle Industry Strategy (EVIS), which provides incentives intended to attract investments in EV and component manufacturing.

For the science chief, developing the local supply chain will require more than attracting vehicle assemblers. The country also needs stronger research and development (RandD), charging infrastructure and manufacturing capacity. ‘We already have an RandD center, but hopefully the other private sector would have their own RandD,’ he said, referring to the E-Mobility Research and Development Center established under DOST’s Niche Centers in the Regions for RandD program.

Private-sector participation in RandD would help expand the technologies available for local EV manufacturing, he said.

The country also needs a wider charging network as EV adoption grows. While charging equipment may be imported, DOST is also developing local charging technologies and working with local governments, he said.

Beyond technology and components, Solidum said the country needs capital to establish factories capable of producing EVs at scale. ‘That’s what we need, capital, investment, to build plants that will support local production to create more jobs,’ he said.

A larger domestic EV manufacturing base could also generate jobs beyond factories, including in after-sales services, he added.

Solidum said DOST is continuing to engage businesses that can invest in manufacturing facilities or adopt technologies developed through government-supported research as the country builds its EV industry.

Globe Telecom Inc. said over the weekend it has submitted a proposal for a unified national policy on underground conduit infrastructure, a move aimed at eliminating fiber theft and fiber cuts after the telco recorded more than 14,000 fiber cut incidents in 2025.

The proposal, filed under the Private Sector Advisory Council (PSAC) Digital Infrastructure sector, calls for a coordinated national framework to guide the planning, construction, and governance of underground conduit systems across the country.

It seeks to address the fragmented implementation of conduit projects across local government units (LGUs) by establishing national technical standards, designating a lead agency to oversee nationwide deployment, and assigning accountability for the maintenance of digital infrastructure.

Froi Castelo, Globe general counsel and president of the Philippine Chamber of Telecommunications Operators (PCTO), said the proposal is ‘timely’ given the Dig Once Policy under Section 17 of the Konektadong Pinoy Act, or Republic Act 12234.

‘A common policy for shared use of underground conduit infrastructure will give the industry a common framework for planning, deployment and long-term management,’ he said.

‘Clear governance and consistent national standards will accelerate network rollouts, improve resilience to service disruptions and optimize investments that ultimately benefit consumers and the country’s digital economy.’

=Castelo noted that climate-related disasters, as well as accidental and intentional fiber cuts, continue to disrupt connectivity even as the country’s digital economy expands.

Globe reported that it completed more than 1,500 kilometers of underground fiber facilities, which it said contributed to a significant reduction in fiber cut incidents in covered areas.

‘Digital infrastructure is now as essential as roads infrastructure and power systems. A unified underground conduit framework can help the country build networks that are more resilient, and better equipped to support the Philippines’s growing digital economy,’ said Joel Agustin, Globe SVP for service planning and engineering. The proposed policy also encourages closer coordination between national government agencies and LGUs in developing a National Underground Conduits Master Plan, establishing common technical standards, and creating a governance framework for the long-term operation and shared use of underground infrastructure.

THE Energy Regulatory Commission (ERC) outlined its priorities for a resilient and competitive Philippine energy sector, highlighting oversight of a P3.19 trillion industry.

During the American Chamber of Commerce (AmCham) Annual 9th Energy Forum held last week, the agency shared regulatory measures and priorities during the forum, emphasizing the need for regulation to keep pace with the evolving needs of the country’s energy sector.

‘The ERC oversees an industry valued at approximately P4.19 trillion, covering generation, transmission, distribution, and supply,’ ERC Market Operations Service (MOS) Director Sharon O. Montañer said. She added that the ERC strategy focuses on strengthening grid reliability, expanding consumer choice through 100-kilowatt (kW) retain competition open access (RCOA), promoting investment, and facilitating the energy transition.

To strengthen power system reliability, the ERC is advancing measures such as the proposed Philippine Grid Code 2026, transmission development and the timely connection of new generation resources, strengthened reliability performance rules, and renewable energy (RE) integration in off-grid areas.

