‘Q1 GDP woes of greater concern’ By Malou Talosig-Bartolome & Andrea E. San Juan
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DISNEY ADVENTURE DOCKS IN SINGAPORE Disney Cruise Line’s Disney Adventure arrives at Marina Bay Cruise Centre Singapore on
March 3, marking the first Disney cruise ship to homeport in Asia. The vessel was welcomed with a ceremonial water salute and fireworks display ahead of its maiden voyage from Singapore on March 10, ushering in a new era of Disney cruise experiences in the region.
ROTARY CLUB OF MANILA JOURNALISM AWARDS
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ORMER Cabinet Secretary Rene Almendras said he is more alarmed about the Philippine economy’s first-quarter performance than the potential fallout from the ongoing war involving the United States, Israel and Iran. “But we have other challenges in the Philippine economy, which is our GDP for the first quarter. We’re worried about that,” Almendras told the BusinessMirror during Japan’s National Day reception Tuesday night. Meanwhile, the Philippine economy will likely grow at a faster pace of 5 percent in 2026, seen to be propelled by a “gradual” recovery in public investment and government spending, according to projections by Switzerland-based UBS Investment Bank.
Almendras, who serves as the private sector representative to President Marcos Jr.’s advisory body, the Legislative-Executive Development Advisory Council (LEDAC), underscored weak consumption and reduced infrastructure spending as critical risks in the first quarter. “I’m worried about consumption. I’m worried about the reduced spending of government and infrastructure,” said Almendras, who also served as energy and acting foreign affairs secretary during the presidency of Benigno Simeon “Noynoy” Aquino.
UBS: 5 percent growth in 2026
IN a statement on Wednesday, the Zurich-based lender UBS said it expects the Philippine economy to “rebound to 5 percent” in 2026 after it expanded by 4.4 percent in 2025. “Looking ahead, we believe growth is near
its trough, and we expect quarterly sequential momentum to strengthen to 1.4 percent over the next two quarters, and GDP growth to be 5 percent in 2026,” UBS said. According to UBS, its revised forecasts penciled in “gradual and backloaded” recovery in public investment, starting with a small uptick in the first quarter of 2026, with spending returning to the levels in the second quarter of 2025 by the fourth quarter of this year. UBS said this as it pointed out that private investment indicators were “more resilient than expected.” “Private construction, which accounts for roughly 40 percent of construction valueadded, expanded 18 percent year-on-year, supported by gradually declining inventories,” the Zurich-based lender said. See “GDP,” A10
BusinessMirror A broader look at today’s business
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NG DEBT BREACHES ₱18T ON FRONTLOADED LOANS www.businessmirror.com.ph
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Thursday, March 5, 2026 Vol. 21 No. 144
P25.00 nationwide | 2 sections 22 pages | 7 DAYS A WEEK
By Reine Juvierre S. Alberto
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HE national government’s outstanding debt breached the P18-trillion mark in January, having frontloaded its borrowings in the first month of the year to shield itself from rising global interest rates. The Bureau of the Treasury (BTr) reported on Wednesday that the government’s outstanding debt grew by 2.41 percent to P18.133 trillion as of endJanuary 2026 from P17.707 trillion in end-December 2025. “This level remains sustainable amid pressing challenges in the domestic and global landscape,” the Treasury said in a statement. The increase was fueled by the government’s strategy of frontloading domestic and external issuances to secure concessional financing terms ahead of global market uncertainties that can further raise interest costs. Year-on-year, the outstanding debt jumped by 11.16 percent from P16.312 trillion. About 68 percent of the total debt stock was owed to domestic lenders, while the remaining 32 percent came from foreign sources, limiting exposure See “Debt,” A2
RIVER CHANNEL UPGRADE INSPECTED Department of Public Works and Highways Secretary Vince Dizon, Marikina City Mayor Maan Teodoro, and Marikina First District Rep. Marcy Teodoro inspect the Pasig–Marikina River
