At $4.187B in Jan, down from $4.357B in previous year on sluggish global demand
PHILIPPINE merchandise exports fell 3.9 percent to $4.187 billion in January from $4.357 billion a year earlier, dragged by declines in five of the 10 major commodities, according to data from the Philippine Statistics Authority (PSA) on Thursday.
The National Economic and Development Authority (NEDA) and an analyst pointed out that the sluggish global demand continues to impact the country’s outbound shipments.
The five major exports that posted declines were apparel and clothing accessories at 46.2 percent, chemicals (34.6 percent), machinery and transport equipment (22.6 percent), metal components (14.2 percent), and other manufactured goods (5.5 percent).
But electronic products, the country’s biggest export with a 51.1-percent share of the total, increased 5 percent to $2.124 billion from $2.04 billion for the same period, while semiconductors also rose 5.1 percent to $1.476 billion from $1.404 billion.
Japan was the Philippines’ top market in January, accounting for 22.7 percent of outbound shipments worth $950.52 million. This was up 7.7 percent from $882.61 million a year ago.
The United States came in second with a 16.7 percent share or $698.85 million. It was followed by Hong Kong, China and Singapore.
Weak regional performance
NEDA said most of the major East and Southeast Asian trade-oriented economies registered negative growth in January 2016, reflecting sluggish global demand, with Vietnam registering the least decline, and Singapore, the steepest decline.
Socioeconomic Planning Secretary Emmanuel Esguerra said this year is expected to be a challenging one for the export sector as the global economy faces sluggish economic recovery and uneven growth.
“We see global trade growth remaining at a low level as the world copes with soft demand and lower commodity prices,” he said.
Jeff Ng, economist at banking giant Standard Chartered Bank, said the weak January exports still mean that external demand remains sluggish.
Overall, he said, exports to Asia remained flat or negative, while exports to the developed markets in the US and Europe did slightly better.
“We don’t expect any improvement at least until the second half of this year,” Ng added.
Explaining the performance of commodity groups, NEDA said the export of manufactured goods dropped by 2.2 percent, falling to $3.659 billion from $3.739 billion in January 2015.
“The fall in exports of manufactured products mirrors the general weakness of the global manufacturing sector. However, worth noting is the 5-percent increase in the exports of electronic products that registered its eighth consecutive month of positive growth in January,” Esguerra, the NEDA director general, said.
Exports of agro-based products declined by 7.6 percent to $289.12 million from $312.96 million, dragged by lower revenues from coconut products and fish products.
“We attribute this to the continued tightness in supply due to persistent dry weather. Also, lower export revenues for fish products can be partly traced to the lower supply of fish in Region XII,” said Esguerra.
Lastly, outbound sales of mineral products also dropped by 27.8 percent to $145.29 million from $201.17 million, while exports value of petroleum products declined by 17.8 percent to $9.98 million from $12.14 million due to the persistent low oil price environment, the agency said.
The NEDA chief said market and product concentration remain as challenges in increasing Philippine trade, and that trading with other Association of Southeast Asian economies is still limited despite recently growing regional integration.
“The government and private sector should take advantage of the opportunities offered by economic groupings, trade agreements and the structural transformation of other economies. We should engage more actively in information gathering and dissemination, market intelligence, and capacity building of our exporters,” said Esguerra.