Philippines Expected to Sustain 6%+ Economic Growth Amid Strong FDI and Young Workforce

The Philippine economy is projected to sustain growth above 6% over the next two years, driven by foreign direct investments (FDI) and a young, growing workforce, according to HSBC Philippines. Corrie Purisima, head of markets and securities services at HSBC, predicted a 6.4% GDP expansion for 2025, potentially accelerating to 6.7% in 2026.

This sustained growth could position the Philippines as one of Southeast Asia’s top economic performers. Although these estimates fall slightly below the government’s target of 6.5-7.5% for 2025, growth in 2026 would align closely with the government’s 6.5-8% target range through 2028.

A young workforce and growing renewable energy investments are key growth drivers. The Philippines, with a working-age population projected to peak later than other ASEAN nations, offers significant potential for long-term FDI in sectors like IT, business process management, and renewable energy.

Service exports, particularly in information technology and business process management (ITBPM), also show strong growth potential. The sector, bolstered by digitalization, now contributes more to the economy than traditional overseas remittances.

HSBC projects 2024 GDP growth at 5.8%, slightly below the government’s 6-7% target. Sandeep Uppal, HSBC Philippines CEO, expressed optimism for even higher growth, noting that a rate above 7% could make the Philippines a “superstar” in Asia, given the potential to reach double-digit growth.