Economic hardship becomes politically dangerous when people begin to believe that government no longer hears them, or cares enough to act.
On Oct. 17, some 550,000 people took to the streets across France. What began with students protesting teacher shortages, overcrowded classrooms, and deteriorating school facilities grew into a broader expression of public frustration over the cost of living, strained public services, and government spending priorities. The demonstrations were a reminder that discontent rarely remains confined to the issue that first brings people together.
France is not the Philippines. Our institutions, political traditions, and economic circumstances are vastly different. Yet the underlying lesson is universal: people can endure considerable hardship when they believe that their sacrifices are necessary, fairly shared, and likely to lead to something better. Their patience becomes thinner, more fragile when they see rising costs, diminishing opportunities, and persistent allegations of wrongdoing while those in power appear preoccupied with political survival.
FRANCE, NOT A PREDICTION BUT A WARNING
This is why the French experience deserves our attention, not as a prediction of what will happen here, but as a warning of what can happen when economic anxieties and political distrust converge and reinforce each other.
The Philippine economy is entering a difficult period. September inflation accelerated to 7.2% from 6.1% in August, placing additional pressure on households already struggling with food, transport, electricity, and other necessities. For families living on fixed or irregular incomes, the effect is profound and immediate. A wage increase that looks meaningful on paper can quickly lose its value at the market or the fuel station.
Growth, meanwhile, has slowed sharply. The economy expanded by only 2.3% in the second quarter of 2026, while household consumption grew by a measly 2.8%. These figures point to an economy whose ability to generate broadly shared prosperity should not be taken for granted. The International Monetary Fund has also lowered its growth expectations for the Philippines, projecting expansion of 3.4% in 2026 before a recovery to 5.1% in 2027.
PEOPLE’S CONCERN AND LOSS OF CONFIDENCE
The concern is not simply that growth is slower or inflation higher. It is that these pressures are being felt by people who may already be losing confidence in the institutions expected to protect the public interest.
The Bangko Sentral ng Pilipinas (BSP) faces a particularly delicate task. Having raised its policy rate by 25 basis points to 5% on Oct. 14, the Monetary Board meets again on Oct. 22 amid expectations of another increase. A further tightening would seek to contain inflationary pressures and prevent them from becoming entrenched. While we expect as of this writing a 50 basis point increase, we maintain the view that monetary policy cannot produce more rice, repair supply chains, lower transport costs by administrative decree, or ensure that public infrastructure is delivered efficiently.
The challenge is to bring inflation under control without imposing unnecessary costs on investment, employment, and household spending. Just as important, monetary policy must remain credible and independent. The public needs to understand why the BSP acts, what its actions can achieve, and what lies beyond its reach. Fiscal and supply-side measures must complement monetary policy, particularly where food availability and essential services are concerned.
No central bank, however competent, can compensate indefinitely for weaknesses elsewhere in government.
This brings us to the continuing controversy over flood-control projects. Allegations of irregularities, including those now under investigation, have become more than a matter of accounting or procurement. They raise a basic question about the use of public money: are taxpayers receiving the protection and infrastructure for which they pay?
CONSEQUENCES NOT EVENLY SHARED
The issue is especially painful because the consequences of inadequate flood control are borne disproportionately by ordinary Filipinos. Families lose homes and possessions, workers lose income, businesses close, and children miss school. If public funds intended to protect vulnerable communities are misused, the damage is both material and moral.
Allegations must, of course, be established through proper investigation and due process. Accountability cannot mean presuming guilt. But neither should due process become an excuse for indefinite delay. Credible investigations, transparent procurement, timely prosecution where warranted, and the recovery of public funds are essential not only to justice but also to public confidence.
People are more willing to accept economic sacrifice when they see that public officials are held to the same standards expected of everyone else. They become less willing when they suspect that the burden is theirs while the benefits accrue to the privileged. This is a Philippine reality very few can deny.
POLITICS ANOTHER LAYER OF UNCERTAINTY
Political developments add another layer of uncertainty. The controversy surrounding Vice-President Sara Duterte’s impeachment, including the recent narrowing of the charges to the allegation concerning unexplained wealth, underscores how intensely political the country has become. With the 2028 presidential election approaching, political actors have strong incentives to frame economic and governance issues in ways that advance their own narrow interests.
True, electoral competition is a necessary feature of democracy. But the danger is that the pursuit of political advantage can crowd out the urgent work of governing. Inflation does not wait for campaign season to end. Families cannot postpone their grocery bills until political disputes are settled. Nor can communities afford to wait for the next election before demanding that public infrastructure work as intended.
France offers a sobering reminder of how quickly a specific grievance can become a wider indictment of government. Its demonstrations do not establish that the Philippines is destined for similar unrest. They do show, however, that public dissatisfaction can spread when different groups begin to see their problems as expressions of the same underlying failure.
LOSING TIME FOR REFORMS THAT CANNOT BE POSTPONED
There is another danger in allowing political disputes to consume the government’s attention: the country may lose precious time for reforms it can no longer afford to postpone. Delayed investments, weak execution, and reluctance to confront structural problems can constrain productivity, discourage private capital, and deny Filipinos the jobs and opportunities that stronger growth should deliver. The cost is not always immediately visible, but it accumulates in foregone income, deteriorating public services, and a widening gap between what the economy could achieve and what people actually experience.
Impeachment proceedings must be resolved fairly and in accordance with the Constitution. But neither they nor the approaching 2028 elections should become excuses for the government’s inertia. The country needs a government that can defend accountability while continuing to govern: modernizing public administration, improving the quality of public spending, strengthening competition, addressing infrastructure and energy constraints, investing in education and skills, and ensuring that growth translates into better lives. Political legitimacy is strengthened not only by winning elections or surviving controversies, but by demonstrating the capacity to solve problems.
If these responsibilities are neglected, the danger is larger than a disappointing growth rate or another bout of public anger. It is the gradual erosion of confidence that sound democratic institutions can deliver meaningful change.
WAITING FOR STREETS ERUPTING WITH ANGER?
We should not wait therefore for angry streets before recognizing the warning signs.
The appropriate response is neither alarmist nor complacent. It is practical, visible, and sustained action. Immediately, we need to protect vulnerable households through well-targeted assistance and improve food supply and distribution. It is equally imperative that we encourage investment that creates productive jobs. In politics, we must accelerate credible investigations into alleged corruption and impeachment proceeding against public officials accused of unexplained wealth. In public finance, there is a need to demonstrate that public resources are being spent for public benefit.
Government must also communicate honestly. It should not promise that every problem can be solved immediately, but it must show that it understands the burdens people carry and has a credible plan to ease them. Trust is rebuilt less through declarations than through results that people can see in their daily lives.
Ultimately, economic stability is not measured by inflation and growth figures alone. It also depends on whether people believe that the system works for them, that opportunity remains within reach, and that those entrusted with public office are acting in the public interest.
The Philippines still has the opportunity to address its difficulties before they harden into a deeper crisis of confidence. That opportunity should not be squandered in political maneuvering or delayed by the familiar cycle of controversy, investigation, and absence of resolution.
The question is not whether the Philippines can afford to act. It is whether we can afford to wait.
God forbid that we should learn this lesson only when our own streets erupt with anger.
Diwa C. Guinigundo is the former deputy governor for the Monetary and Economics Sector, the Bangko Sentral ng Pilipinas (BSP). He served the BSP for 41 years. In 2001-2003, he was alternate executive director at the International Monetary Fund in Washington, DC. He is the senior pastor of the Fullness of Christ International Ministries in Mandaluyong.