PSEi dips on growth worries, weak Wall Street cues

Philippine shares retreated on Tuesday as investors weighed slower economic growth projections, lingering corruption issues and negative cues from US markets.

The Philippine Stock Exchange Index (PSEi) fell 0.38% or 22.46 points to 5,756.66, while the broader all-share index dropped 1.5% or 49.25 points to 3,231.55.

“The local market’s sideways movement ended in negative territory as it gave in to selling pressures,” Japhet Louis Tantiangco, research manager at Philstocks Financial, said via Viber. “Investors digested Finance Secretary-turned-Executive Secretary Ralph Recto’s projection for 2025 GDP (gross domestic product) growth of 4.7-4.8%.”

“The lingering corruption issues amid the latest developments also weighed on sentiment,” he added.

Profit taking after Monday’s sharp gains added to the decline, according to Luis Limlingan, head of sales at Regina Capital Development Corp.

“Investors turned cautious after locking in gains from the previous session’s strong run,” he said in a Viber message, noting that sentiment dropped somewhat after Mr. Recto’s growth comments.

Sector performance was mixed. Services slid 1.65% to 2,361.09, mining and oil fell 1.31% to 12,826.45 and industrials dropped 1.06% to 8,387.74.

In contrast, property rose 1.12% to 2,109.62, financials added 0.27% to 1,898.35 and holding firms inched up 0.02% to 4,483.45.

SM Prime Holdings led gainers, climbing 4.65% to PHP 21.40, while ACEN Corp. lagged, falling 5.69% to PHP 2.32, Mr. Tantiangco said.

The decline followed US market weakness. On Monday, the S&P 500 and Nasdaq closed below their 50-day moving averages for the first time since late April, as investors awaited corporate earnings — including Nvidia — and a delayed US job report. The Dow also slipped below its 50-day average for the first time since Oct. 10, Reuters reported.

Market breadth was negative, with losers outnumbering winners 94 to 74, while 60 stocks were unchanged.

Value turnover decreased slightly to PHP 6.67 billion on 1.15 billion shares traded, down from PHP 6.76 billion on 1.12 billion shares on Monday. Net foreign selling widened to PHP 1.31 billion from PHP 171.2 million, reflecting cautious sentiment among overseas investors. — Alexandria Grace C. Magno

Cash remittances up 3.7% in Sept.

Money sent home by overseas Filipino workers (OFWs) jumped by an annual 3.7% in September, the fastest pace in five months, the Bangko Sentral ng Pilipinas (BSP) said on Monday.

Data from the central bank showed cash remittances rose to USD 3.12 billion in September from USD 3.01 billion in the same month in 2024.

This was the fastest growth since the 4% logged in April.

Month on month, cash remittances increased by 4.84% from USD 2.977 billion in August.

For the first nine months of the year, cash remittances sent through banks increased by 3.2% to USD 26.03 billion from USD 25.23 billion a year ago.

“The United States remained the top source of remittances to the Philippines during January-September 2025, followed by Singapore, and Saudi Arabia,” the BSP said in a statement.

Cash remittances from the US accounted for 40.4% of the total in the nine-month period.

This was followed by Singapore (7.1%), Saudi Arabia (6.4%), Japan (4.9%) the United Kingdom (4.8%), the United Arab Emirates (4.5%), Canada (3.5%), Qatar (2.9%), Taiwan (2.8%) and South Korea (2.5%).

Meanwhile, personal remittances went up by 3.8% to USD 3.46 billion in September from USD 3.34 billion a year earlier.

In the January-to-September period, personal remittances rose by 3.2% to USD 28.97 billion from USD 28.07 billion a year ago.

Personal remittances include both cash coursed through banks and informal channels as well as in-kind remittances.

Analysts said OFWs sent home more money starting September, as the holiday season approaches.

“The ‘ber’ months effect kicked in early, with OFWs sending more ahead of the long holiday season,” Reyes Tacandong & Co. Senior Adviser Jonathan L. Ravelas said in a Viber message.

He added that the strong labor market and a competitive peso also supported remittance growth in September.

The peso closed at PHP 58.196 per dollar on Sept. 30, weakening by P HP 1.066 or 1.87% from PHP 57.13 on Aug. 29.

In September, the country’s unemployment rate improved to 3.8% from 3.9% in August. For the first nine months, the jobless rate stood at 4.1%, a tad higher than 4% in the same period last year.

“The onset of ‘ber’ months marks the start of the holiday season for Filipinos. Thus, we may expect OFWs to send their earnings to their families here for the celebrations and gatherings,” Oikonomia Advisory and Research, Inc. economist Reinielle Matt M. Erece said in a Viber message.

Mr. Erece said remittance growth could be faster from October to December, before stabilizing in January 2026.

“For the fourth quarter, expect remittances to stay resilient and peak in December. BSP’s 3% full-year growth target looks well within reach,” Mr. Ravelas likewise said.

