Debt payments rise in May D
ROTARY CLUB OF MANILA MARKS 106TH ANNIVERSARY The Rotary Club of Manila (RCM) celebrated its 106th Anniversary and Induction of Officers ceremony at Solaire Hotel in Parañaque City. The event featured vibrant performances by cultural dancers and the presentation of a token of appreciation. Outgoing RCM President Eduardo “Jujut” Enriquez III handed over the President’s pin to Incoming President Raoul Creencia. RCM Past President Alberto “Bert” Romulo served as the keynote speaker and officiated the induction of the new set of officers for Rotary Year 20252026. ROY DOMINGO
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ESPITE the double-digit increase in debt payments in May 2025, data from the Bureau of the Treasury (BTr) showed that the country’s debt service declined in the first five months of the year. BTr data indicated that the country’s debt payments rose by 16.04 percent to P80.047 billion in May 2025 from the P68.98 billion in May 2024. In January to May, debt service payments contracted 42.22 percent to P375.4 billion in 2025 from the P1.22 trillion recorded in the same period last year. Debt service payments are composed of interest payments and
amortization for both domestic and external borrowings. Interest payments in May grew 14.5 percent to P69.954 billion in 2025 from P61.097 billion in 2024. In the May to June period, interest payments went up by 11.37 percent to P357.4 billion from last year’s P321.585 billion. In terms of amortization, payments made in May grew 28.035 percent to P10.093 billion in 2025 from the P7.883 billion recorded a year ago. The amortization payments, however, declined 61.39 percent to P345.567 billion in January to May 2025 from P895.126 billion in the same period last year.
Meanwhile, domestic interest payments inched up by 13.54 percent to P52.311 billion in May 2025 from P46.071 billion in May 2024. In the first five months, domestic interest payments increased by 12.95 percent to P261.343 billion in 2025 from P231.376 billion in 2024. The bulk of the interest payments in 2025 made by the national government were composed of payments for Fixed Rate Treasury Bonds which amounted to P32.815 billion in May and P178.941 billion in the January-to-May period. This was followed by interest payments for Retail Treasury Bonds See “Debt,” A2
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Monday, July 7, 2025 Vol. 20 No. 267
P25.00 nationwide | 2 sections 20 pages | 7 DAYS A WEEK
By Cai U. Ordinario @caiordinario
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NFLATION rate may have eased to below 2 percent in the past four months, but this does not automatically translate to faster economic growth, according to Citi Philippines.
MUTED MOMENTUM
Inflation eases, but exports and output remain weak PMI TICKS UP–BUT JUST BARELY 51.25
3.0
51.00 PMI Index
Inflation Rate (%)
2.5 2.0 1.5
50.50 50.25 50.00
1.0
Neutral Line
49.75
0.5 0.0
50.75
Jul 2025
Q3 2025 avg
Q4 2025 avg
49.50 May 2025
Q1 2026
n PMI Value
June 2025
n Quarterly Forecast n 2025 Forecast: 1.7% n 2026 Forecast: 2.8%
Drivers of Disinflation: →Falling rice and fuel prices →Decline in wholesale and producer prices
Risks: →Rising service prices (education, recreation) →Inflation reacceleration if oil rebounds
❝Higher input costs, soft global demand, and domestic policy adjustments such as wage hikes❞ will keep manufacturing growth modest.— John Paolo Rivera, PIDS
Citi noted that growth indicators in April and May “remained soft” and that despite the talks between the United States and the Philippines, the country’s exports did not benefit from any frontloading. Based on the Purchasing Managers’ Index (PMI), the S&P Global Market Intelligence noted that
NO FRONTLOADING, NO BOOST–YET
→Exports show no benefit despite US-PHL talks →Electronics exports lagging behind ASEAN →Trump’s 17% reciprocal tariff pause looms ❝Despite optimism after the conclusion of trade talks with the US, Philippine electronics exports continued to lag ASEAN peers and have not benefited from any frontloading.❞ —Citi Philippines
BM Graphics: Ed Davad | Sources: S&P Global, Citi Philippines
INFLATION FORECAST PATH (2025–2026) (Citi)
the May data showed a “stagnation” (See: https://businessmirror.com.ph/2025/06/02/ ma y-factor y-act iv it y-indicates-stagnation/) and the June data showed that factory ouput was being pulled down by “stalled exports” (See: https://businessmirror.com.ph/2025/07/02/ See “PHL,” A2
SIPP INVESTMENTS TO CREATE THOUSANDS OF JOBS, SAYS DTI
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NVESTMENTS approved under the Strategic Investment Priority Plan (SIPP) will lead to the creation of 132,000 jobs, according to the Department of Trade and Industry (DTI) and the Board of Investments (BOI). DTI said a total of P3.38 trillion of investments were approved under SIPP from June 2022 to December 2024. It said a “substantial” portion of the projected employment will be in administrative and support services, power, and manufacturing sectors.
