NEDA Optimistic About Q1 Economic Growth Amid Easing Inflation

The National Economic and Development Authority (NEDA) expects strong economic growth for the first quarter of 2025, citing declining inflation and a robust labor market as key drivers.

Positive Economic Indicators

NEDA Secretary Arsenio Balisacan highlighted that lower inflation has boosted private consumption, which plays a crucial role in economic performance.

“With inflation going down and the labor market remaining strong, we have a good first quarter,” Balisacan said in an interview.

Key economic data:

• Inflation slowed to 2.1% in February, down from 2.9% in January, mainly due to lower food and utility costs.
• Employment rate was at 95.7% in January, slightly lower than 96.9% in December 2024, but still indicating a stable labor market.

Growth Target and Global Trade Strategy

The Development Budget Coordination Committee (DBCC) is maintaining its GDP growth target at 6% to 6.5% for 2025.

Balisacan also emphasized the need to diversify trade partnerships amid global uncertainties, particularly those linked to U.S. President Donald Trump’s protectionist policies.

“We should be more aggressive in pushing for free trade agreements (FTAs) to expand our markets and attract investments,” he said.

Strengthening Government Budgeting

To improve government planning and resource allocation, NEDA and the Department of Budget and Management (DBM) signed a Joint Memorandum Circular (JMC) establishing the Program Convergence Budgeting (PCB) framework.

This framework aims to:
✔ Enhance inter-agency coordination in planning and budgeting.
✔ Prioritize high-impact programs aligned with the Philippine Development Plan (PDP) 2023-2028.
✔ Optimize public spending by eliminating redundancies and improving efficiency.

A PCB Steering Committee, co-chaired by NEDA and DBM, will oversee the initiative to ensure better use of government resources.

With these economic strategies in place, NEDA remains optimistic about sustained growth, job creation, and poverty reduction in the coming months.