The BSP expects cash remittances to grow by 3% to USD 35.5 billion this year. —Aaron Michael C. Sy, Reporter

Go named as Finance chief, Recto as executive secretary

Philippine President Ferdinand R. Marcos, Jr. on Monday appointed Finance Secretary Ralph G. Recto as the new executive secretary and economic czar Frederick D. Go to take over the Finance department, marking the biggest Cabinet shake-up since the eruption of the multibillion-peso flood control scandal.

“These leadership changes reinforce the President’s commitment to strengthening institutions, improving coordination across government, and keeping the administration focused on delivering stability, opportunity, and security to Filipino families,” Palace Press Officer Clarissa A. Castro told a news briefing.

The appointments were announced after Mr. Marcos accepted the resignation of Executive Secretary Lucas P. Bersamin and Budget Secretary Amenah F. Pangandaman.

“Both officials respectfully offered and tendered their resignations out of delicadeza, after their departments were mentioned in allegations related to the flood control anomaly currently under investigation and in recognition of the responsibility to allow the administration to address the matter appropriately,” Ms. Castro said.

She said Mr. Recto’s extensive background in economic legislation and national planning “positions him well” to oversee day-to-day government operations and coordinate high-impact programs as executive secretary.

Sought for comment at the Senate, Mr. Recto told reporters he had not talked to the President.

“I’m surprised but work has to continue. Essentially, I think the role of the [executive secretary] is governance… You cannot do miracles. Our job is to improve governance,” Mr. Recto said.

Concerning Mr. Go’s appointment as Finance chief, Ms. Castro cited his role in “advancing investments, strengthening investor confidence, and aligning economic initiatives across agencies.”

In a statement, Mr. Go thanked the President for his “continuing trust and confidence.”
“Recognizing the challenges and opportunities ahead, I am fully committed to promoting fiscal strength and sustainable economic growth for the country,” Mr. Go said.

There is no replacement yet for Mr. Go, who held the title of special assistant to the President for investment and economic affairs.

Budget Undersecretary Rolando U. Toledo will be the officer in charge at the Department of Budget and Management (DBM).

“(Mr. Toledo’s) designation ensures uninterrupted operations as the government prepares for the rollout of next year’s budget, ongoing recovery efforts in disaster-affected regions, and the continued funding of social and economic programs,” Ms. Castro said.

The Philippine government is investigating a multibillion-peso public works scandal that Mr. Marcos exposed during his State of the Nation Address in July. Government officials and lawmakers have allegedly colluded with private contractors to receive billions of kickbacks from public works projects.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said Mr. Recto is signaling a focus on governance reforms.

“Drawing on his 20 years of experience in fiscal and policy measures, Mr. Recto’s serious pursuit of anti-corruption initiatives and higher governance standards — similar to efforts 10-15 years ago — could have positive effects on the local economy and financial markets,” he said.

Growth at 4%

Prior to the announcement of his appointment as executive secretary, Mr. Recto said the Philippine economy is likely to expand by at least 4.7% this year.

In a statement sent Monday morning, he said the economy remains “fundamentally strong,” backed by stable foundations, investment opportunities, and growth faster than the “true cost” of debt.

“By the end of 2025, the real interest rate we pay is estimated at only 3.3%, while our economy is expected to grow by 4.7% to 4.8%,” Mr. Recto said.

Philippine gross domestic product (GDP) growth averaged 5% in the first nine months, falling short of the government’s 5.5-6.5% target for 2025.

The government’s sweeping corruption crackdown since August has hurt economic growth as well as consumer and investor confidence.

“We are not blind to the challenges, nor are we shaken by them. What you see today is not a leadership crisis, but a government reforming itself from within, led by a President who chose to be the whistleblower, not the apologist, of corruption,” Mr. Recto said.

He stressed that trust is the lifeblood of any economy.

“It keeps investments flowing, businesses expanding, and jobs growing. That trust is being protected, strengthened, and rebuilt every single day under the Marcos administration,” he said.

Mr. Recto, who is part of the Monetary Board, said weak inflation gives the Bangko Sentral ng Pilipinas (BSP) more room to cut interest rates, supporting household spending and economic growth.

“Above all, we assure the Filipino people that our fiscal consolidation path is on track, and everything moving forward is on the upside,” he said, noting that the government will bring down the deficit and debt gradually.

The Marcos administration is targeting to reduce the fiscal deficit to 5.5% of GDP in 2025, with the gap projected to ease further to 3.1% by 2030.

The country’s outstanding debt stood at PHP 17.46 trillion at end-September but still remained above the PHP 17.36-trillion full-year program. — Chloe Mari A. Hufana and Aubrey Rose A. Inosante, Reporters

Vehicle sales flat in October despite rising EV demand

Vehicle sales hit just over 40,000 in October, as rising demand for electric vehicles (EVs) failed to offset the decline in passenger car sales, an industry report showed.

