Review of the Medium-Term Macroeconomic Assumptions and Fiscal Program for FY 2022 to 2025
May 24, 2022

The Development Budget Coordination Committee (DBCC) reviewed the government’s medium-term macroeconomic assumptions, fiscal program, and growth targets for FY 2022 to 2025 to take into account recent domestic trends and external developments. These adjustments are also in line with the preparation of the FY 2023 National Expenditure Program (NEP).

Real Growth Projections

The Philippine Statistics Authority (PSA) reported this month that the Philippine economy grew by 8.3 percent in the first quarter of 2022, surpassing the pre-pandemic gross domestic product level. This exceeded the median analyst forecast of 6.7 percent, making the Philippines one of the fastest-growing economies.

Growth was broad-based and was driven by industry and services at 10.4 percent and 8.6 percent, respectively. Meanwhile, agriculture slightly improved by 0.2 percent as the sector was held back by the persistence of African swine fever and elevated prices of basic agricultural commodities, among others.

The Philippine economy’s strong recovery in the first quarter of 2022 has moved us closer to our goal of achieving at least 7.0 percent growth this year. However, in light of heightened external risks such as the Russia-Ukraine conflict, China’s slowdown, and monetary normalization in the United States, the full-year growth target was slightly revised from 7.0 – 9.0 percent to 7.0 – 8.0 percent for 2022. Meanwhile, real GDP growth was retained at 6.0 – 7.0 percent for 2023 to 2025 as the economy is expected to sustain its strong recovery in the medium term.

Shifting the entire country to alert level 1, increasing the vaccination rate, especially for seniors and children, and reopening all face-to-face classes are crucial to further strengthen domestic demand, cushion the impact of external events, and achieve our growth targets.

Macroeconomic Assumptions

The DBCC also approved the following revisions to the macroeconomic assumptions based on emerging data.







3.7 – 4.7

2.0 – 4.0

2.0 – 4.0

2.0 – 4.0

Dubai crude oil (USD)

90 – 110

80 – 100

70 – 90

70 – 90

Exports of goods





Imports of goods





The average inflation rate assumption for 2022 was adjusted upwards and is projected to range from 3.7 to 4.7 percent, following the uptick in the price of food and energy as a result of ongoing geopolitical tensions from the Russia-Ukraine conflict and disrupted supply chains. Nevertheless, the DBCC maintained the inflation rate assumption at 2.0 to 4.0 percent for 2023 to 2025, consistent with the latest forecasts of other agencies and its deceleration over the medium-term.

Meanwhile, the assumption for the price of Dubai crude oil per barrel for this year was increased to USD 90 to 110 per barrel considering potential supply disruptions caused by the Russia-Ukraine conflict. Nonetheless, this is expected to decrease to USD 80 to 100 per barrel in 2023 and USD 70 to 90 per barrel in 2024 to 2025 as oil supply is expected to catch up over the medium term.

Medium-Term Fiscal Program

As economic activity is expected to continuously pick up over the medium-term, revenue projections were revised upward to PhP 3.633 trillion (15.3 percent of GDP) for 2023 and to PhP 4.063 trillion (15.6 percent of GDP) for 2024. Revenue collections for 2025 are also expected to increase further to PhP 4.549 trillion (16.1 percent of GDP).

Consistent with higher revenue projections, disbursements were also revised upwards to PhP 5.086 trillion (21.3 percent of GDP) and PhP 5.392 trillion (20.8 percent of GDP) for 2023 and 2024, respectively. Meanwhile, disbursements are projected to reach PhP 5.723 trillion (20.2 percent of GDP) for 2025.

Given the revised revenue and disbursement program, the DBCC maintained its target deficit at 6.1 percent of GDP for 2023, 5.1 percent of GDP for 2024, and projected the figure of 4.1 percent of GDP for 2025 as the government continues to adopt a fiscal consolidation strategy to lower the deficit back to pre-COVID-19 levels.

Following higher revenue collections for next year, the proposed FY 2023 national budget is pegged at PhP 5.268 trillion (22.1 percent of GDP).


The DBCC remains strongly committed to exercise prudent macroeconomic and fiscal management in prioritizing expenditures that translate to the betterment of micro communities in the country.

This is reflected in the direction of the FY 2023 expenditure that prioritizes health, disaster risk management, social security, digital economy, local government support, and growth-inducing expenditures such as crucial and shovel-ready infrastructure projects. All these will bring us closer to achieving the United Nations’ Sustainable Development Goals (SDGs).

Our economic progress in the past two years demonstrates that the government’s risk management approach has been effective. With the full implementation of Executive Order No. 166 adopting the 10-point policy agenda, we will be able to accelerate and sustain economic recovery from the COVID-19 pandemic.

As we transition to a new administration, we are confident that the country will not see an end to the enactment of more game-changing reforms. The DBCC stands ready to work closely with the economic managers of the incoming administration to achieve more sustainable and inclusive growth for the Filipino people.