THE government will ramp up infrastructure spending this year to make up for lost economic growth following a massive corruption scandal, Cabinet officials said on Friday.
Public Works Secretary Vince Dizon told a briefing that his department would be spending P200 billion to P250 billion in the first quarter with the aim of “not just to spend more but ... to spend more wisely and spend for the right things.”
Economic growth markedly slowed to 4.0 percent in the third quarter of last year, from 5.5 percent three months earlier, as the government cut back on expenditures due to a flood control project scandal and as household spending also eased as confidence fell.
Government infrastructure spending fell by 13.7 percent to P943 billion for the first 10 months of 2025 from P1.09 trillion during the first 10 months of 2024, primarily driven by a contraction in Department of Public Works and Highways (DPWH) disbursements.
Dizon said the DPWH’s priorities included the upkeep and maintenance of the country’s roads and bridges and completion of unfinished infrastructure.
‘[W]e have to wrap this up because our economy needs infrastructure spending,” he said. “[W]e will have our targets, and we will do our best to deliver on our targets.”
Dizon expressed optimism that economic growth would rebound with increased government infrastructure spending.
Growth is widely expected to have fallen well below the 2025 target of 5.5-6.5 percent — central bank governor Eli Remolona last week said that it could have slowed to 4.6 percent from 5.7 percent in 2024 — and economic managers have lowered the forecasts for 2026 and 2027 to 5.0-6.0 percent and 5.5-6.5 percent from 6.0-7.0 percent.
Preliminary fourth quarter and full-year growth data for 2025 will be released on Jan. 29.
“Obviously, there’s still caution there. It’s cautiously optimistic,” Dizon said, adding that private sector stakeholders have said that they want concrete action from the government.
Finance Secretary Frederick Go told the briefing that “it’s important that the government responds accordingly and provides the ease, the predictability and the infrastructure or the programs that will help reduce the cost of doing business.”
He added that the government had designed “big, bold reforms,” including building the necessary infrastructure to allow businesses to thrive, improve the ease of doing business in the country and reduce the associated costs.
Go also stressed that the Philippines needed to be competitive if it wanted to attract foreign direct investments.
Other reforms have been put in place to support sustained economic growth, the Finance chief said, including the National Single Window that will consolidate trade requirements into a single digital portal, reducing red tape, delays and costs.
He also said that funding would be found for the Comprehensive Automotive Resurgence Strategy (CARS) program, the P4.32-billion allocation for which in this year’s national budget was vetoed by President Ferdinand Marcos Jr.
The funds were to be used to pay for incentives owed to automakers that signed up for CARS. Go said, “Car manufacturers enrolled in the program can now be assured that [the] government will fulfill its commitment to investors.”
He also welcomed the government’s decision to grant Chinese businessmen and tourists a 14-day visa-free entry through Manila and Cebu, saying it would “boost tourism, trade and investments and further improve relationships with our largest trading partner.”
He said these reforms, aimed at easing the cost of doing business and improving infrastructure, had been presented to private sector stakeholders to boost investor confidence and encourage greater investment.
“This is a clear signal that the Philippines is moving forward decisively and not being distracted,” the Finance chief said.
“Despite the challenges of the past year, our long-term fundamentals remain strong and intact. Our stable macroeconomic environment, enabling policies and dynamic workforce provide a solid foundation for sustainable growth. With this, we are now advancing with big bold reforms.”
