Philippines roundup: Economic ties with Israel, 2026 growth forecast raised, US tariff impact

Philippines' growth unaffected by US tariff hike

The Philippine economy is expected to withstand a potential 19% US tariff with minimal disruption, says DEPDev Secretary Arsenio Balisacan. He credits the nation’s diversified exports and focus on productivity and infrastructure. Balisacan noted that broad export markets cushion GDP from tariff shocks, while import changes may have a larger effect. He assured that GDP targets remain intact due to strong fundamentals. To sustain growth, Balisacan emphasised the need to diversify exports, boost productivity, and remove barriers for businesses and startups.

Philippines, Israel eye closer economic ties

The growing economic partnership between the Philippines and Israel was highlighted at a July 29 gala attended by Israeli Economy Minister Nir Barkat and DTI Secretary Cristina Roque. Both officials expressed optimism about a potential free trade agreement and deeper cooperation in trade, tourism, and innovation. Barkat proposed reducing tariffs to zero, calling the countries’ economies “complementary.” He also noted untapped tourism potential, citing low Israeli tourist arrivals in the Philippines compared to Thailand, and stressed the need for direct flights to boost travel and people-to-people exchanges. He invited Filipinos, especially Catholic pilgrims, to visit the Holy Land and shared plans to restore biblical sites like the Pool of Siloam in Jerusalem.

IMF raises 2026 growth forecast for the Philippines

The IMF has upgraded its 2026 growth forecast for the Philippines to 5.9% from 5.8%, citing strong economic fundamentals and ongoing reforms. The revised outlook reflects continued confidence in the country’s resilience despite global challenges. For 2025, the IMF maintained its 5.5% growth forecast, aligning with the government’s target range of 5.5% to 6.5%.

Philippines' clean energy transition sees coal decline

Coal-fired power in the Philippines is set to decline by 5.2% in early 2025, the first drop since 2008, signalling a shift toward cleaner energy, according to IEEFA. Despite claims linking the decline to LNG, no new gas-fired capacity was added from 2017 to 2024. In contrast, over 1 GW of solar was installed in 2024, boosted by government-led renewable auctions. The country’s competitive power market also mandates least-cost energy sourcing, further supporting clean energy growth.

Philippines considers raising online gambling tax to over 30%

The Philippine government is reviewing its online gambling framework, with talks underway to tighten regulations, according to Finance Secretary Ralph Recto. While seen as a key revenue source, officials are weighing the risks of higher taxes. Currently, operators contribute 25% of gross gaming revenue to PAGCOR. Proposed reforms may raise this to 30% or more. However, Recto warned that excessive taxation could drive more operators underground, especially with 60% of the sector already unregulated.