On competition, the ERC is expanding opportunities for consumers to participate in the competitive electricity market through the implementation of the 100-kiW contestability threshold under RCOA and the Retail Aggregation Program (RAP).

The commission is likewise pursuing reforms to promote a more predictable investment environment, including the rationalized rules for setting distribution wheeling rates and the streamlining of regulatory processes, while advancing reforms in distributed energy resources and behind-the-meter technologies to facilitate greater consumer participation in the energy transition.

Montañer emphasized that these initiatives are interconnected. They form part of the ERC’s broader objective of building an electricity sector that supports economic growth, promotes competition, attracts investment, and remains adaptable as the country transitions toward a cleaner and more resilient energy future.

‘Resilience is not simply the ability to recover from disruption. Resilience is the ability to emerge from disruption with a stronger system than before,’ Montañer said.

The ERC’s urgent tasks were broadened with the recent State of the Nation Address (Sona), where President Ferdinand Marcos Jr. directed the removal of the system loss charge from the electricity that users are billed for, as well as the value added tax imposed on it.

The ERC has proposed a draft resolution to remove the 12-percent VAT on system loss charges, aiming to lower electricity bills for consumers.

It also required all distribution utilities to submit their system loss data from 2021 to 2025 and every year thereafter. In particular, the data required for submission include the generation purchased cost, transmission cost, energy output, energy input, sub-transmission and substation, feeder technical loss, non-technical loss, and kilowatt hour (kWh) shouldered by the DU in excess of the feeder loss cap, if any.

THE country’s poverty incidence declined further in 2025, according to preliminary estimates from the Department of Economy, Planning, and Development (DepDev).

Data presented by DepDev during the Development Budget Coordination Committee (DBCC) briefing on Monday showed the poverty rate fell to 9.7 percent in 2025 from 15.5 percent in 2023.

If finalized, the 2025 figure would mean the Marcos administration reached its goal of bringing poverty incidence below 10 percent ahead of its 2028 target.

‘Based on the country’s official poverty lines and the preliminary estimates for 2025, poverty incidence, or the proportion of the population being poor among Filipinos, fell from 18.1 percent in 2021 to 9.7 percent in 2025,’ Socioeconomic Planning Secretary Arsenio M. Balisacan said in his presentation.

‘This means that 8.8 million Filipinos were lifted out of poverty over this period,’ he added.

Based on initial estimates presented by DepDev, the 9.7-percent poverty rate was based on a national poverty threshold of P14,634 per month for a family of five, higher than the P13,873 threshold in 2023.

The preliminary threshold for the National Capital Region was higher at P16,842 per month, while the food poverty threshold was estimated at P554 per day for a family of five.

Balisacan said the poverty line is intended primarily to track changes in poverty over time as the threshold is adjusted for inflation.

He also stressed that the threshold should not be interpreted as the amount required for a decent standard of living.

‘It’s not so much to say that a threshold like P554 is enough to meet a decent living,’ he said.

DepDev said the decline in poverty reflected the recovery in incomes and employment as well as the continued implementation of social protection programs.

Balisacan cautioned, however, that the gains remain vulnerable to elevated inflation, particularly among poor and low-income households, which spend a larger share of their budgets on food.

Based on PSA data, food accounts for 51.38 percent of the inflation basket of the bottom 30 percent of income households. Rice alone carries a weight of 17.8 percent in their basket, nearly double its 8.87 percent share in the basket for all income households.

Food inflation was recorded at 5.3 percent in July, reversing the 0.5 percent deflation recorded in the same month last year. Rice inflation, meanwhile, stood at 19.3 percent, the highest since July 2024.

‘If inflation remains elevated, it could slow or even reverse our recent gains in poverty reduction,’ Balisacan said.

Preliminary results of the 2025 Family Income and Expenditure Survey (FIES), which will serve as the basis for the final poverty incidence estimates, are expected to be released later this month.