A joint report by the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and the Truck Manufacturers Association (TMA) showed new vehicle sales inched up by 0.03% or 11 units to 40,014 in October from 40,003 units in the same month a year ago.

Month on month, vehicle sales went up by 5.2% from 38,029 units sold in September.

Passenger car sales declined by 18.8% to 8,155 units in October from 10,044 units sold in the same month in 2024. Month on month, passenger car sales edged up by 2.6%.

Meanwhile, sales of commercial vehicles, which accounted for 79.62% of October sales, rose by 6.3% to 31,859 units from 29,959 units a year ago.

Month on month, commercial vehicle sales increased by 5.9%.

Under the commercial vehicle segment, light commercial vehicle sales grew by 3% to 22,471 units, while Asian utility vehicles (AUV) rose by 17.2% to 8,309. On a monthly basis, sales of light commercial vehicles and AUVs climbed by 6.5% and 4.6%, respectively.

Sales of medium-duty trucks and buses declined by an annual 6.4% to 352 in October, while light- and heavy-duty vehicles grew by 6.4% and 10%, respectively, to 661 and 66 units.

Compared with September, light-duty truck sales increased by 12.2%, while medium- and heavy-duty truck sales fell by 5.1% and 4.3%, respectively.

Toby Allan C. Arce, head of sales trading at Globalinks Securities and Stocks, Inc., said that auto industry sales are being impacted by elevated interest rates and shifting consumer preferences.

“This stagnation is largely attributable to the continued slump in passenger car sales — a sharp contraction that reflects weakening demand for sedans and hatchbacks amid high interest rates earlier in the year and a clear consumer preference shift toward crossovers, sport utility vehicles, and commercial vehicles,” he said in a Viber message.

For the January-to-October period, new vehicle sales slipped by 0.2% to 383,424 from 384,310 units a year ago.

Passenger car sales fell by 23.2% to 77,461 in the first 10 months from 100,809 in the same period last year.

On the other hand, sales of commercial vehicles went up by 7.9% to 305,963 units from 283,501 a year ago.

In the first 10 months, the industry has already achieved 76.68% of its 500,000 sales target for the year.

Bright spot

Meanwhile, electric vehicles remained a bright spot for the industry.

In October, EV sales jumped by 62% to 3,603 units from 2,223 units in September. This accounted for 9% of the total market.

Sales of hybrid EVs (HEV) surged by 73.9% to 3,044 units in October from 1,750 HEVs sold in September.

Sales of plug-in hybrid electric vehicles (PHEV) soared by 192.6% to 275 units in October from 94 in September, while sales of battery electric vehicles (BEV) declined by 25% to 284 units from 379 units in September.

For the first 10 months, EV sales stood at 24,265 units, accounting for 6.33% of the industry’s sales.

Broken down, 19,379 units of hybrid electric vehicles had been sold as of end-October, followed by 3,941 BEVs and 945 PHEVs.

“Aggressive discounting from Japanese and Chinese brands, expanding inventories of hybrid and fuel-efficient models, and strong fleet demand from ride-hailing, delivery, and provincial transport cooperatives are poised to lift overall sales,” said Mr. Arce.

He said new model launches are expected to further stimulate showroom activity.

For this year, CAMPI expects EVs to account for 4% of the total industry sales.

Toyota in the lead

Meanwhile, Toyota Motor Philippines Corp. remained the market leader, with sales of 185,201 units in the January-to-October period, up 3.8% from 178,421 units a year ago. It accounted for 48.3% of the market.

Mitsubishi Motors Philippines Corp. ranked second with a market share of 18.97% after sales dipped by 0.9% to 72,734 units in the first 10 months.

In third spot was Ford Motor Co. Phils., Inc., whose sales dropped by 20.7% to 18,631 for a market share of 4.86%.

Rounding out the top five were Suzuki Phils., Inc., which saw a 9.1% increase in sales to 18,295, and Nissan Philippines, Inc., which saw a 18.7% decrease in sales to 18,125 units.

Mr. Arce said that he expects car sales to recover in November and December.

“The final two months of the year historically deliver some of the strongest sales as brands push year-end promotions, banks ease auto loan requirements, and consumers take advantage of holiday bonuses,” he said.

Mr. Arce said recent rate cuts by the central bank will help lower financing costs, which should help revive big-ticket spending, particularly for passenger cars.

“While passenger car sales may not fully rebound before year-end, the broader industry appears well-positioned for a stronger close to 2025 as consumer confidence firms and financing conditions ease,” he added. — Justine Irish D. Tabile, Reporter

Philippines is one of the most hybrid-work friendly markets in Asia-Pacific

The Philippine office sector is one of most hybrid work-friendly markets in the Asia-Pacific region, but some firms still face sustainability challenges, according to property consultancy firm Colliers Philippines.

