THE country’s trade deficit narrowed to $2.47 billion in June from $3.55 billion in the same month last year and $3.29 billion in May as exports continue to outpace imports for the third consecutive month, the Philippine Statistics Authority (PSA) reported on Wednesday.
The state-run statistics agency said total export sales during the month grew by 1.5 percent to $6.01 billion from $5.92 billion in June 2018.
It attributed the growth to increases in the export sales of cathodes and section of cathodes; of refined copper (41.7 percent); fresh bananas (24.4 percent); ignition wiring set and other wiring sets used in vehicles, including aircraft and ships (17.6 percent); gold (10.1 percent); electronic products (4.3 percent); machinery and transport equipment (3.0 percent); and other mineral products (1.1 percent).
Total value of imported goods, meanwhile, contracted by 10.4 percent to $8.48 billion in June from $9.47 billion year-on-year.
PSA attributed the decline to decrements in nine major import commodities. These are iron and steel (-40.3 percent); cereals and cereal preparations (-29.4 percent); industrial machinery and equipment (-20.7 percent); plastic in primary and non-primary forms (-16.4 percent); transport equipment (-12.6 percent); telecommunication equipment and electrical machinery (-12.2 percent); mineral fuels, lubricants and related materials (-7.0 percent); other food and live animals (-6.7 percent); and miscellaneous manufactured articles (-0.1 percent).
Total external trade in goods in June decreased by 5.8 percent to $14.49 billion from $15.39 billion a year ago.
In a statement on Wednesday, the National Economic and Development Authority (NEDA) said the government must exert all efforts in boosting domestic demand and exports’ competitiveness to improve the country’s trade performance, as global growth would likely to remain sluggish for the rest of the year.
Socioeconomic Planning Secretary Ernesto M. Pernia partly attributed the external trade slowdown to ongoing trade disputes, Brexit-related uncertainties and rising geopolitical tensions.
“Despite the challenging external environment, the Philippines has shown resilience in its trade performance. The Philippines is among the countries in Asia with positive export growth,” he said.
“The government must continue promoting the competitiveness of the Philippine exports by implementing policies and laws, such as the Philippine Innovation Act. This will encourage innovation that will reduce the cost of production and elevate the quality of Philippine products to meet international standards,” Pernia added.
The NEDA chief also said that, because of pessimistic global trade prospects, it was necessary to diversify markets and boost domestic demand to compensate for the weakness of external trade.
He also reiterated his agency’s call to diversify products and markets by establishing new trade relations and improving existing ones with strategic partners.
“In light of the current trade spat between [South] Korea and Japan, we need to complete the negotiations for the free-trade agreement with South Korea and review the decades-old Philippines-Japan Economic Partnership Agreement to further expand the country’s exports in both markets,” Pernia said.
Also, “the government has been fast-tracking the implementation of infrastructure projects under the Build, Build, Build program to enhance trade facilitation and provide logistical support to manufacturers and exporters,” he added.