Year-to-date down 0.2%
PHILIPPINE exports gained momentum to rise 2.06 percent in March after three consecutive months of contractions, with growth largely driven by coconut oil, machinery and transport equipment, chemicals and mineral products, official figures show.
The increase in March marks a reversal of previous months’ declines such as 2.96 percent in February, (revised) 0.02-percent in January and 3.18 percent in December 2014.
However, the rebound fell far short of the 12.13 percent jump in exports recorded in March of the previous year.
Figures from the Philippine Statistics Authority (PSA) show March 2015 exports rose to $5.377 billion from $5.268 billion a year earlier on the back of increases posted by seven major commodities, which apart from those already mentioned, also include metal components, articles of apparel and clothing accessories, and electronic products.
Cumulative exports in January to March this year dropped 0.2 percent to $14.247 billion from $14.277 billion in the comparable period last year.
NEDA sees return to positive
The National Economic and Development Authority (NEDA) welcomed the country’s strong exports performance back into positive territory for March from declines recorded since December last year.
Among selected economies in the East and Southeast Asian region, only the Philippines and Vietnam registered positive export growth in the month, while the others posted negative growth, NEDA said in a statement.
“Increased sales in manufactures and mineral products kept growth afloat in March,
counteracting the declines in total agro-based and petroleum products,” said Socioeconomic Planning Secretary Arsenio Balisacan.
In particular, sales of manufactured goods, which accounted for 84.4 percent of total exports, rose 2.8 percent, mainly supported by increased revenues from electronic products, machinery and transport equipment, chemicals and garments, NEDA said.
Exports of mineral products surged 20.8 percent to $335.2 million from the year-earlier $277.5 million, propelled by higher earnings from the exports of copper metal, gold and other mineral products, it said.
Electronic products’ total receipts increased 4.5 percent to $2.332 billion from $2.232 billion in the comparative period.
“Moving ahead, growth in exports will likely be driven by favorable economic environment in the United States, and in part supported by cheap oil prices and accommodative monetary policy in the European Union,” Balisacan, who is also the NEDA director-general, said.
Despite the recovery in March, the NEDA chief stressed the need to actively pursue and continue current initiatives at strengthening the capacity of various industries to be resilient against calamities and extreme weather conditions.
“Over the near term, production disruptions from unpredictable weather patterns remain one of the biggest risks in attaining the country’s export targets, particularly in the agro-based products,” he said.
Balisacan also clarified that although agro-based commodities only account for less than 10 percent of the country’s export revenues, the products are significant in terms of the segment’s contribution to employment, as well as its linkages with industry and services.
“Over the medium term, infrastructure development as a means to support agriculture production must be prioritized in order to improve the competitiveness of the sector,” he added.
Easing port congestion
UK-based investment bank Barclays traced the rebound in exports to the easing of port congestion.
“The normalization of port operations in February following congestion in prior months likely helped support a stronger recovery in March,” Bill Diviney, economist at Barclays, said.
The analyst explained that exports rebounded more strongly than expected in March, with total shipment up 7.4 percent month-on-month on a seasonally adjusted basis.
“This followed a more modest recovery of 4.6 percent month-on-month on a seasonally adjusted basis in February, though exports still remain some 12.1 percent below the recent peak reached in November–pointing to further room for recovery from here,” he added, referring to the 19.65 percent growth recorded in November.
Japan remained the country’s top export market for the month with a 20.8 percent share of total exports amounting to $1.118 billion. The value, however, reflects a 15.6 percent drop from the year-ago level.
The United States came in second with a 16.4 percent share, amounting to $879.54 million. It was followed by China, Hong Kong and Singapore.