In a survey conducted under its 2026 Asia Pacific Workplace Insights Report, Colliers said that 82% of Philippine organizations are adopting hybrid work models, with 32% looking to invest in workplace upgrades next year.

“Occupiers in the Philippines are moving beyond cost-efficiency to create workplaces that inspire, connect, and deliver lasting value,” Kevin Jara, head and director of office services — tenant representation at Colliers Philippines, said in a statement.

However, 26% of respondents from the Philippines said they are unsure about their sustainability approach, Colliers noted, citing the need for clearer strategies and landlord collaboration.

“While ESG (environmental, social, and governance) priorities remain a work in progress, today’s momentum signals meaningful progress. Indeed, the role of the workplace has evolved from a functional necessity to a strategic driver of culture, collaboration, and productivity,” Mr. Jara said.

Firms that align ESG principles with their workplace strategy could help boost company branding, Colliers said.

Key sustainability practices that offices should adopt include green building design, inclusive layouts, and transparency, it added.

Despite the growing shift to hybrid work, many organizations in the Philippines, Australia, Japan, Singapore, and New Zealand are still enforcing attendance mandates, Colliers noted.

“Attendance mandates remain common, highlighting the region’s ‘hybrid paradox,’ where flexibility exists on paper but traditional structures persist,” Colliers said.

It also noted that assigned seating is still prevalent in many Philippine workplaces, signaling limited agility in office setups.

“Even in flexible offices, early arrivals often claim the same seat. At the same time, some senior leaders are growing quite resistant to hybrid, implying concerns about productivity, collaboration, and culture,” Chris Archibold, Colliers managing director for Offices in Southeast Asia, said in the report.

“Hybrid isn’t a quick fix, it requires clarity, honesty and a deep understanding, of what works for your people, your business, and your market,” he added.

The report also noted that 43% Philippine organizations have already integrated multi-generational needs into their workplace strategies.

“Overall, the Philippines shows strong progress in hybrid adoption and inclusivity, coupled with planned investments. Closing gaps in sustainability and aligning flexibility with culture will be critical for Philippine-based organizations who seek to attract talent and drive long-term performance,” Colliers said.

Across the Asia-Pacific, companies’ work strategies focus on improving productivity (9.43%), talent attraction/retention (8.85%), improving employee experience or well-being (8.48%), and better location (8.11%).

About 74% of firms in the region said that their offices are at least half full on a typical work day, while 45% said their midweek occupancy exceeds 75%, Colliers said.

For design preferences, Asia-Pacific respondents also noted that they prefer workplaces with natural lighting (17%), biophilic features and green walls (15%), ambient temperature (14%), and more collaboration spaces (13%).

About 20% of the region’s firms use artificial intelligence (AI)-driven tools to enhance employee experience, while 20% have no AI integration plans, Colliers said.

“AI has the potential to make workplaces more responsive, adjusting layouts in real-time, tailoring sensory inputs and tracking usage to better align with how people work,” it said in the report.

Colliers surveyed more than 800 corporate occupiers across 11 Asia-Pacific markets, including the Philippines, China, Australia, India, Indonesia, Japan, New Zealand, Singapore, Taiwan, Hong Kong, and South Korea. — Beatriz Marie D. Cruz

Peso strengthens as investors look past flood scandal

The Philippine peso strengthened against the dollar on Monday as investors shifted focus from a widening corruption scandal linked to state flood control projects.

It closed at PHP 58.931 a dollar, up 13.4 centavos from Friday’s PHP 59.065 finish, according to Bankers Association of the Philippines data posted on its website.

The peso opened at PHP 59.055 and traded from PHP 58.91 to PHP 59.199 during the session. Turnover fell to USD 1.316 billion from USD 1.837 billion on Friday, reflecting a more cautious market.

“We are seeing sentiment moving on from the recent corruption issues, trending upward toward the close today,” a trader said by telephone.

The rally followed allegations at the weekend by former Party-list Rep. and Appropriations Committee Chairman Elizaldy S. Co that President Ferdinand R. Marcos, Jr. had ordered P100 billion in project insertions in the 2025 budget. The claims were rejected by the Presidential Communications Office and Budget Secretary Amenah F. Pangandaman.

Stronger remittances added support to the peso. Cash remittances rose 3.7% to USD 3.12 billion in September from a year earlier, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Year-to-date, remittances through banks increased 3.2% to USD 26.03 billion, bolstering consumer spending and providing a cushion for the currency ahead of the holiday season.

Traders expect the peso to move from PHP 58.90 to PHP 59.20 on Tuesday, while Mr. Ricafort forecasts a range of PHP 58.80 to PHP 59.05.

Meanwhile, MUFG Global Markets Research said the peso could remain near the PHP 59 level until the first quarter of next year as sentiment continues to be influenced by corruption concerns and their impact on government spending.

