Can domestic savings cover the country’s increasing investment needs? – BusinessWorld Online
In the second quarter of 2025, the country’s savings rate — defined as gross domestic savings as a percentage of gross domestic product (GDP) — grew 10.9%, reaching P760 billion. Meanwhile, the investment rate was 26.1% of GDP, or P1.82 trillion, resulting in a P1.06-trillion gap. The savings-investment gap (S-I) gap — the difference between gross domestic savings and gross capital formation — shows a country’s ability to finance its overall investment needs. An S-I deficit occurs when a country’s investment expenditures exceed its savings, resulting for a country to borrow money to fund the gap.
