TRUST and confidence need to be restored if the government wants economic growth to return to its potential, a Philippine Institute for Development Studies (PIDS) economist said.
“If you really wanted to boost the economy again, the first solution is to rebuild trust and confidence,” PIDS senior fellow John Paolo Rivera told The Manila Times on Tuesday.
“Somebody has to be accountable for the issues, the flood control issues; somebody has to be accountable,” he added.
Rivera said the pace of government construction and infrastructure projects, among the drivers of Philippine economic growth in previous years, still had to recover from last year’s massive flood control project scandal.
Gross domestic product (GDP) growth markedly slowed in the last six months of 2025, leading to a below-target 4.4-percent expansion for the full year.
Growth slowed further to 2.3 percent in the first quarter of 2026, with infrastructure spending yet to recover, raising the prospect of another miss.
Rivera said faster growth would not depend only on increased spending but also on restoring confidence among consumers and investors.
“It’s a cycle: consumption, investment and government spending,” he said. “Once we restore trust and confidence, then we can see an improvement in our GDP growth.”
University of the Philippines Prof. Maria Victoria Raquiza said the government also needed to demonstrate accountability over issues involving the national budget.
“We need working institutions that actually work,” she said.
“There is an urgency to this issue. But I guess the trust that we’re talking about, it’s not given freely to anyone sitting in the leadership role. It has to be earned,” she added.
Rivera also pointed to tourism as a sector that could contribute more significantly to Philippine growth.
Tourism already accounts for around 10 to 12 percent of GDP, he said, but its contribution could increase if the Philippines sustainably develops its natural resources and diversifies offerings for visitors.
Rivera noted opportunities in the blue and green economy, particularly through marine resources and nature-based destinations.
“If we can sustainably develop it, there will be new product development, there will be diversification, circuit development; its contribution will increase,” he said.
Rivera noted that domestic tourism was currently buoying the industry and that strengthening this sector could further improve economic activity while the country continues to develop its international tourism market.