“We are nonetheless hesitant to be too bearish on PHP at current levels and hence look for it to come off gradually toward the PHP 58 mark, helped over time by a weaker dollar and some eventual improvement in government spending from the first half of 2026,” MUFG analyst Michael Wan said.

He cited the corruption allegations around flood control projects as the most significant macroeconomic driver for the peso, noting the negative spillovers to public spending.

Additional support may come from US tariff exemptions on selected Philippine exports, including coconut oils. President Donald J. Trump rolled back tariffs on more than 200 food products, including coffee, beef, bananas and orange juice in response to rising US grocery costs, Reuters reported.

Framework trade deals announced last week are expected to further reduce tariffs on goods from Argentina, Ecuador, Guatemala and El Salvador once finalized, with the possibility of additional agreements before yearend.

The peso’s performance is also underpinned by the country’s strong gross international reserves, which exceeded USD 109.7 billion, equivalent to more than seven months’ worth of imports. Seasonal inflows from overseas Filipino workers and conversion of US dollars ahead of Christmas spending are expected to continue providing support in the near term. — A.M.C. Sy

PSEi advances as bargain-hunters snap stocks

Philippine stocks advanced on Monday as bargain-hunters stepped in after last week’s sell-off, even as political tension tied to a widening flood-control corruption scandal kept broader sentiment cautious.

The Philippine Stock Exchange Index (PSEi) climbed 3.48%, or 194.77 points to 5,779.12, snapping a sharp decline on Friday. The broader all-share index added 0.63%, or 20.54 points to 3,280.8.

“The PSEi ended higher as the market took advantage of last Friday’s steep decline to buy stocks at a bargain,” Luis A. Limlingan, head of sales at Regina Capital Development Corp., said in a Viber message. “However, there is still no clear catalyst to drive long-term momentum, as uncertainty remains regarding the country’s economic growth.”

AP Securities, Inc. said the rebound reflected opportunistic buying following calls for accountability among local officials linked to irregular flood-control contracts, a scandal that has intensified pressure on the administration of President Ferdinand R. Marcos, Jr.

The government’s anti-graft campaign, launched in August, has disrupted public spending and contributed to softer output.

Gross domestic product expanded 4% in the third quarter, the slowest since 2021, as budget execution slowed amid investigations into infrastructure projects. Nine-month growth averaged 5%, below the government’s full-year goal of 5.5% to 6.5%.

Mr. Marcos has insisted that the corruption crackdown has strengthened trust in the country’s economic stewardship, saying business confidence has been “restored.” He said last week that people tied to anomalous flood-control contracts would face imprisonment before Christmas, adding political stakes to an already fragile economic backdrop.

Still, Monday’s trading reflected broad-based gains across sectors. Financials advanced 4.73% to 1,893.07, lifted by bargain-hunting in select banks.

Property firms rose 4.14% to 2,086.14, while services added 2.97% to 2,400.73. Holding firms gained 2.07% to 4,482.45, and industrials increased 1.79% to 8,478.39. Mining and oil was the day’s only decliner, slipping 0.3% to 12,997.29.

Market breadth was positive, with advancers beating decliners 115 to 74, while 59 issues were unchanged.

Value turnover improved to PHP 6.76 billion from PHP 6.26 billion on Friday, even as share volume fell to 1.12 billion from 1.68 billion. Net foreign selling widened to PHP 171.2 million from PHP 104.62 million, suggesting global funds remained cautious.

Offshore, Wall Street ended mixed on Friday as investors assessed the likelihood that the US Federal Reserve will delay interest-rate cuts in December.

The Nasdaq finished higher, supported by gains in some large technology names, while the S&P 500 slipped after an early drop sent all three major indexes lower by more than 1%.

Market attention is now turning to Nvidia Corp.’s results next week as investors weigh whether stretched valuations in artificial intelligence-related shares can hold. — Alexandria Grace C. Magno

Recto says 25-bp cut likely in Dec.

Finance Secretary Ralph G. Recto ruled out an “off-cycle” move on monetary policy easing despite weaker-than-expected third-quarter growth, but noted there is a high chance of a rate cut at the central bank’s next meeting.

“I’m not sure about an ‘off-cycle’ cut, but there’s a good chance for a rate cut before the end of the year,” Mr. Recto told BusinessWorld on the sidelines of a Senate hearing on Thursday.

He said the Monetary Board is more likely to cut the key policy rate by 25 basis points (bps) at the Dec. 11 meeting.

Asked if there is a chance for a 50-bp cut, Mr. Recto said: “There’s always a chance. It all depends on what happens. But I think there’s a higher probability for a 25-bp cut.”

Bangko Sentral ng Pilipinas (BSP) Deputy Governor Zeno Ronald R. Abenoja told BusinessWorld that they have not discussed any possible off-cycle monetary policy easing.

“I haven’t heard anything,” he said. “So, it’s probably just rumors. As far as I know, there are no discussions.”