Channel Improvement Project in Marikina City on Wednesday, March 4, 2026. The project is designed to boost flood mitigation efforts, reinforce riverbanks, and improve water flow to help protect riverside communities during periods of heavy rainfall. NONOY LACZA
Short-term pressures may widen BOP gap MERALCO REVIEWS FUEL
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URTAILED foreign investments and elevated oil prices could widen the gap of the Philippines’s balance of payments (BOP) in the near term, analysts noted. “The Middle East conflict mainly affects us through higher oil and shipping costs, which can put some pressure on the trade balance and the [balance of payments] BOP. But the key point is this: the January BOP deficit was much smaller than last year, so we’re starting from a stronger position,” Jonathan L. Ravelas, senior adviser at Reyes Tacandong & Co. told the BusinessMirror in a Viber message on Wednesday. “We may see some short-term pressure in the coming months if oil prices stay high or markets turn
risk‑off, but a sharp BOP deterioration is unlikely unless the conflict escalates significantly,” he also told this newspaper. Data from the Bangko Sentral ng Pilipinas (BSP) showed the country’s balance of payments registered a deficit of US$373 million in January 2026. That BOP deficit in the first month of the year is 90.85 percent narrower than the $4.078-billion deficit posted in January 2025, and leaner by 54.90 percent than the $827-million deficit in December 2025 which is the largest gap in the BOP in 8 months. For his part, Philippine Institute for Development Studies (PIDS) Senior Research Fellow John Paolo Rivera said that since the Philippines is a net oil importer, sus-
tained increases in crude prices would raise the country’s import bill, potentially widening the current account deficit and putting pressure on the BOP. Rizal Commercial Banking Corp. chief economist Michael L. Ricafort said the BOP gap may also widen “if oil and other commodity import bills go up.”
Impact on FDIs
RIVERA said there may also be “indirect effects” on the BOP through weaker global trade or more volatile capital flows if geopolitical risks trigger investor caution. Ravelas also noted that rising Middle East tensions can make foreign investors more cautious, adding that “some [foreign direct
investment] FDI decisions may be delayed rather than canceled.” As such, he said that the key to keeping FDI flowing is “stability” at home with clear policies, predictable rules and steady growth in place. “If those are in place, FDI should remain resilient despite global geopolitical noise,” Ravelas also told this newspaper. It is worth noting that softer FDI inflows may contribute to a wider deficit in the balance of payments as these are recorded in the financial account of the BOP. In fact, Security Bank chief economist Angelo Taningco said in a televised interview that “foreign investments might be curtailed because you have a low investor confidence.”
SUPPLY STATUS AMID WAR
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ANILA Electric Co. (Meralco) is reassessing its fuel supply position as hostilities between Iran and the United States-Israel alliance escalate, its chairman said on Wednesday. The country’s largest power distributor, however, moved to ease public concern, saying the conflict has yet to affect electricity prices in March—though an impact in April remains possible. Meralco Chairman Manuel V. Pangilinan said the company is taking stock of its exposure to key fuel inputs, particularly liquefied natural gas (LNG), coal, and diesel, as prolonged tensions in the region threaten to drive up global commodity prices. “Meralco will review its current fuel posi-
tion—especially LNG, the likely impact on the price of coal, the price of diesel—as these may affect...power prices,” Pangilinan said. “We want to ensure adequate supply of power and manage price volatility as responsibly as possible.” Pangilinan also appealed to Filipino consumers to reduce electricity consumption while the conflict persists, noting that the country imports a significant portion of the fuel used to generate power. “It would also help if we’re mindful of our electricity consumption as the war in the Middle East continues,” he said. “We import much of the fuel used to generate power—we can all help to have enough power to get through See “Meralco,” A2
See “BOP,” A2
PESO EXCHANGE RATES n US 58.3090 n JAPAN 0.3697 n UK 77.8950 n HK 7.4715 n CHINA 8.4270 n SINGAPORE 45.6538 n AUSTRALIA 41.0087 n EU 67.7317 n KOREA 0.0394 n SAUDI ARABIA 15.5379 Source: BSP (March 4, 2026)