Trade and Industry Secretary and Board of Investments (BOI) Chairman Cristina A. Roque said these investments translate into “tangible benefits” for Filipinos by providing livelihoods and strengthening the country’s economic resilience. “These investments mean thousands of livelihoods for Filipinos and stronger foundations for our economy. As we work to attract strategic projects, our focus remains on translating these into real opportunities for our people,” she said. See “SIPP,” A2
LOADS OF OPTIMISM Container trucks line up for exit inspection at the Port of Manila’s North Harbor on a Sunday—underscoring the backbone trade logistics that sustain the Philippine economy. US Ambassador MaryKay Carlson, speaking at the US Embassy’s Fourth of July reception in Taguig, said both countries are “working very hard” to finalize a trade agreement. The negotiations aim to determine whether the US will extend or adjust the current tariffs—including the 17-percent reciprocal rate set to resume on July 9, 2025, after the 90-day suspension expires. NONIE REYES
Groups, govt racing to cut logistics cost By Andrea E. San Juan
L
@andreasanjuan
OCAL trade groups and relevant government agencies are targeting to finish the review of logistics cost and other trade fees in the Philippines by the end of the year to mitigate the impact of the tariffs imposed by Washington. “We’re not able to see yet the actual impact of this. But then again, right now, we’re reviewing the cost of logistics, reviewing the port charges, reviewing the imposed taxes. We have to find ways and means on how to mitigate the impact of this tariff,” PCCI President Enunina Mangio told reporters in an interview on Friday. Mangio said the Philippines still has the highest logistics cost compared to its neighboring countries. This review, she said, could
pave the way for the reduction in logistics costs. A study conducted by the World Bank in 2017 showed that the country’s logistic cost is around 27 percent of the total cost of goods. Last April, Procurement and Supply Institute of Asia (PASIA) President Charlie Villaseñor raised the same concern during a forum on logistics. “Logistics cost ranges from 28 to 35 percent, depending on the commodity. And where are we compared to our Asean neighbors in terms of logistics? It’s sad to say. If you will refer to the Logistics Performance Index, you will see that the Philippines is not very well-positioned,” he said. “Looking at the logistics cost of other countries, tayo ang pinakamataas. That’s why it’s being addressed right now. This includes,
handling, custom charges, so those things are being reviewed right now,” Mangio said. Asked if bringing down the logistics cost could offset the higher tariffs imposed by the US, Mangio
said, “I don’t think so, but at least we could reduce the adverse impact of the US tariffs.” She said the Bureau of Customs (BOC) and the Philippine Ports See “Groups,” A2
Freshly Brewed
RESILIENCE IN HYBRID BANKING CITYSTATE SAVINGS BANK PRESIDENT JIMI ARANETA ON HOW THRIFT BANKS ENDURE— AND EVOLVE—IN A CHANGING WORLD»A12
PESO EXCHANGE RATES n US 56.2810 n JAPAN 0.3883 n UK 76.8348 n HK 7.1727 n CHINA 7.8477 n SINGAPORE 44.1489 n AUSTRALIA 36.9822 n EU 66.1808 n KOREA 0.0414 n SAUDI ARABIA 15.0074 Source: BSP (July 4, 2025)