In October, the BSP lowered borrowing costs by 25 bps to a three-year low of 4.75%. It has so far reduced the key policy rate by 175 bps since it began its easing cycle in August last year.

The slower-than-expected gross domestic product (GDP) growth in the third quarter and benign inflation give the BSP room for another rate cut in December.

The Philippine economy grew by 4% in the third quarter, the slowest growth seen in over four years or since the first quarter of 2021.

BSP Governor Eli M. Remolona, Jr. in October said they could cut rates by another 25 bps at the Dec. 11 meeting and potentially more in 2026 to support the economy amid a slowdown due to the ongoing flood control scandal.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort on Thursday said the third-quarter GDP data prompted speculation about an off-cycle interest rate cut.

Mr. Ricafort said it is “possible, but not 100% sure” for the BSP to cut rates before its scheduled meeting on Dec. 11.

“There have been rumors in the market since (Wednesday) about a possible off-cycle monetary easing, particularly a cut in large banks’ RRR (reserve requirement ratio), after the softer local GDP growth data (on Nov. 7),” he said in a Viber message on Thursday.

“Every (one) percentage point cut in large banks’ RRR is equivalent to about P180-billion additional liquidity infused into the banking system that could increase lending and other investments such as fixed income or bonds, among others,” he added.

On Feb. 21, the BSP cut universal and commercial banks’ RRR by 200 bps to 5%, which took effect in the week of March 28.

Meanwhile, Mr. Ricafort noted that the latest third-quarter GDP data have caused the yields on the PHP (Philippine peso) Bloomberg Valuation Service to decline slightly and the peso to slump to a fresh low against the US dollar.

On Nov. 12, the peso fell to a new record low after closing at PHP 59.17 versus the greenback, slipping by 18.5 centavos from its PHP 58.985 finish on Tuesday.

The BSP chief earlier said they will not intervene in the foreign exchange market unless the peso’s depreciation leads to inflationary pressures.

“I think the BSP intervenes just to make sure that the curve is not too wide,” Mr. Recto said.

“But I’m sure everyone knows that the BSP, to a certain degree, intervenes in the market just to flatten the curve.”

He also noted that the peso might not weaken further if both the BSP and the US Federal Reserve would cut in December.

“It all depends on what the Fed does,” Mr. Recto said. “If the Fed cuts rates also, then it would be the same.”

Last month, the Fed delivered its second 25-bp cut this year, bringing its interest rate to the 3.75-4% range. This brought its total cuts to 150 bps since September 2024.

However, December easing by the Fed remains uncertain as policymakers weigh concerns over economic data after US President Donald J. Trump ended the longest US government shutdown last week. — Katherine K. Chan

Philippine investment slump seen to persist amid corruption probe

The investment outlook is expected to remain weak through next year unless reforms are implemented and those linked to the flood control scandal are jailed, economists said.

“If reforms and transparency improve, we could see a turnaround by mid-2026,” Jonathan L. Ravelas, a senior adviser at Reyes Tacandong & Co. said in a Viber message to BusinessWorld on Nov. 13.

Geopolitical tensions, unpredictable policy shifts, and weak global demand may also risk further weighing on investor sentiment, he added.

Data from the Philippine Statistics Authority showed foreign investment pledges approved by investment promotion agencies slumped by 48.7% to PHP 73.68 billion in the third quarter.

Mr. Ravelas attributed this sharp drop in foreign investment approvals to the “shaken investor confidence” triggered by corruption concerns, policy delays, and global uncertainty.

“The message is clear: we need to restore trust and fast-track reforms to stay competitive,” he added.

The government’s sweeping corruption crackdown since August has hurt economic growth as well as consumer and investor confidence.

In the third quarter, gross domestic product (GDP) grew 4%, its weakest since 2021, as the corruption scandal slowed public spending. This brought the nine-month average to 5%, lower than the government’s 5.5-6.5% full-year target for 2025.

GlobalSource Partners Country Analyst Diwa C. Guinigundo said it would be difficult to invite a “reflow of foreign capital” without charging those involved in the flood control scandal with plunder and malversation of public funds.

“We need to restore public trust and confidence in the business outlook in the Philippines,” he told BusinessWorld in a Viber message.

Earlier this month, President Ferdinand R. Marcos, Jr. declared that business confidence in the Philippines has been “restored,” crediting his administration’s crackdown on government irregularities for bolstering trust in economic management.

Last week, Mr. Marcos said people linked to anomalous flood control projects will be jailed before Christmas.

However, Foreign Buyers Association of the Philippines (FOBAP) President Robert M. Young said the country is still “in the process” of regaining lost confidence.

Mr. Guinigundo blamed high business costs, corruption in infrastructure projects, and weak respect for contracts and the rule of law in the country for the slump in foreign pledges in the third quarter.

“Foreign investors remain skeptical about the country’s macroeconomic prospects after the weak third‑quarter showing,” Mr. Guinigundo said in a Viber message.

