By Benjamin Cuaresma
MANILA, Philippines — The Philippines posted its lowest official poverty incidence on record in 2025, with the rate falling to 9.7 percent and pushing the share of Filipinos living below the government’s poverty threshold into single-digit territory for the first time.
The Philippine Statistics Authority (PSA) said the figure translated to about 11.08 million Filipinos living below the official poverty line, sharply lower than the 15.5 percent, or 17.5 million people, recorded in 2023.
The decline means roughly 6.5 million Filipinos were lifted out of official poverty in two years, putting the government ahead of its Philippine Development Plan target of reducing poverty incidence to between 8.8 percent and 9 percent by the end of the Marcos administration.
“For the first time, fewer than one in ten Filipinos is living below the poverty line,” Department of Economy, Planning, and Development Secretary Arsenio Balisacan said Friday.
He said the milestone showed that wider economic opportunities, combined with social protection programs, could produce measurable improvements in household welfare.
But economists cautioned that the headline figure should not be taken as a complete picture of the country’s current economic conditions.
Ateneo de Manila University economist Leonardo Lanzona questioned whether the poverty threshold used by the PSA adequately captures the actual cost of meeting basic needs.
The annual per-capita poverty threshold rose by 5.5 percent to P35,121 in 2025, from P33,296 in 2023. Over the same period, however, mean annual per-capita income increased by 22 percent to P104,072, from P85,291.
Lanzona said the relatively modest increase in the poverty threshold was particularly significant because the food budget underpinning the measure had previously been acknowledged as insufficient to meet basic nutritional requirements.
“The issue [is] that PSA’s own chief statistician already admitted, back in 2024, that the food budget behind this threshold was too low to meet basic nutrition,” Lanzona said.
He noted that the PSA had indicated it would correct the methodology, but the adjustment had yet to be applied.
“The 5.5-percent increase we’re seeing is consistent with the old, admittedly-too-low threshold, not the corrected one,” he added.
Lanzona warned that a revised poverty threshold could substantially increase the measured poverty rate, potentially making the country’s gains appear less dramatic.
The PSA, meanwhile, also recorded poverty incidence among Filipino families at 6.4 percent, equivalent to about 1.9 million poor families.
Government statisticians attributed the improvement to higher incomes and changes in the poverty threshold between 2023 and 2025.
Economic conditions during the period also provided support for the decline. The economy grew by an average of 5.1 percent in 2024 and 2025, while average inflation stood at 2.5 percent and unemployment at 4 percent.
But the 2025 figures do not yet capture the full impact of the economic pressures confronting Filipino households in 2026.
The country has faced an energy shock amid the Middle East conflict, with inflation remaining above the Bangko Sentral ng Pilipinas’ 3-percent target since March. Economic growth also slowed to 2.3 percent in the second quarter.
The Philippine Institute of Development Studies earlier warned that as many as 3.1 million Filipinos could be pushed below the poverty line under more severe energy-shock scenarios.
The World Bank likewise estimated that 2 million Filipinos could fall into poverty without government intervention and projected a 12.3-percent poverty rate by 2028, while warning that 28 percent of Filipinos remain vulnerable to falling back into poverty.
Lanzona said the latest poverty figure therefore needs to be viewed in the context of both the timing of the data and the adequacy of the poverty benchmark.
In effect, he argued, the 2025 figure reflects economic conditions from the previous period while using a threshold that critics say remains too low to fully capture present-day living costs.
Balisacan acknowledged that the pace of poverty reduction could slow as the administration enters its final years.
“Current developments may slow the pace of poverty reduction, but early indications do not point to a reversal of the gains we have achieved,” he said.
He said the government’s next challenge was not merely to reduce poverty further but to prevent families who had crossed above the poverty line from falling back into deprivation.
“As we enter the final years of the administration, our priority is to ensure that families who have moved out of poverty do not fall back into it,” Balisacan said.
He stressed the need for stronger economic growth, greater investment and productivity, job creation, workforce upskilling, and timely assistance for businesses and workers affected by economic and climate-related disruptions.
ia/xf
