To the members of the European Chamber of Commerce of the Philippines and the EU-ASEAN Business Council;
My colleagues in the Philippine Economic Team;
Distinguished guests and esteemed business leaders;
A pleasant day to all!
Assalamu alaikum wa Raḥmatullahi wa Barakatuh.
It is my honor to address this esteemed gathering of the most dynamic business leaders in trade and industry from Europe, Southeast Asia, and beyond. I would also like to express my sincere appreciation to the European Chamber of Commerce of the Philippines and the EU-ASEAN Business Council for fostering deeper dialogue and championing stronger ties between the Philippines and the European Union. You have been invaluable partners in our journey, even amidst global and domestic challenges.
We do hope to further cement the Philippines’ position as a strategic trade and investment partner of European nations. As you know, just last October 6, I was in Brussels to attend the 5th Philippines-EU Subcommittee Meeting on Good Governance, Rule of Law, and Human Rights. I am glad I was able to personally express my support for our points of cooperation and to hear the concerns of the EU with respect to the Philippines.
And today, I stand before you to share a clear message: The Philippines maintains its status as one of the fastest-growing economies in the Asia Pacific Region, and we are determined to stay on track with our Agenda for Prosperity, to meet an upper-middle-income status soon, and bring down our poverty level to single digit. Towards this end, we hope to strengthen our partnership and further increase European investor confidence in the Philippines.
Sustaining the Growth Momentum
I am pleased to share with you that despite geopolitical and economic headwinds, the Philippine economy remains resilient, expanding by 5.5 percent in the second quarter of 2025, thanks to our sound fiscal management, pro-growth reforms, and a steadfast commitment to creating a competitive and inclusive economy.
FY 2026 National Expenditure Program
In our first three years, our focus was to recover from the effects of the pandemic and achieve high GDP growth. Our strategy was to focus heavily on infrastructure with the Build Better More program. Now in the second half of our term, we are focused on ensuring sustainability by investing in our people.
Hence, the proposed FY 2026 National Expenditure Program, which totals Php 6.793 trillion, equivalent to 22 percent of GDP, prioritizes nurturing future-ready generations.
By Sector
In line with our commitment to further empowering every Filipino, the President’s proposed budget, which we call the National Expenditure Program, allocates 34.1 percent or USD 40.6 billion to Social Services, and 27.5 percent or USD 32.77 billion to the Economic Services sector.
Education
Under the Social Services sector, we will give the highest priority to education. Aside from fulfilling our Constitutional mandate, we have significantly increased the budget for basic and higher education to USD 21.47 billion, allowing us to meet, for the first time, UNESCO's recommendation of allocating at least 4.0 percent of the GDP to education, through a whole-of-government approach for the education sector.
This is our immediate response to the learning crisis. On top of this, we are creating over 65,000 teaching and non-teaching positions, doubling the teaching allowance, providing scholarships to more students, and establishing Child Development Centers in more barangays nationwide, among others.
Health
Healthcare also remains a top priority.
To ensure equitable access to healthcare, we are now implementing the Zero Balance Billing policy. This means we will provide free hospitalization for patients admitted under basic accommodation in selected hospitals under the Department of Health. Under this scheme, all associated costs—including room and board, professional fees, diagnostic tests, surgery, and medicines—will be fully covered by PhilHealth or the Philippine Health Insurance Corporation.
This policy will be supported by the DOH’s Medical Assistance to Indigent and Financially Incapacitated Patients program. To complement this, we will also provide a higher budget for DOH hospitals in Metro Manila and other regions, which will cover the operations of the Bagong Urgent Care and Ambulatory Service (BUCAS) centers.
Social Protection
We are likewise strengthening social protection.
Following the devastation caused by the series of typhoons and earthquakes that hit the country, we ordered the immediate release of funds to jumpstart rehabilitation efforts, the replenishment of the Quick Response Fund (QRF) of the Department of Social Welfare and Development and the Department of Public Works and Highways to speed up aid and recovery, and the release of additional funds for the Assistance to Individuals in Crisis Situations (AICS), among others.