Amid global headwinds from higher tariffs and a fragmented trade system, Mr. Guinigundo said the Philippine government must slash red tape and bring down business costs.

Foundation for Economic Freedom President Calixto V. Chikiamco said weak investments will likely continue unless the administration undertakes major reforms.

“Possible headwinds: political instability due to failure to bring perpetuators of the public works fraud to justice and sharpening rift between the Marcos and Duterte factions,” he said in a Viber message.

Mr. Chikiamco said the “overvalued” peso and the “lousy” tariff deal with the US have also affected the investment outlook.

Meanwhile, Federation of Philippine Industries Chair Elizabeth H. Lee said that the peso’s slide to a new all-time low of P59.17 against the dollar reflects global and local challenges.

“Locally, unresolved corruption cases and stalled infrastructure projects have tested confidence and slowed growth,” she said in a statement over the weekend.

“The path forward is clear: we must resolve corruption cases with transparency and accountability,” she said, adding this will help “restore trust, attract investment, and unlock infrastructure spending.”

She said this will create the stability that manufacturers need “to expand production, safeguard employment, and drive growth.”

“By protecting jobs in manufacturing and showing that clean governance drives stability, we can shorten the peso’s weakness, rebuild confidence, and put the economy back on a stronger, more sustainable growth path,” she added.

Philippine Chamber of Commerce and Industry Chairman George T. Barcelon attributed the peso’s recent performance to rate cuts by the Bangko Sentral ng Pilipinas, “coupled with the higher demand of dollars due to foreign investors off-loading stock investments and buying dollars to remit their money.”

“Like many business and civic organizations, academy and church institutions, we are in solidarity with public sectors hoping for an unbiased resolution,” he said in a Viber message.

FOBAP’s Mr. Young said that the weaker peso does not benefit Filipino exporters much.

“Actually, there is no significant gain because we are importing most of the materials. When you import materials, of course you use dollars to pay,” he said in a phone interview. “So, if ever, there will be some gain, it will be a very, very small margin only.”

However, he said that the benefits of the peso depreciation are only enjoyed by those who do not import their raw materials. — Aubrey Rose A. Inosante and Justine Irish D. Tabile, Reporters

Philippines now turns to technology after flood control projects vanish

April B. Elisteria wades through knee-deep water every time it rains in her neighborhood in Las Piñas City. The 39-year-old helper at a private elderly care home and mother of four has lived with floods for as long as she can remember.

“Sometimes the floodwaters are thigh-high near the entrance of our community,” she said in an Oct. 8 Viber interview. “I walk a fair distance to the entrance because no car can enter our place anymore,” she added in Filipino.

Her family has elevated their home to keep floodwaters from seeping in. “We’ve been here for so long, we already got used to the situation,” Ms. Elisteria said. “When I get home, I take a shower right away to avoid getting sick.”

Floods remain a part of daily life for many urban poor Filipinos despite decades of government projects meant to address them. Now, those projects themselves are under scrutiny.

Government investigators recently confirmed that 421 of roughly 8,000 flood control projects nationwide were “ghosts” — nonexistent despite being allocated funds. The revelations triggered the removal of PHP 255 billion (USD 4.4 billion) worth of projects from the proposed 2026 national budget, effectively cutting flood control allocations to zero.

As the scandal unfolds, public officials are looking to technology to restore trust, improve transparency, and curb corruption by design. Blockchain ledgers, livestreamed bidding and satellite mapping are now being tapped to track how every peso of public works spending moves — and whether something actually gets built.

The Department of Public Works and Highways (DPWH) has faced recurring questions over the integrity of its flood control program, a key infrastructure item in annual budgets. The “ghost” project revelations reinforced long-standing suspicions of systemic graft tied to infrastructure contracts.

Digitalization, automation and the removal of personal discretion create systems that make corruption more difficult, experts said.

The DPWH has begun livestreaming procurement activities, and on Sept. 30 launched “Integrity Chain,” a blockchain-powered transparency platform developed with the Blockchain Council of the Philippines (BCP).

The system aims to embed accountability into infrastructure workflows by maintaining immutable records that cannot be secretly altered.

The platform functions like a digital ledger, Mark S. Gorriceta, a founding BCP trustee, said in a Zoom interview. Every transaction, every data point is permanent once entered, and any tampering will be visible, he pointed out.

The Integrity Chain will initially cover foreign-assisted projects, which already follow stricter standards.

“Validation does not rely solely on the government,” Mr. Gorriceta said. “Independent validators from civil society, the academe, media, and nongovernment groups will check the data before it’s finalized.”

Public Works Secretary Vivencio “Vince” B. Dizon said during the platform signing that he welcomes private sector scrutiny. “Everyone should be watching,” he said.

Mr. Gorriceta said AI (artificial intelligence) would also be integrated to verify data accuracy. In three months, he expects the players to share the results from the pilot phase.

