THE Philippines will likely miss its target of lowering poverty to 8.8-9.0 percent by 2028 under current conditions, the World Bank said on Thursday.
“As of this moment, we’re not projecting poverty below in single digits by 2028,” World Bank senior economist Liliana Sousa told reporters in a briefing.
Baseline projections show poverty remaining above the government’s target by the end of President Ferdinand Marcos Jr.’s term unless policy interventions are strengthened, she added.
Under the 2023-2029 Philippine Development Plan (PDP), the Marcos government targeted a poverty rate of 8.8 to 9.0 percent by 2028 from 18.1 percent as of 2021.
“This is expected to result from sustained economic growth that generates more and better-quality jobs, and is supported by an efficient social protection system,” the PDP states.
Under the Ambisyon 2040 plan, meanwhile, the government is targeting the eradication of poverty by that year.
Progress ‘far from secure’
The World Bank said the Philippines had made progress in reducing poverty, with the rate at 15.5 percent as of 2023 from 23.5 percent in 2015.
“This progress is, however, far from secure,” it added.
Nearly 28 percent of Filipinos remain vulnerable and could fall back into poverty and only about a quarter of the population are securely in the middle class. The share of the latter — 24 percent — “has stagnated since 2018,” the World Bank said.
It also said that “the typical Filipino family earns just enough to stay above the poverty line — but not enough to feel economically secure.”
“In fact, many families are so close to the edge that a single typhoon, a hospital bill, or a lost job can push them back into poverty,” it added.
While the World Bank acknowledged that conditions could still change, its current outlook assumes a “business-as-usual” scenario based on existing growth trends and policy settings.
“With the right policy mix — one that boosts job creation and productivity while strengthening equity and resilience — the Philippines can all but eliminate poverty by 2040 and firmly put most of its people in the secure middle class,” World Bank division director Zafer Mustafaoglu said.
“The goal is ambitious, but it is achievable with strong commitment to reforms,” he added.
Sousa said that creating better-paying jobs would be critical to helping more Filipinos achieve economic security.
She noted that many households classified as part of the emerging middle class remained unable to make a transition into being securely middle class.
“What’s really important about them is basically that they’re set to almost be in the middle class, except that they can’t get that job that’s going to pay them enough to move into the middle class,” she said.
“On one hand, you need to be growing higher-productivity jobs, creating these jobs so that more workers are able to earn more. At the same time, you need to look at the mix of policies and the incentives that they create in terms of better job creation,” Sousa added.
The World Bank also said that the 2040 goal of eliminating poverty would be missed, projecting a 6.0-percent incidence under a business-as-usual scenario and an improvement to 2.9 percent if reforms were implemented.
The ranks of the middle class, meanwhile, was forecast to hit 55 percent given “sustained ambition and coordination,” up from 43 percent sans reforms.
Gains seen slowing
Thursday’s World Bank briefing echoed a report issued in April where the multilateral institution said that poverty gains were likely to moderate this year.
“Poverty reduction is projected to slow, with poverty expected to reach 12.9 percent by 2028, as exceptionally weaker growth in 2026, cooling job creation and higher fuel prices weigh on progress,” it said.
“Expanding job opportunities and social protection to help households cope with climatic and price shocks remain essential to sustain gains,” it added.
The World Bank said Philippine economic growth could markedly slow to 3.6 percent this year, a level last seen in 2011. The forecast is lower than 2025’s below-target 4.4-percent growth and is also below the government’s 5.0- to 6.0-percent goal for this year.
Last year’s massive corruption scandal will continue to affect public investment and private sector confidence and the war in the Middle East will add a “severe negative supply shock.”
“Higher oil and gas prices are projected to raise inflation, compress real incomes, and increase input and transport costs, dampening consumption and investment,” the World Bank said.
“Export demand is expected to suffer as the global economy slows,” it added.
The World Bank expects a rebound to 5.6 percent for 2027-2028 as conditions normalize and budget execution, public investments and electronic export demand improves.