The Philippines has crossed a major economic milestone after the World Bank upgraded it to upper-middle income status, a move expected to improve investor confidence, strengthen the country’s credit standing, and open the door to bigger private investments despite a gradual reduction in concessional foreign aid.

The World Bank’s latest income assessment showed the Philippines’ gross national income (GNI) per capita reached $4,850 in 2025, surpassing the $4,636 threshold required for upper-middle income economies. 

The Department of Economy, Planning, and Development (DEPDev) said the upgrade reflects years of sustained economic growth, prudent macroeconomic management, and structural reforms.

Zafer Mustafaoğlu, World Bank's Division Director for the Philippines, Malaysia, and Brunei, described the reclassification as recognition of the country’s long-term economic progress.

“This achievement is built on years of sustained growth, strong reforms, and hard work of the Filipino people.”

The country’s elevation was supported by average gross domestic product (GDP) growth of 5.8 percent from 2021 to 2025. Broad-based expansion across industries lifted GNI per capita by 8.5 percent in 2025, enabling the Philippines to move from the lower-middle to the upper-middle income category.

DEPDev Secretary Arsenio M. Balisacan said the new classification demonstrates the resilience of the Philippine economy despite global and domestic challenges.

“This confirms the resilience of the Philippine economy,” Balisacan said. “Despite global and domestic shocks, we have relentlessly pursued inclusive growth, strengthened fundamentals, and remained on track with our development agenda.”

Balisacan said the World Bank’s recognition is expected to reinforce the country’s investment appeal, improve access to financing, and attract higher-quality investments that create better-paying jobs for Filipinos.

While the Philippines may gradually receive less concessional official development assistance as its income level rises, he said stronger economic fundamentals and broader access to private capital are expected to offset those adjustments.

“We welcome this recognition of our progress and we commit to deepen reforms to sustain our economic development,” Balisacan said.

He also credited overseas Filipino workers for helping raise the country’s national income through remittances.

“Our OFWs have played an important role in reaching this milestone. At the same time, our long-term goal is to create more high-quality jobs at home so overseas employment becomes a choice, not a necessity.”

Despite the milestone, Balisacan emphasized that the government’s focus remains on making growth more inclusive.

“We acknowledge that income disparities persist, and many continue to face economic difficulties. Our priority is to ensure that growth becomes more inclusive, and that its benefits reach all Filipinos,” Balisacan said.

The upgrade comes as the Philippines prepares to chair ASEAN in 2026, providing another opportunity to showcase the country’s stronger economic standing while attracting investments that support long-term development and regional partnerships.