‘Consumption likely lifted Q2 growth’
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WADE OF THE NATION
TRONG domestic consumption may have boosted the economy’s performance in the second quarter of 2025 despite the uncertainty in the global economy and higher tariffs, according to the Department of Economy, Planning, and Development (DepDev). This, amid the recent reduction in the GDP growth forecasts of the Asean+3 Macroeconomic Research Office (Amro) and the Asian Development Bank (ADB) to below 6 percent this year and next year. DepDev Secretary Arsenio M. Balisacan told reporters on Wednesday that the economy
In flood-hit Cainta, Rizal, Greenpeace activists waded into murky waters and placed a cardboard cutout of President Marcos Jr., alongside banners reading “This is the State of the Nation” and “Make Polluters Pay.” The protest, staged across rain-drenched communities in and around Metro Manila, underscored calls for urgent climate accountability. “We call on President Marcos to use his SONA platform to push for bold climate action,” said Virginia Benosa-Llorin, Senior Campaigner at Greenpeace Philippines. GREENPEACE PHILIPPINES
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would benefit from the lag effects of the interest rate reductions and slower inflation, which may have improved the second quarter economic growth compared to the first quarter 2025. “That’s (domestic demand) what you can count on. And that’s actually what’s saving our economy now with all this uncertainty in the global economy. It’s domestic. So we have to strengthen that,” Balisacan said. He also assured the public that the government is working on reforms to improve the country’s competitiveness. This will prepare
the country for changes in the global economy. “If the economy improves, the global economy, we are ready. Unlike in the past decades, even though the global economy improved, we were not ready. So we missed the boat. So, that’s where we’re at. Still a lot of things to do,” Balisacan said, partly in Filipino. The strength of the domestic economy and policy reforms could help as Amro now expects the economy’s growth to average 5.6 percent in 2025 and 5.5 percent in 2026. Domestic demand, however, See “Consumption,” A2
BusinessMirror A broader look at today’s business
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ECONOMISTS FLAG RISK IN PHL-US TRADE DEAL www.businessmirror.com.ph
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Thursday, July 24, 2025 Vol. 20 No. 284
P25.00 nationwide | 3 sections 24 pages | 7 DAYS A WEEK
By Cai U. Ordinario @caiordinario
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HE reduction of one percentage point in the tariff rate to be imposed by the United States on Philippine goods starting August 1st may have come at a steep price, according to local economists. On Wednesday, President Marcos said the Philippines struck a deal with the United States for a 19-percent tariff rate on the country’s exports entering America, lower than the 20 percent announced earlier. One concession was for the Philippines to remove duties on US goods entering the domestic market. Local economists believe this poses a risk that the Philippines will become a dumping ground for US goods. It will also place local manufacturers at a disadvantage since they could face steeper competition from cheap imports. “There’s a real risk of the Philippines becoming a dumping ground, as zero tariffs make it easier for US goods to flood the market,” Unionbank Chief Economist Ruben Carlo O. Asuncion told BusinessMirror. See “Economists,” A9
“BEAUTIFUL VISIT” US President Donald Trump and Philippine President Ferdinand Marcos Jr. meet in the Oval Office in Washington on Tuesday, July 22, 2025, to finalize a sweeping trade deal slashing US export tariffs to zero while keeping Philippine goods at a 19-percent rate. Also present from the Philippine delegation are Foreign Affairs Secretary Maria Theresa Lazaro, Defense Secretary Gilberto Teodoro Jr., and National Security Adviser Eduardo Año. US officials include Treasury Secretary Scott Bessent, Secretary of State Marco Rubio, and Defense Secretary Pete Hegseth. AP/ALEX BRANDON
‘ARSI’ EYES POLICY TOOLS FOR TARIFF-HIT SECTORS
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HE national government can use policy tools to shield sectors that may be affected by uncertainty resulting from the US tariffs, according to the Department of Economy, Planning, and Development (DepDev). One policy tool could allow affected industries to reimburse their Research and Development or innovation spending to make themselves more competitive in the global market, DepDev Secretary Arsenio M. Balisacan said. Balisacan said this possible
reimbursement is not a tradedistorting measure; it is allowed under the current trade regime and will not be flagged by the country’s trade partners. “There are many tools of public policy. For example, if you really want to protect a particular sector that was affected, then you can use another policy to offset the losses of that sector. For example, maybe you can reimburse fully their R&D investment or innovation investment,” Balisacan told reporters on Wednesday. See “Arsi,” A9
Marcos, Trump meet before tariff deadline By Samuel P. Medenilla
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@sam_medenilla
ESPITE Manila’s affirming its ironclad defense cooperation with Washington, President Ferdinand Marcos’ “tough” tariff negotiations with US President Donald Trump resulted in only a 1-percentage point reduction on the 20-percent duties on Philippine goods, which will take effect next month. In exchange for the minimal reduction, which is still higher than the 17-percent initial tariff imposed by Trump in April, the Philippines has agreed to remove its tariffs on cars and other certain goods from the US and to buy more American products.
After his meeting with Marcos on Tuesday (US time), Trump posted on social media that a 19-percent tariff will be imposed on Philippine goods with the condition the Southeast Asian country will be an “open market” for US goods. The US earlier announced the new rates take effect August 1.
Open market
MARCOS confirmed the agreedupon 19 percent tariff, but he clarified that the zero tariff regime will only apply to some sectors such as cars. He maintained that the one percent concession was significant when put in “real terms.” “We will open that [automobile] market and no longer charge tariffs on that,” he said in a press briefing
with reporters in Washington. He also said the Philippines has agreed to increase its imports of US goods including soy products, wheat products, and medicine. “So, we are coming to those arrangements. There’s still a lot of detail that needs to be worked out on the different products and the different exports and imports,” Marcos said. In a joint press conference at the White House last Tuesday (US time), Trump described Marcos as a “tough negotiator” when they were finalizing the “big trade deal.” “He is negotiating too tough. In fact, I used to like him better than I do now. But we will probably agree on something. But he is a strong negotiator. He loves your country,”
Trump said when asked about the status of the tariff talks. Marcos, however, admitted that the 19- percent tariff was not based on his decision, when he was asked how he can justify the outcome of the tariff negotiations to Filipinos, especially the local manufacturers who may be negatively affected by it. “That number doesn’t come from the Philippine government. So, you will have to ask whoever imposed the 19-percent tariff how they justify it. I couldn’t answer it,” he said.
Possible renegotiation
MARCOS and his economic team headed to Washington D.C. this week in their bid to negotiate for See “Marcos,” A2
PESO EXCHANGE RATES n US 57.0180 n JAPAN 0.3889 n UK 77.1511 n HK 7.2639 n CHINA 7.9529 n SINGAPORE 44.6080 n AUSTRALIA 37.3468 n EU 67.0019 n KOREA 0.0413 n SAUDI ARABIA 15.1995 Source: BSP (July 23, 2025)