PH needs to explore non-traditional markets – Pernia
The government is calling for improved efforts to create a more competitive environment for industries as exports of Philippine products fell in June, the 15th consecutive month of decline.
June exports totaling $4.75 billion were $61 million or 11.4 percent less than the year-ago level. As a result, total exports in the first half of the year ($26.83 billion) were down by $2.17 billion (7.5 percent) from the year earlier.
Data released by the Philippine Statistics Authority (PSA) on Wednesday showed that nine of the 10 major commodity groups accounted mainly for the decrease. They were: other mineral products (-41.1 percent), machinery and transport equipment (-31.6 percent), other manufactures (-26.1 percent), chemicals (-25.7 percent), woodcrafts and furniture (-19.2 percent), ignition wiring set and other wiring sets used in vehicles, aircrafts and ships (-10.2 percent), electronic products (-5.1 percent), metal components (-2.2 percent), and coconut oil (-2.0 percent).
Shipment of the country’s top export item, electronic products, also declined. At $2.42 billion it was $129 million less than $2.55 billion in June 2015. Yet, it continued to rank as the top export, accounting for 51.1 percent of the total shipments. Semiconductors also shrunk by 8.7 percent to $1.71 billion from $1.88 billion.
“We must continue to improve our efforts in ensuring an enabling environment where industries can upgrade and improve their competitiveness,” Socioeconomic Planning Secretary Ernesto Pernia said in a statement.
He said that an example would be transforming the agriculture sector from traditional farming to a globally competitive agribusiness sector.
“This can be done by effectively linking the agriculture sector to the local and global industry supply chain,” said Pernia, who is also the director general of the National Economic and Development Authority (NEDA).
The NEDA also reported that export of manufactured goods declined by 9.5 percent to $4.1 billion in June 2016, a steeper fall than the 0.5 percent decline in May 2016.
On the other hand, it said export of petroleum products declined by its slowest pace of 10.6 percent since the start of the year. In part, this reflected price dynamics as export volume increased by 90.6 percent.
Meanwhile, the agency noted that exports to the country’s traditional markets, excluding Hong Kong and Taiwan, also dropped. Shipments to Hong Kong increased 3.2 percent and to Taiwan expanded 2.2 percent.
Exports to almost all Asian countries, except Vietnam and India, have improved but remained weak, it added.
Focus on non-traditional markets
Pernia pointed out that with the slow global economic recovery, the country should explore non-traditional markets in Europe and in the Association of Southeast Asian Nations region to counter weak demand in traditional markets.
“We should also ensure that the programmed spending on infrastructure projects, particularly those related to transportation and logistics, to support the country’s growing industries,” he noted.
Japan was the top market, accounting for 20.6 percent of outbound shipments worth $980.57 million. But it was was 23.2 percent from $1.27 billion a year ago.
The United States stood second with a 15.6 percent share or $741 million. It was followed by Hong Kong, China and Singapore.