The Philippines hopes to become an upper middle-income country by 2025. This target was reiterated during the Philippine Economic Briefing held in Manila four days ago.
But what does it mean to become an upper middle-income country, or UMIC?
A UMIC, according to the World Bank (WB), is a country that has a gross national income (GNI) per capita of $4,466 to $13,845 per year for the current fiscal year 2024.
GNI per capita, meanwhile, refers to the total value of the country’s income divided by its population.
The Washington-based multilateral lender classifies the Philippines as a lower middle-income country with a GNI per capita of $3,950 in 2022 — a status we entered since the 1970s and has remained so up until the present.
President Ferdinand R. Marcos, Jr. earlier vowed to elevate the Philippines to UMIC status by 2024 during his first State of the Nation Address.
The National Economic and Development Authority (NEDA), however, revised this target and moved it to 2025.
In fairness to the current administration, the UMIC goal is originally targeted in 2022 by the previous administration. This, however, was derailed by the extraordinary challenges brought by the COVID-19 pandemic.
Can we achieve this target by 2025?
Yes, according to our government economists, but before we celebrate and open the bottle of champagne, we have to achieve at least six percent economic growth in the next three quarters of the year, NEDA added.
I share the optimism of the country’s Economic Team. However, attaining the UMIC status should not be the be-all and end-all.
We should not be fixated with reaching a certain WB threshold classification. More important and more pressing is building an inclusive, equitable and sustainable economy, where growth is evenly distributed.
Inclusive, equitable and sustainable growth from a geographical standpoint remains a big challenge. Greater Metro Manila is not the Philippines, and the Philippines is not the Greater Metro Manila.
We have to strongly push to diversify growth sources to ensure the fruits of our economic expansion are enjoyed by the greatest number.
Only then we can stand tall and proud to say that we are in the new Philippines.
—
Dennis Ting is a former director at the Department of Budget and Management.
