Philippines likely to see balance of payments deficit: BSP | ABS-CBN
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Philippines likely to see balance of payments deficit: BSP
Philippines likely to see balance of payments deficit: BSP
MANILA -- The Philippines may post a weaker balance of payments position this year and next year, the Bangko Sentral ng PIlipinas (BSP) said.
MANILA -- The Philippines may post a weaker balance of payments position this year and next year, the Bangko Sentral ng PIlipinas (BSP) said.
"The overall BOP position is expected to show a deficit in 2025 and in 2026, with a wider current account gap resulting from a higher trade-in-goods deficit and lower net receipts in trade-in-services," the BSP said in a statement.
"The overall BOP position is expected to show a deficit in 2025 and in 2026, with a wider current account gap resulting from a higher trade-in-goods deficit and lower net receipts in trade-in-services," the BSP said in a statement.
The BSP said global economic growth may remain soft through 2026 as economies cope with changes in US foreign policy. President Donald Trump has imposed weeping tariffs on the United States' major trading partners.
The BSP said global economic growth may remain soft through 2026 as economies cope with changes in US foreign policy. President Donald Trump has imposed weeping tariffs on the United States' major trading partners.
The BSP also said the weaker Chinese economy, geopolitical tensions in the Middle East, and volatile commodity prices will also dampen global growth.
The BSP also said the weaker Chinese economy, geopolitical tensions in the Middle East, and volatile commodity prices will also dampen global growth.
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The BSP said merchandise exports will grow modestly in 2025 and 2026 after two consecutive years of decline. Exports of semiconductor--the Philippines' biggest export--will see flat growth in 2025, largely because of inventory correction as the industry works to keep pace with the rapidly evolving global demand.
The BSP said merchandise exports will grow modestly in 2025 and 2026 after two consecutive years of decline. Exports of semiconductor--the Philippines' biggest export--will see flat growth in 2025, largely because of inventory correction as the industry works to keep pace with the rapidly evolving global demand.
Services experts are also expected to grow modestly because of slower growth in business process outsourcing (BPO) services.
Services experts are also expected to grow modestly because of slower growth in business process outsourcing (BPO) services.
"The outlook for BPO services incorporates the adverse impact of the US job reshoring agenda, as well as the domestic challenges in the supply of skilled workers in Generative AI (GenAI) and data analytics," the BSP said.
"The outlook for BPO services incorporates the adverse impact of the US job reshoring agenda, as well as the domestic challenges in the supply of skilled workers in Generative AI (GenAI) and data analytics," the BSP said.
"Overseas Filipino (OF) remittances are expected to grow slightly below the long-term trend as major OF host economies, such as Saudi Arabia and Qatar, increasingly advocate for the localization of their workforce, affecting OFWs’ deployment prospects," the central bank added.
"Overseas Filipino (OF) remittances are expected to grow slightly below the long-term trend as major OF host economies, such as Saudi Arabia and Qatar, increasingly advocate for the localization of their workforce, affecting OFWs’ deployment prospects," the central bank added.
It noted, however, that tourism will return to pre-pandemic levels on the back of the continued entry of international tourists from Korea and Japan.
It noted, however, that tourism will return to pre-pandemic levels on the back of the continued entry of international tourists from Korea and Japan.
The Philippines' financial accounts, meanwhile, will be supported by sustained net inflows from both foreign direct and portfolio investments.
The Philippines' financial accounts, meanwhile, will be supported by sustained net inflows from both foreign direct and portfolio investments.
"Investor interest will be supported by the country’s macroeconomic fundamentals, along with ongoing reforms to enhance the ease of doing business, optimize tax incentives, and improve capital market efficiency," the BSP said.
"Investor interest will be supported by the country’s macroeconomic fundamentals, along with ongoing reforms to enhance the ease of doing business, optimize tax incentives, and improve capital market efficiency," the BSP said.
It noted, however, that a pause in US monetary policy easing may limit capital flows to emerging market economies like the Philippines, thereby tempering investment gains.
It noted, however, that a pause in US monetary policy easing may limit capital flows to emerging market economies like the Philippines, thereby tempering investment gains.
The Philippines posted a BOP surplus of $3.1 billion in February.
The Philippines posted a BOP surplus of $3.1 billion in February.
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