Philippine merchandise exports fell for a ninth consecutive month in December 2015, capping a full-year contraction blamed on weak global demand.
December exports declined by 3 percent to $4.660 billion from a year earlier, bringing the 2015 tally to $58.648 billion, down 5.6 percent from the previous year.
The National Economic and Development Authority (NEDA) and an analyst both blamed a still-challenged global economy for the result.
Six of the country’s top 10 exported goods posted declines: apparel and clothing accessories (-42.7 percent), chemicals (-39.2 percent), other manufactures (-23.8 percent), metal components (-16.5 percent), and electronic equipment and parts (-5.3 percent).
Electronic products, the country’s biggest export with a 54.3-percent share of the total, increased by 6.4 percent to $2.529 billion. Semiconductors, however, fell by 0.8 percent to $1.699 billion.
Japan was the Philippines’ top market in December, accounting for 20.2 percent of outbound shipments or $939.17 million. This, however, was down 7.7 percent from a year ago.
The United States came in second with a 15 percent share or $697.33 million. It was followed by Hong Kong, China and Singapore.
Trading partners’ slowdown
Acting Socioeconomic Planning Secretary Emmanuel Esguerra said a slowdown in the country’s major markets, particularly China, had weighed on export revenues.
“Advanced and emerging economies continue to face difficulties. In particular, the slowdown in China due to ongoing structural transformation, as well as contractionary fiscal policies in oil-exporting countries as they adjust to declining oil revenues, pose risks to the Philippine economy this year,” he said.
Esguerra, the NEDA director general, said the challenge for the Philippines involved expanding export destinations and diversifying product offerings.
Rahul Bajoria, economist at United Kingdom-based investment bank Barclays, said the weakness in Philippine exports remained centered on non-electronic shipments, which fell by 12.1 percent in December.
“Exports declined largely owing to weakness in shipments of food, textiles and furniture. In terms of geography, shipments to Asean (Association of Southeast Asian Nations) countries and China remain weak,” he said.
On a positive note, the NEDA said major trading partners such as the United States, Japan and the eurozone were expected to post a slight recovery this year.
Esguerra said the Philippines should take advantage of the Asean Economic Community when this takes full effect this year.
“Expanding market opportunities in emerging export markets such as India and Mexico can boost the country’s merchandise exports, as they have been increasing their demand for consumer products,” he said.
He added that the country should remain committed to the implementation of the Manufacturing Restructuring Program (MRP) to complement market and product diversification efforts.
“Implementing the MRP will rebuild the domestic production base and improve competitiveness through innovation,” Esguerra said.
“Given the high multiplier effects and potential for employment generation, the revival of the manufacturing sector is expected to spur domestic employment and investments in the country,” he added.