For 2026, we will more than double the budget for the Pantawid Pamilyang Pilipino Program (4Ps), which will provide 4.4 million households with health grants, education allowance, and rice subsidies, not as dole-outs but as means to get by while they look for jobs or other sources of income.
We are also continuing the Food STAMP Program, which applies a dignity-oriented approach to food assistance given to food-insecure families through electronic vouchers.
As you can see, these are not just social programs; they are foundational investments in human capital development for any investor looking at long-term stability and workforce productivity.
Food Security
Under the Economic Services sector, we are scaling up agricultural productivity and food security by boosting rice production through the National Rice Program. We are also prioritizing the installation of irrigation systems and building post-harvest facilities, including cold storage. For agritech companies, food producers, and logistics firms, this presents a growing frontier for innovation and further investment.
Infrastructure Development
Meanwhile, infrastructure development remains a key driver of growth, with USD 27.3 billion, or 5.0 percent of GDP, to be allocated for the Build Better More Infrastructure Program in 2026.
These investments cover both physical and social infrastructure—from roads, bridges, and airports to schools, hospitals, and irrigation systems—supporting national connectivity and regional development.
Digital Transformation
Finally, to ensure efficient and effective public service delivery, the government’s Digital Transformation Agenda will be supported with USD 1.53 billion to provide Filipinos with access to free Wi-Fi and digital government services.
As mentioned, these are our proposed allocations under the FY 2026 NEP. I am pleased to share that just last Monday, October 13, the House of Representatives already approved House Bill No. 4058, or the FY 2026 General Appropriations Bill (GAB), on third and final reading.
While recent developments have placed the budget process under heightened scrutiny, we remain committed to advancing it with transparency, integrity, and accountability—ensuring that public funds are used efficiently and for the people’s welfare.
Budget Reforms
In line with this commitment, we are pursuing a reform agenda focused on modernizing systems, strengthening fiscal discipline, leveraging sustainability, and promoting transparency and bureaucratic efficiency. These reforms lay the foundation for a more predictable, transparent, and business-friendly environment, one that inspires confidence from both the private sector and the international community.
Procurement Reforms
Towards efficiency but even more so towards fighting corruption, one of the reforms I am most proud of is the New Government Procurement Act (NGPA), initiated by the DBM with our Procurement Service and the Government Procurement Policy Board, which I chair. This is hailed as the biggest anti-corruption measure in the country’s recent history as the law introduces new mechanisms to promote transparency, combat corruption, and improve efficiency in government procurement processes.
With the NGPA, we now have stronger safeguards against corruption and faster procurement.
We have developed an eMarketplace, similar to Lazada or Shopee, where government agencies can just “add to cart” and directly procure supplies and equipment from accredited, reputable suppliers.
The NGPA also requires full disclosure of all procurement data and documents, including bid results and contract information, through online platforms such as PhilGEPS. This includes Beneficial Ownership Disclosure, which requires bidders to disclose their beneficial owners, preventing conflicts of interest.
It likewise promotes the professionalization of public procurement practitioners by establishing a structured program for competence, integrity, and accountability.
Digital Transformation
We are modernizing our Public Financial Management (PFM) systems through the Integrated Financial Management Information System, beginning with the Budget and Treasury Management System. This enables real-time monitoring of government transactions, providing faster and more efficient public service delivery.
I am also pleased to highlight that the Philippines is now among the first countries in Asia to adopt a public blockchain infrastructure for tracking government spending. This groundbreaking initiative enables the public to access immutable, real-time records of key budget documents—such as Special Allotment Release Orders (SAROs) and Notices of Cash Allocation (NCAs).
And just this morning, we launched the Managed Information Network for Advanced Insight (MINAI) Project, an internal AI-powered knowledge management solution developed exclusively for DBM. This will serve as our centralized platform to strengthen institutional memory and enhance analytical capabilities through artificial intelligence.
