AMRO Director/CEO Yasuto Watanabe delivered a pre-recorded speech at The Manila Times Economic Forum on February 18, 2026.
Good morning, ladies and gentlemen. Thank you for the invitation to this prestigious annual economic forum hosted by the Manila Times.
I’m Yasuto Watanabe, Director and CEO of AMRO.
I’m pleased to join you virtually, especially as we discuss strengthening ASEAN partnership and the Philippine’s chairmanship this year.
Today, I will share a few reflections on
“Advancing ASEAN Economic and Financial Cooperation: AMRO at 10 and the Philippines’ Growth Beyond 2026.”
ASEAN has proven resilient.
The region recovered robustly from the pandemic and has maintained solid growth despite strong headwinds.
Growth reached 4.8% last year, and momentum is expected to continue this year.
This performance is notable given global trade tensions. It reflects less severe tariff outcomes, robust tech exports, strong foreign investment, and timely policy support.
Looking ahead, ASEAN remains one of the world’s most important growth engines.
Growth for the region is expected to outpace global growth, anchored by strong domestic demand, an expanding middle-class, and deeper regional integration.
At this pace, ASEAN is likely to contribute more than 10% of global growth for the rest of this decade.
However, momentum is slowing.
To realize its full potential, ASEAN must confront some major challenges.
First, the global environment is becoming more complex.
Rising protectionism threatens to reverse decades of progress. ASEAN must remain firmly committed to a rules-based multilateral trading system.
Second, global value chains are fragmenting and being reconfigured by geopolitical forces. ASEAN must position itself not just as a manufacturing hub, but as a strategic node in global value chains to drive future growth and resilience.
Third, structural challenges are intensifying. Population aging and climate change demand urgent and innovative solutions.
ASEAN must turn its “demographic dividend” into a “longevity dividend”—by rethinking labor markets, skills, and social systems.
At the same time, advanced technologies must be leveraged to enhance productivity and deliver not only growth—but quality growth.
Many of these challenges transcend national borders.
In a fragmenting world, ASEAN—and the broader ASEAN+3—must be a stabilizing and unifying anchor.
Let me now turn to the Philippines.
Despite global trade tensions and geopolitical uncertainty, growth has remained steady.
Economic growth is projected to rebound to around 5.3% in 2026, from 4.4% in 2025.
This is supported by stronger public investment, firmer domestic demand, and improving exports.
Labor market conditions remain favorable.
Unemployment is low—around 4%, well below pre-pandemic levels.
Inflation is expected to rise gradually to about 3.2% in 2026, from 1.7% in 2025, remaining within the BSP’s target range.
This reflects stronger demand in a stable macro environment—and provides welcome policy space.
While external risks remain—from more protectionist trade policies to slower growth in key partners and tighter global financial conditions—the Philippines’ macroeconomic fundamentals are sound.
The bigger challenge lies beyond the near term: how to sustain high growth over decades.
This brings us to the long-term picture.
The Philippines is approaching upper-middle-income status—a milestone likely within reach in the coming years.
But the ambition goes further.
Achieving high-income status by 2050 will require more than cyclical recovery.
Gross National Income per capita would need to triple over the next 25 years.
That implies sustaining average growth of around 4.5% annually.
This is achievable, but only with sustained productivity gains, structural transformation, and strong policy discipline.
The key question is how to deliver this in a more uncertain global environment shaped by rapid technological change.
The growth strategy must therefore evolve.
That means prioritizing sectors with clear comparative advantages.
Upgrading services and manufacturing toward higher value-added activities.
Strengthening digital and physical connectivity.
And investing decisively in skills and workforce upgrading.
Crowding in private investment will be critical.
Faster infrastructure delivery, fewer regulatory frictions, and better access to long-term financing will determine the next phase of inclusive and durable growth.
This is where regional cooperation becomes essential.
The Philippines’ ASEAN chairmanship comes at a pivotal moment.
The region faces fragmentation, technological disruption, and climate risks—but also historic opportunities.
As Chair, the Philippines can help steer ASEAN toward deeper integration, strong policy coordination, and a more future-ready regional economy.
This year also marks AMRO’s first decade as an international organization (IO).
Over the past 10 years, AMRO has evolved from a small surveillance institution into an independent, credible, and professional IO—supporting macroeconomic monitoring, early warning, and policy dialogue across ASEAN+3.
Looking ahead, AMRO’s role will continue to evolve.
We will strengthen analysis.
Upgrade our frameworks and tools.
Support capacity building.
And help members navigate shocks—whether financial, geopolitical, or climate-related.
Together, the Philippines’ leadership as ASEAN Chair and AMRO’s regional mandate reinforce the same message:
Regional cooperation is not optional—it is essential.
By working together, ASEAN and ASEAN+3 can remain resilient, relevant, and ready for the future.