MANILA — The Philippine Chamber of Commerce and Industry (PCCI) is calling on the government to step in and help businesses cope with shrinking profit margins driven by rising operating costs and a weaker peso, warning that challenging business conditions are likely to persist into 2027.

"For Philippine businesses now, the margins are getting thinner and thinner, because they are absorbing the high costs," PCCI President Ferdinand A. Ferrer told reporters last week.

According to Mr. Ferrer, who also serves as chairman and chief executive officer of the EMS Group of Companies, the peso's weakness combined with higher food, fuel, and transportation costs has placed additional pressure on local companies. A weaker peso makes imported goods and inputs more expensive in peso terms, so the currency's slide feeds directly into those cost lines. He further flagged the potential impact of El Niño — a recurring climate pattern often associated with drier conditions — on electricity costs, a concern he said falls especially hard on manufacturers.

"In our factory, for example, we're preparing for rising electricity cost and power cost to maintain a temperature of that where people can work," he said.

The business group expects conditions to remain difficult through 2027, underscoring its push for government measures to help companies manage escalating expenses.

"Of course, all these industries are doing their own to keep themselves afloat or competitive," Mr. Ferrer said. "But now it really needs intervention from National Government, whether it's through the currency, power, everything."

A stronger peso, he noted, would help import-dependent businesses bring costs under control, and he described an exchange rate of around P58 against the US dollar as favorable for local firms. "We have to bring the peso down to a more stable currency exchange maybe. Hopefully so far, but around P58 would be good for us," he said.

The peso closed slightly weaker at P63.055 against the dollar on Friday. That close leaves the currency roughly five pesos above the level Mr. Ferrer described as favorable, a gap that measures the distance between current conditions and the relief local firms are seeking.

Despite the mounting cost pressures, Mr. Ferrer said businesses remain upbeat about consumer spending during the Christmas season. "No matter what the challenges [are,] we will always celebrate Christmas positively," he said. "After that, reality will strike back again at any Filipino or entrepreneur."

Beyond near-term government support, Mr. Ferrer urged a longer-term effort to strengthen domestic supply chains and reduce the country's dependence on imported raw materials. "A longer-term solution there is really talking seriously about our supply chain. Let's look at the raw materials that can be developed here to supply our industries and our needs," he said. Taken together, the near-term asks on currency and power and the longer-term supply-chain pitch outline the specific levers Mr. Ferrer pointed to as Philippine businesses navigate a cost squeeze the group expects to run through 2027.

Reporting by Beatriz Marie D. Cruz, originally published by BusinessWorld.