At least 10 blockchain-related bills are pending in Congress. But experts warn against seeing blockchain as a cure-all.

“Blockchain won’t prevent collusion among vendors and government officials,” Jeffrey Ian C. Dy, a former undersecretary at the Department of Information and Communications Technology, said in a Facebook post.

He also said the government’s lack of expertise could create dependence on proprietary systems “akin to graft.” Mr. Dy has suggested limiting blockchain to transactional data, defining clear rules on data use, and determining who should access it.

Watching from space

Beyond blockchain, agencies are turning to space-based monitoring to catch irregularities early. The Department of Human Settlements and Urban Development (DHSUD) is integrating satellite and geospatial data into its oversight systems.

Its Automated Land Use and Zoning Compliance Assessment and Monitoring (AutoCAM) tool uses remote sensing, machine learning and geographic information systems to track whether land use complies with local plans — and whether flood control projects are built in appropriate areas.

Ibani C. Padao, officer-in-charge director at the DHSUD’s Environmental, Land Use and Urban Planning and Development Bureau, said AutoCAM could detect zoning violations in real time.

“In protected agricultural zones, for example, if the tool detects that residential structures are being built, it will be tagged as not allowed or conditionally allowed,” he told BusinessWorld via Zoom.

DHSUD Assistant Secretary Mylene A. Rivera said the agency’s challenge lies in ensuring local governments use their approved land-use plans.

“After approval, these plans are often shelved and not used as a reference for development,” she said in the same Zoom call in Filipino. “Even diligent local governments learn about violations only after the fact because they don’t see everything.”

Ms. Rivera said AutoCAM could compare approved land-use maps with satellite images from the Philippine Space Agency (PhilSA). “If the plan doesn’t match what’s happening on the ground, the system flags it in real time,” she said. “That saves local governments a lot of time.”

The DHSUD will also launch a digital platform called PlanSmart for Sustainable Human Development on Nov. 17. It integrates hazard maps with planning data to help local governments make risk-informed decisions.

The initial rollout will cover 15 local governments per regional office, or about 200 nationwide. The target is for all local governments to have risk-informed plans by 2028. AutoCAM is slated for nationwide rollout by May 2026.

The Department of Budget and Management (DBM) has revived an older technology-driven project tracking system known as Digital Information for Monitoring and Evaluation, or DIME. First launched in 2017, it uses drones, geotagging, and satellite images to monitor major public investments. It was discontinued in 2021 and relaunched in 2023 through a partnership with the local space agency.

“The initial goal is to integrate PhilSA’s imagery with DBM’s platform,” Romer Kristi D. Aranas, information technology officer at the space agency’s High-Performance Computing and Information Systems Division, said via Zoom.

PhilSA expects project images to be publicly available through the DIME website by 2026.

“We are ready as far as technical capability and access to data are concerned,” Julius M. Judan, senior science research specialist at PhilSA’s Space Mission Control and Operations Division, said in the same Zoom interview.

He added that satellite data would be cross-validated with project timelines and milestones “to reach relevant conclusions.”

Beyond the tools

Both Mr. Aranas and Mr. Judan stressed that government capacity-building is critical. “We integrate the data processing know-how and what the technical requirements are so it would be self-sustaining, and they can do it themselves long term,” Mr. Judan said.

Ms. Rivera of DHSUD said some local governments still lack the resources and expertise to use such tools effectively.

“You can’t give solutions if you don’t understand the situation on the ground,” she said in Filipino. “The goal is to make planning easy for them, to give them a template they can adapt to local realities.”

Experts say the technologies being deployed — blockchain, AI and satellite monitoring — mark progress toward transparency. Yet they emphasize that digital systems cannot replace political will.

Science and technology can provide tools that enable desired social outcomes, William G. Padolina, chairman of the Science, Technology and Innovation Foresight Steering Committee of the National Academy of Science and Technology, said in an e-mailed reply to questions.

“But the choice to harness which of these tools can promote societal interests, especially to recover from shocks, remains a political decision,” he added.

Mr. Dy said flood control corruption starts with budget enactment, which no technology could capture. “Perhaps the stance should shift from ‘anti-corruption’ to ‘increasing transparency in government.’”

Transparency advocates have long argued that corruption thrives in discretionary budgeting — a point made clear by the “ghost” projects’ discovery. Oversight mechanisms are often activated only after projects have been funded and payments released.

Economists note that eliminating P255 billion in questionable allocations could improve fiscal discipline in 2026, but warn of gaps in actual flood mitigation if legitimate projects are also delayed.

State efforts to digitize oversight represent a rare convergence of science, policy and accountability. Whether these systems will outlast political cycles — and actually prevent “ghost” projects — remains to be seen.

For residents like Ms. Elisteria, though, the test of reform will be simpler: the day her street finally stays dry. “I just hope the floods stop becoming a fixture in our lives because it’s so hard.” — Patricia B. Mirasol, Multimedia Producer

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