Marcos administration Despite missing its development and fiscal targets through 2023, it is still optimistic that it can meet its targets under the Philippine Development Plan (PDP).
In an executive report, the Department of Economy, Planning and Development (DepDev) said results in the first three years of the PDP 2023–2028 showed a “mixed picture” as key targets were largely not met.
“External factors (geopolitical tensions, conflicts and global trade uncertainties) and domestic challenges (due to severe weather disturbances and COVID-19) have limited the effectiveness of PDP strategies in the first three years of implementation,” it said.
DepEd said a “crisis of public trust” emerged last year following a corruption scandal involving flood control projects. This led to a decline in business confidence and government spending, which contributed to a slowdown in gross domestic product (GDP) growth in the second half of 2025.
“With less than three years left to achieve PDP goals, the government should make 2026 a rallying point for the PDP,” DepDev said. “The government should use this time to take stock, reorganize and realign strategies, with the goal of reviving PDP implementation.”
The Marcos administration was not able to meet the economic development goals set in the PDP for the past three years.
The economy will grow 5.5% in 2023, well below the 6-7% target under the PDP. In 2024, GDP growth is projected at 5.7%, also missing the target of 6.5-8%.
Last year, Philippine GDP growth slowed to 4.4%, below the target of 5-6%, due to a corruption scandal.
DepEd said the Philippine economy continues to demonstrate solid macroeconomic fundamentals despite external and domestic headwinds.
“Growth is expected to rebound, job creation is stable, inflation is manageable and our financial system remains healthy with external buffers remaining adequate,” DepEd said.
The government has set GDP growth targets of 5-6% for this year, 5.5-6.5% for 2027 and 6-7% for 2028.
According to the report, the Marcos administration also missed its target of national government (NG) deficit-to-GDP ratio. In 2023, the ratio stands at 6.2% against the target of 6.1%. The ratio falls to 5.7% in 2024, but is still above the 5.1% target.
The NG deficit-to-GDP ratio averaged 5.6% in the first nine months of 2025, higher than the full-year target of 4.1%.
On the other hand, the Marcos administration achieved its NG debt-to-GDP ratio in 2023 (60.1% vs. target of 60-62%) and in 2024 (60.7% vs. target of 57-61%).
However, the NG debt-to-GDP ratio is expected to reach a two-decade high of 63.2% in 2025, exceeding the 56-59% target.
DepEd said NG debt remains manageable, “given that the portfolio is predominantly long-term and domestic, accounting for 82.5% and By the end of 2025, 68.4% of the total, respectively.”
The government missed its headline inflation target of 2.5-4.5% in 2023 when inflation rose to 6%. However, inflation is expected to decline sharply to 3.2% in 2024 and 1.7% in 2025, within the 2-4% target.
Also, DepEd said the government has exceeded its target in employment. The unemployment rate was projected to be 4.6% in 2023, below the 5.3-6.4% target, and 4.3% in 2024, slightly below the 4.4-4.7% target.
In 2025, the unemployment rate averaged 4.7%, slightly below the 4.8-5.1% target.
“The PDP headline indicators for which targets were achieved relate to tangible aspects of citizens' lived experiences, or areas most felt by the public: employment, quality of employment and poverty reduction,” it said.
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In the same report, DepEd said the government would aim to “deliver concrete results and implement reforms that strengthen economic performance and restore public confidence” amid the scandal.
“Public expectations are justifiably high, and trust can be shaken when questions arise about the integrity and distribution of spending. The government's practical response is clear, decisive, coordinated and measurable action – tight controls, clear accountability and systems that make it easy to track, audit and evaluate public spending,” it said.
The government can address the growing “trust deficit” with “institutional responses that enforce transparency and accountability and improve economic performance.”
“In the immediate term, it is imperative that the government establishes a clear and credible path to addressing the infrastructure corruption controversy and restoring public confidence,” DepEd said.
“At the same time, we must also minimize the economic losses that result from absent or substandard flood control infrastructure.”
Measures include accelerating rehabilitation in disaster-hit areas, upgrading the forecasting capacity of the Department of Science and Technology, and expanding local weather stations.
Other strategies include rationalizing classroom and work suspension policies to ensure safety while minimizing unnecessary disruptions, accelerating public works such as construction and maintenance activities during the dry season, and adopting a strategic global public relations campaign.
“DEPDev estimates that, in the third quarter of 2025, the suspension of work and classes could reduce GDP by about 0.6 percentage points,” it said.
The Department also recommended strengthening transparency and accountability by updating public dashboards showing which programs and projects are being implemented; and adopting technology-based monitoring of projects.
It also proposed a risk-based modeling system to prevent abuses in the tax audit selection process, as well as provide clear and accurate information on how tax dues are calculated.
While fiscal consolidation was an early commitment of the government, DepEd noted that no major tax measures were passed during the first three years of the Marcos administration. Instead, Congress passed revenue-reducing measures, making the fiscal situation difficult. — ARAInosante