Metro Manila (CNN Philippines, February 11) — A last-minute spike in exports and a steady drop in imported raw materials led to a narrower trade gap in 2019, data from the Philippine Statistics Authority showed.
Philippine manufacturers enjoyed a 21.4 percent lift in export items in December, the fastest growth in over two years. The outbound products were cumulatively worth $5.74 billion.
The surge is led by a fivefold increase in cathodes of refined copper, followed by a 34.9 percent jump in exports of fresh bananas. Gold also enjoyed a 30.2 percent lift, while supply of electronic products — which account for nearly 60 percent of shipments to the global market — rose by a fourth.
On the other hand, metal components saw export volumes slide by almost 18 percent, the PSA said. The United States was the biggest receiver of Philippine goods, followed by Hong Kong, China, Japan, and Singapore.
Meanwhile, imports of raw materials and intermediate goods marked the eighth straight month of decline, as supply slipped by 7.6 percent to settle at $8.22 billion.
Shipments of iron and steel sourced abroad slipped by 38 percent, followed by a 31 percent drop in cereal products. Industrial machinery, plastics, other food and live animals, electronic products, and transport equipment all suffered lower inbound shipments during the period.
The PSA said imports from China accounted for a fourth of the sum, followed by Japan, South Korea, and the US.
December shipments led to $177.7 billion in total external trade in 2019, with a $37-billion gap as imports continued to outweigh export receipts. Exports actually picked up by 1.5 percent last year, versus a 4.8 percent contraction in imports.
Dimmer 2020
Demand for Philippine products likely grew as new orders picked up ahead of a phase one deal between the United States and China’s long-standing tensions, ING Bank Senior Economist Nicholas Antonio Mapa said. However, this rally could be short-lived.
Mapa said 2020 could be a “more trying scenario” as China’s economy slows down. “Given China’s prominence in the global supply chain, we can expect external trade to hit a snag with global growth expected to decelerate in the coming months,” he said in a market commentary sent to reporters.
Security Bank Chief Economist Robert Dan Roces said separately that imports may be revived this year as more infrastructure projects are rolled out, while electronics factories may enjoy increased orders.
Semiconductor and Electronics Industries in the Philippines, Inc. President Dan Lachica said last week that factories of electronic parts have been hit hardest by lockdowns and shipping disruptions due to the novel coronavirus outbreak. He said about $40 billion worth of exports are at risk as trade with China is cut off by travel restrictions meant to contain the virus.