Strengthening confidence in our budget institutions requires not only transparency but also the institutionalization of reform. As such, we are also working towards the codification of the budget process with the Philippine Budgeting Code, formerly known as the Progressive Budgeting for Better and Modernized Governance Bill, which has been included in the priorities of the Legislative-Executive Development Advisory Council, as it will ensure transparency, efficiency, accountability, and seamless transactions in government spending through IFMIS.
Likewise, we are leveraging technology through Project DIME, or the Digital Information for Monitoring and Evaluation, which uses satellites and drones to monitor infrastructure projects on the ground. Last August, as government began investigations into anomalous flood control projects, we launched its Flood Control Management component, and soon, we will be expanding the coverage to schools, classrooms, and transport projects.
Climate Action
And we are going green! The Philippines has been implementing Climate Change Expenditure Tagging (CCET) for 10 years now, and for 2026, we will allocate 14.5 percent of the proposed National Budget to address climate change.
We are also embedding climate resilience and sustainability into the core of our PFM systems. A testament to this is the conduct of the 2024 Public Expenditure and Financial Accountability (PEFA) Assessments, which included, for the first time, an assessment of climate responsiveness and disaster-resilience and responsiveness of our PFM system.
Given the results of these assessments, we have adjusted our proposed FY 2026 National Budget and introduced a new general provision promoting sustainable practices in government operations. We likewise allotted the largest share of climate change expenditures to Sustainable Energy and Water Sufficiency. Finally, we established climate change and environmental standards as mandatory preconditions for the approval of PPP projects.
Open Governance
Next, on open governance. We publish key budget documents on the DBM website, along with citizen-friendly versions of the proposed and enacted budgets to broaden reach and understanding. These efforts have made the Philippines the most fiscally transparent country in Asia in the 2023 Open Budget Survey. And we are happy that both the Senate and the House of Representatives are now following DBM’s lead and taking meaningful steps to make the budget process fully transparent and participatory.
And I am proud to share that at the opening plenary of the 2025 OGP Global Summit in Spain, four outstanding commitments from the Philippines on anti-corruption, climate and environment, access to information, and civic space won the Open Gov Challenge Awards, a global call to action which aims to encourage ambition in ten areas of open government.
As chairperson of the Philippine Open Government Partnership (PH-OGP) and the Development Budget Coordination Committee (DBCC), we have expanded meaningful dialogue with stakeholders by holding the first-ever economic dialogue with civil society during the OpenGov Week last May. These dialogues, which we have recently brought to Cebu and Clark, and which we will bring to Cagayan de Oro next week, will help ensure that our fiscal policies remain inclusive and responsive to the needs of our people on the ground.
Another reform that we are championing is the Right to Information Act—a measure that will enshrine transparency as a cornerstone of governance.
As Chair of the PH-OGP, I have been actively pushing for the passage of a robust Right to Information law that will enshrine every Filipino’s constitutional right to access information. Finally, it has been officially identified as a priority legislative measure for the 20th Congress.
For our partners in the business community, this means easier access to reliable data and government policies.
Bureaucratic Efficiency
Finally, to enhance bureaucratic efficiency, we are reducing redundancies and streamlining government processes through the recently signed Government Optimization Act.
CLOSING
Moving forward, we seek to nurture future-ready generations to achieve the full potential of the nation. This means that by 2028, we hope to lift millions of Filipinos out of poverty, invest more in our very young and well-educated workforce, implement 207 infrastructure projects, and cut the country’s deficit. However, we recognize that we can only achieve this not just through a whole-of-government, but through a whole-of-nation approach, with our partners in ECCP and EU-ABC and all of you leading corporations in the business community playing a crucial role in this endeavor.
Indeed, we hope to see greater economic engagement between the EU and the Philippines. I hope you will continue to be our valuable partners, and I am confident that together, we can promote economic expansion and open a wide range of opportunities towards fulfilling our Agenda for Prosperity and the vision of a Bagong Pilipinas that we all aspire for.
Thank you very much.
Wabillahi Tawfiq Wal Hidaya, Wasalamu alaikum wa rahmatullahi wa Barakatuhu.
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