Q3 GDP revised downward to 3.9%

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January 29, 2026 | 12:00am

MANILA, Philippines —  The Philippine economy grew at a slightly slower pace in the third quarter than initially estimated as revisions were made in three sectors, according to the Philippine Statistics Authority (PSA).

In a statement yesterday, the PSA said that the third quarter gross domestic product (GDP) growth rate was revised downward to 3.9 percent from the preliminary estimate of four percent to reflect adjustments in certain sectors.

Major contributors to the downward revision were electricity, steam, water and waste management (-0.6 percent from 0.6 percent); real estate and ownership of dwellings (four percent from 4.7 percent) and accommodation and food service activities (4.8 percent from 5.7 percent).

The PSA said the third quarter 2025 gross national income was also revised downward to 5.4 percent from 5.6 percent.

The PSA said the revision policy “is consistent with international standard practices on national accounts revisions.”

Data on the country’s economic performance in the fourth quarter last year and full-year 2025 will be released today.

Department of Economy, Planning and Development Secretary Arsenio Balisacan earlier said the economy likely missed last year’s growth goal of 5.5 to 6.5 percent, amid challenges including governance issues that weighed on investor and consumer sentiment. He said the economy likely expanded by about 4.8 to five percent last year.

Economists polled by The STAR also expect 2025 GDP growth to be below the government’s target and lower than the 5.7 percent growth posted in 2024.

Malacañang, however, expressed optimism that the Philippines would achieve a “better economic growth in the coming period” following reforms aimed at addressing corruption and attracting investments.

Presidential Communications Undersecretary Claire Castro said last year’s slowdown and the lower projected growth this year are results of lingering geopolitical tensions and the impact of the flood control issue on disbursement and investments.

“The reforms on budgeting and disbursements and project monitoring initiated last year (will) take ground and with recent investor-friendly reforms and sound macroeconomic fundamentals, we would expect  better GDP growth in the coming period,” the Palace press officer said at a press briefing yesterday.

“The President wants investments to increase to have more quality jobs and higher employment to reduce poverty,” she added

Castro acknowledged that the noise created by the investigation into the flood control projects had an impact on growth.

She also said the successive earthquakes and typhoons have also affected the economy. The downward revisions on the Philippine growth outlook by international institutions like the World Bank and the Asian Development reflected “lingering global uncertainties, tighter financial conditions and the moderation in domestic activity observed in the third quarter,” she added.

“Nonetheless, the Philippine economy grew by five percent in the first three quarters of 2025 and we acknowledge that more prudent government expenditures especially on infrastructure due to the flood control scandal affected growth in the fourth quarter,” Castro said. –  Alexis Romero