Slowing Growth Clouds Economic Outlook
The Philippine economy is on track to miss its 2025 gross domestic product (GDP) growth target for a second consecutive year. Corruption scandals weigh on consumer confidence and business sentiment. Under President Ferdinand Marcos Jr., the government had aimed for GDP growth of 5.5% to 6.5%. However, recent data suggests the economy is falling short.
According to a survey of 14 economists conducted by the Philippine Daily Inquirer, GDP likely expanded by just 4.2% in the third quarter. That performance would place full-year growth at around 4.8%. This is a notable slowdown from the 5.7% expansion recorded in 2024.
Weakest Expansion in Over a Decade
If confirmed, the 2025 outcome would mark the Philippines’ weakest annual growth rate since 2011. This excludes the sharp contraction caused by the COVID-19 pandemic in 2020. The last comparable slowdown occurred during an aggressive anti-corruption drive. That drive significantly reduced government spending.
This time, however, analysts point to a combination of political uncertainty, weakened consumer spending, and cautious corporate investment as the main drags on growth. High-profile corruption controversies have dampened confidence. As a result, both household consumption and private-sector expansion are limited.
Regulatory Overhaul Reshapes Gambling Sector
Meanwhile, 2025 also brought sweeping changes to the country’s gambling and online gaming landscape. Authorities tightened oversight through multiple regulatory measures. These include stricter advertising controls and higher minimum guaranteed fees for online gaming operators starting in April. In addition, there is a new business-to-business accreditation framework. It requires third-party suppliers to register by March 31, 2026.
In addition, lawmakers passed the Anti-Offshore Gaming Operator Act of 2025. They introduced tougher know-your-customer requirements, imposed minimum deposit and betting thresholds, and severed gaming mini-apps from e-wallet platforms. These steps followed a presidential decree imposing a total ban on Philippine Offshore Gaming Operators (POGOs). This effectively shuts down a once-lucrative segment of the industry.
Gaming Revenue Still a Bright Spot
Despite these headwinds, the Philippine Amusement and Gaming Corporation (PAGCOR) remains optimistic about the sector’s fiscal contribution. The regulator estimates gaming revenues of PHP116.65 billion (US$2.04 billion) for 2025. Of that, online gaming could account for as much as PHP65 billion (US$1.14 billion).
PAGCOR’s leadership continues to emphasize the industry’s economic value. They argue that tighter regulation strengthens long-term sustainability. Still, with broader economic momentum slowing, the challenge for policymakers will be ensuring that regulatory reforms do not further suppress growth. This is especially true at a time when the economy needs renewed confidence and investment.
