MANILA, October 27, 2026 — The Philippines reached upper-middle-income status in 2025 — a hard-earned milestone. Sustaining progress, and creating more and better jobs, will depend on the country’s cities and municipalities working together to create connected regional economic corridors, finds a new World Bank report released today.
From Cities to Corridors: Unlocking the Philippines’ Urban Growth Potential draws on a detailed analysis of all 1,642 Philippine cities and municipalities to map where growth potential is strongest, where investment gaps are deepest, and what reforms are needed to integrate local economies into productive regional corridors. The report is a diagnostic intended to help inform the government’s reform agenda.
The Philippines has real and widely distributed urban potential, from Luzon’s major urban centers to the growing cities of the Visayas and Mindanao. But geographic barriers, coordination challenges, and gaps in delivery capacity continue to limit how fully cities connect to their surrounding areas and to each other. Closing that gap matters for jobs: World Bank evidence shows that municipalities within 100 kilometers of a roll-on/roll-off port saw a 12 percent increase in firms and wage jobs.
“The Philippines has the cities, the people, and increasingly the resources to power the next phase of its growth,” said Zafer Mustafaoğlu, World Bank Division Director for the Philippines, Malaysia and Brunei. “Strengthening the economic integration between cities and their surrounding areas — especially in lagging regions — is how the Philippines ensures that growth is not only faster, but more inclusive. Connected corridors are the mechanism through which urban prosperity reaches the communities and families that need it most.”
The report identifies 26 clusters of neighboring cities and municipalities, covering 112 urban local governments. Each cluster includes an urban center and nearby urban areas that could drive regional growth. Connecting these areas to smaller towns, ports, and production zones would expand labor and product markets and boost productivity beyond what any city could achieve alone.
The report suggests sequenced actions to help turn cities and municipalities into productive regional corridors with benefits that reach the most vulnerable communities: align national planning and fiscal frameworks with the functional economic realities of Philippine cities; enable local governments to prepare and deliver investments effectively; and strengthen infrastructure and institutional incentives.
- The Philippines has the cities, the people, and increasingly the resources to power the next phase of its growth. Strengthening the economic integration between cities and their surrounding areas — especially in lagging regions — is how the Philippines ensures that growth is not only faster, but more inclusive. Connected corridors are the mechanism through which urban prosperity reaches the communities and families that need it most.”
