(CNN Philippines) — Total imported goods last March dropped 6.8% to about $5.1 billion, compared to $5.5 billion registered during the same month in 2014, according to figures from the Philippine Statistics Authority.
This contraction stands in contrast to the previous month’s 10.2% rebound, and a 10.8% annual growth posted in March last year. The import sector has been contracting since November 2014, with February this year as the only exception.
The PSA said that the decline was primarily driven by the negative performance of two of the month’s top ten commodities, namely Mineral Fuels, Lubricants and Related Materials (-47.3% ); and Plastics in Primary and Non-Primary Forms (-16.9%).
In a separate statement, the National Economic and Development Authority (NEDA) said that the extremely reduced value of goods in the former category were caused by lower crude oil prices and a lower demand for non-oil mineral products.
“The low oil-price condition remains favorable to the current balance of trade, particularly for trade-in-goods of the country as global oil prices continue to hover way below US$100 per barrel at US$51.6 for the first quarter of 2015,” said NEDA chief Arsenio M. Balisacan.
“The low price of oil prompted an increase in the overall volume of imported crude by 47.8 percent. It is expected that the increase in energy demand during the summer season will further drive imports of petroleum products,” he added.
Approximately 40.9% of total imports were raw materials and intermediate goods valued at $2.089 billion. The figure is a 1.1% contraction from last year’s $2.113 billion.
Capital goods — those used for the production of more goods and services — accounted for 30% of the share, with a 16.6% rise to $1.536 billion from last year’s $1.317 billion.
Consumer goods ranked third with a 14.7% share valued at $752.75 million. The figure is a slight 2.8% increase from March 2014’s $732 million.
“The growth in the imports of major commodities, particularly capital goods and consumer durables, shows that the confidence in the economy continues to be strong and bodes well for growth this year and next,” said Balisacan.
With a 12% share, China was the largest source of goods shipped to the country, followed by the U.S. at 10.7%. Japan ranked third in imports, having contributed 8.7% of March 2015’s import bill.
NEDA said that most economies in East and Southeast Asia, except for Vietnam, logged a decline in merchandise imports last March. “The reduced value of imports primarily from PR [People’s Republic of] China, South Korea and SIngapore contributed to a drag on imports during the period.”
